Opinion

in Re BP Products North America, Inc.

Court: Texas Court of Appeals, 1st District (Houston)
Filed: Aug 4, 2006
Status: Published
Cited by: 0 cases
Authority: More cited than 35.2%

The opinion

Opinion issued August 4, 2006

In The

Court of Appeals

For The

First District of Texas

NO. 01-06-00613-CV

IN RE BP PRODUCTS NORTH AMERICA INC. , Relator

Original Proceeding on Petition for Writ of Mandamus

MEMORANDUM OPINION

By petition for writ of mandamus, relator, BP Products North America Inc. ,

challenges the trial court’s June 21, 2006 order granting the motion of the Plaintiffs’

Steering Committee (“Plaintiffs”)

to strike BP’s “‘Objection’ to and/or Motion for

Protection Regarding the Deposition of John Manzoni,” Group Managing Director

and Chief Executive of Refining and Marketing of BP p.l.c.

In its sole issue, BP

contends that the trial court abused its discretion in striking the affidavit of Manzoni

as insufficient to invoke protection under the “apex doctrine” established in Crown

Central Petroleum Corp. v. Garcia , 904 S.W.2d 125 (Tex. 1995).

We conditionally grant the petition for writ of mandamus.

Background

On June 1, 2006, the Plaintiffs notified BP of their intent to depose Manzoni.

On June 6, BP moved for protection and moved to quash the notice on the grounds

that Manzoni, a resident of London, England, was not subject to deposition in Texas.

Footnoted in BP’s motion was an objection to Manzoni’s deposition on the grounds

that Manzoni, an “upper level corporate official,” was not subject to deposition under

the Crown Central guidelines. BP stated that it would later file a brief in support of

its objection. On June 14, the Plaintiffs moved to strike as legally insufficient BP’s

motion to quash and BP’s “‘Objection’ to the deposition of John Manzoni” because

BP had not filed the requisite affidavit by Manzoni.

On June 16, BP submitted its brief in support of its apex objection and

appended the affidavit of Manzoni, which stated as follows, in pertinent part:

3. I am Chief Executive of Refining and Marketing of BP p.l.c. and

have held this position since 2002. I am also a Group Managing

Director of BP p.l.c. and have held this position since 2003. In my

positions, I have global responsibility for refining and marketing and

ultimate responsibility for 17 refineries, a similar number of chemical

plants, 25,000 retail stations, pipelines and terminals. I report directly

to Lord Browne, who is Group Chief Executive of BP p.l.c. and the

highest official in BP p.l.c.

. . .

5. I am not a director, officer or employee of BP Products North

America Inc., an indirect wholly owned subsidiary corporation of BP

p.l.c. . . . BP Products North America Inc. owns and operates the Texas

City Refinery. I do not manage or authorize the day-to-day operations

of BP Products North America Inc. or of the Texas City Refinery.

6. I do not have unique or superior knowledge of information, much

less unique or superior personal knowledge, concerning the allegations

made in the lawsuits arising out of the March 23, 2005 accident at the

BP Products North America’s Texas City Refinery. Information

concerning the accident and the investigation of the accident was

provided to me from employees of both BP p.l.c. and BP Products North

America Inc. I did not participate in the investigation of the March 23,

2005 accident. I therefore have no personal knowledge of facts relevant

to the accident or the allegations made in the lawsuits filed against BP

Products North America Inc.

7. I have no unique personal knowledge of the Texas City facility or its

operations, including any safety issues or concerns. Information

concerning the Texas City facility or its operations, including any safety

issues or concerns was provided to me from employees of both BP p.l.c.

and BP Products North America Inc., including Michael Hoffman,

Group Vice President for Refining, who reports to me on these issues.

8. Thus, the only knowledge I have concerning the accident, the

investigation of the accident and the other allegations made against BP

Products North America Inc. is second hand. Certainly, I do not possess

relevant knowledge equal to or greater in quality or quantity than

executives and employees of BP Products North America Inc. or other

executives or employees of BP p.l.c.

9. After the March accident, BP Products North America Inc., in part

with the aid of loaned personnel from affiliated companies, immediately

began an investigation of the incident. That investigation was

performed by a group of highly qualified and knowledgeable

individuals, who were directed to use all resources to find the causes of

the accident and to report the causes to the public. All of these activities

were at the direction of and monitored by persons other than me,

although I have kept myself informed about the progress and results of

the investigation.

On June 19, BP filed a second motion for protection based on its objection and

filed a response to Plaintiffs’ motion to strike. On June 20, the Plaintiffs filed a brief

in support of their motion to strike, objecting to Manzoni’s affidavit on the grounds

that he admitted having knowledge concerning the accident and that he failed to state

that he has “‘no knowledge of any facts relevant’ to this lawsuit as Crown Central

and Alcatel require.” In addition, the Plaintiffs filed a supplemental motion to strike,

voicing the same contentions.

On June 21, after a hearing, the trial court granted the motion to strike, ordering

that

BP Products’ Motion for Protection for and/or objection to the

deposition of John Manzoni on alleged “apex” grounds is

stricken/denied/overruled because, in the exercise of the Court’s

discretion, it finds that BP has failed to invoke properly that doctrine by

failing to file an affidavit complying with Crown Central and Alcatel

and has not, therefore, presented an issue for this Court to decide. In

addition, this Court specifically finds that Mr. Manzoni has admitted

knowledge of relevant facts of the case precluding reliance on Apex .

It is from this order that BP seeks mandamus relief.

Standard of Review A party is entitled to mandamus relief if a trial court abuses its discretion or

violates a legal duty and the party has no adequate remedy by appeal. Walker v.

Packer , 827 S.W.2d 833 , 839–40 (Tex. 1992); In re Taylor , 113 S.W.3d 385, 389

(Tex. App.—Houston [1st Dist.] 2003, orig. proceeding). A trial court abuses its

discretion if “it reaches a decision so arbitrary and unreasonable as to amount to a

clear and prejudicial error of law.” Walker , 827 S.W.2d 839–40; see Taylor , 113

S.W.3d at 389 . With respect to factual issues, matters are committed to the trial

court’s discretion, and the reviewing court may not substitute its judgment for that of

the trial court. Walker , 827 S.W.2d at 839 ; Taylor , 113 S.W.3d at 389 . The relator

must establish that the trial court reasonably could have reached only one decision.

Walker , 827 S.W.2d at 840 . With respect to a trial court’s determination of legal

principles, however, review is less deferential. Id. ; Taylor , 113 S.W.3d at 389 . A trial

court has no discretion to incorrectly determine what the law is or to improperly apply

the law to the facts. Walker , 827 S.W.2d at 840 . A clear failure by the trial court to

analyze or apply the law correctly will constitute an abuse of discretion and may

result in an extraordinary writ. Id.

Generally, the scope of discovery is within the trial court’s discretion. In re

Colonial Pipeline Co. , 968 S.W.2d 938, 941 (Tex. 1998). However, the trial court

abuses its discretion if it issues a discovery order in an arbitrary or unreasonable

manner, or without reference to guiding rules and principles. See id. If there has

been a clear abuse of discretion and there is no adequate remedy by appeal,

mandamus will issue to correct the order. Id. Mandamus relief is appropriate if the

trial court erroneously permits the deposition of an apex official. In re Alcatel USA,

Inc. , 11 S.W.3d 173 , 175–76 (Tex. 2000).

Apex Deposition

In ordering or preventing an apex deposition, a trial court must apply the

guidelines set out in Crown Central Petroleum Corporation v. Garcia , 904 S.W.2d

125 (Tex. 1995). In re Daisy Mfg. Co. , 17 S.W.3d 654, 656 (Tex. 2000). Under

Crown Central , a corporation may shield a high-level corporate official from a

deposition by filing a motion for a protective order with an affidavit by the official

“denying any knowledge of relevant facts.” Crown Central , 904 S.W.2d at 128 .

The trial court determines the motion by first considering whether the proponent of

the deposition has “arguably shown that the official has any unique or superior

personal knowledge of discoverable information.” Id. If the proponent fails to make

such a showing, “the trial court should grant the motion for protective order and first

require the party seeking the deposition to attempt to obtain the discovery through

less intrusive methods.” Id. These methods could include taking the depositions of

lower-level employees or directing discovery requests to the corporation itself. Id.

If, after making a good faith effort to obtain the discovery through less intrusive

means, the proponent shows that (1) there is a reasonable indication that the official’s

deposition is calculated to lead to the discovery of admissible evidence and (2) that

less intrusive methods of discovery are insufficient, the trial court should modify or

vacate the protective order. Id.

Since Crown Central , the Texas Supreme Court has clarified that it is improper

to collapse the two discrete inquiries in Crown Central into a single test. Alcatel , 11

S.W.3d at 176 . For instance, the Crown Central guidelines should not be interpreted

to require a party seeking an apex deposition to show that the official to be deposed

has unique or personal knowledge that is unavailable through less intrusive means.

Id.

At issue in the instant case is whether Manzoni’s affidavit is sufficient to

invoke protection from deposition under Crown Central. Pursuant to Crown Central ,

the apex deposition guidelines are invoked by including with a motion for a

protective order, an affidavit by the official “denying any knowledge of relevant

facts.” Crown Central , 904 S.W.2d at 128 . Here, the trial court found that BP failed

to properly invoke the Crown Central doctrine because it failed “to file an affidavit

complying with Crown Central and Alcatel .” In addition, the trial court found that

Manzoni had admitted knowledge of relevant facts of the case, which precluded

reliance on the apex doctrine.

The Plaintiffs contend that, because Manzoni’s affidavit failed to specifically

deny “any knowledge of relevant facts,” it was properly found to be insufficient to

invoke the apex doctrine. Specifically, the Plaintiffs contend that Manzoni’s affidavit

as insufficient because it uses the following qualifying language:

6. I do not have unique or superior knowledge of information, much

less unique or superior personal knowledge concerning the allegations

made in the lawsuits arising out of the March 23, 2005 accident at the

BP Products North America’s Texas City Refinery. Information

concerning the accident and the investigation of the accident was

provided to me from employees of both BP p.l.c. and BP Products North

America Inc. I did not participate in the investigation of the March 23,

2005 accident. I therefore have no personal knowledge of facts relevant

to the accident or the allegations made in the lawsuits filed against BP

Products North America Inc. (Emphasis added).

7. I have no unique personal knowledge of the Texas City facility or its

operations, including any safety issues or concerns. . . . (Emphasis

added).In addition, the Plaintiffs contend that Manzoni admits that he has knowledge

regarding the matters at issue, as follows:

6. . . . Information concerning the accident and the investigation of the

accident was provided to me from employees of both BP p.l.c. and BP

Products North America Inc. . . .

8. Thus, the only knowledge I have concerning the accident, the

investigation of the accident and the other allegations made against BP

Products North America Inc. is second hand. . . . (Emphasis added).

During the hearing on the motion to strike, the Plaintiffs raised the following

as evidence that Manzoni has knowledge of relevant facts: (1) testimony that the

Chemical Safety Board reported that one of the causes of the explosion was a lack of

corporate oversight and that Manzoni is “the guy in charge of corporate oversight”

and (2) testimony that, the day after the explosion, Manzoni flew in from Great

Britain and gave a press conference in Texas City, during which he stated that “on

behalf of the corporate parent we take responsibility for this, we’ll get to the bottom

of it and we’ll fix it.”

In addition, the Plaintiffs presented to the trial court for in camera inspection

a letter from BP’s CEO, Lord John Browne, to BP staff regarding the interim

conclusions and recommendations prepared by the team of personnel investigating

the explosion (“Fatal Accident Report”) stating that “I have asked John Manzoni to

lead the next stage of implementation within the Refining and Marketing segment.

He will insure that all the changes necessary are made.” Further, Plaintiffs contend

that BP’s website states that “When an explosion at the Texas City Refinery in the

U.S. killed 15 people and injured 170 last March, Manzoni handled the situation with

care and sensitivity.”The Plaintiffs rely on In re Columbia Rio Grande Healthcare , 977 S.W.2d 433,

434 (Tex. App.—Corpus Christi 1998, orig proceeding), as “the only reported case

involving a potential deponent who, like Mr. Manzoni here, admits knowledge about

the case in question.” In Columbia , an official’s affidavit “did not contain a broad

denial of ‘any knowledge of relevant facts” and denied only that he had “personal

knowledge of many aspects of the lawsuit.” Id . The court held that the official’s

affidavit “failed to satisfy the threshold requirement of Crown Central , to ‘deny any

knowledge of relevant facts.’” Id. However, Columbia has been cited solely in

apparent disagreement.

BP contends that the affidavit is sufficient to invoke Crown Central because

it properly denies knowledge of relevant facts. Specifically, BP contends that, while

Manzoni’s affidavit does not specifically deny “any knowledge of relevant facts,” the

language in the affidavit has been interpreted to satisfy Crown Central . BP contends

that Crown Central does not require the use of any “magic words.” In addition, BP

contends that the Plaintiffs failed in their burden to demonstrate, as required under

Crown Central , that Manzoni has “unique or superior personal knowledge.” Plaintiffs

respond that, because the doctrine was not invoked, the burden never shifted to the

Plaintiffs to show “unique or superior personal knowledge.”

BP argues that, since Crown Central , there are only a few cases in which

appellate courts have affirmed refusals to quash apex depositions, citing JHC

Ventures L.P. v. Fast Trucking, Inc. , 94 S.W.3d 762 , 777–78 (Tex. App.—San

Antonio 2002, no pet.) and In re Columbia Rio Grande Healthcare , 977 S.W.2d 433,

434 (Tex. App.—Corpus Christi 1998, orig proceeding).

In JHC , the appellate court upheld the trial court’s refusal to quash a deposition

of an apex affidavit official because the trial court was within its discretion to find

that the company was “wrongfully resisting discovery” of the official. JHC , 94

S.W.3d at 777–78. Importantly, in JHC , the party wishing to depose the apex official

presented deposition testimony by a witness who said that the apex official was the

“only person” with knowledge of relevant facts. Id. The court’s decision, therefore,

was not premised on the adequacy of the apex official’s affidavit, but rather on the

evidence introduced that rebutted the contents of the affidavit. Id. at 778. JHC ,

therefore, is distinguishable from the situation before us. As discussed above,

Columbia has been exclusively met with disagreement.

We think that the better rule is that a mechanical application of Crown Central

in determining the sufficiency of an affidavit to invoke the apex doctrine is to be

rejected. See In re Texas Genco , 169 S.W.3d 764, 768 (Tex. App.—Waco 2005, orig.

proceeding) (concluding that affidavit in which official attested that he had “no

involvement in the operation or management of the [plant]” and had “no specialized

or unique knowledge of the operations” and “no personal knowledge . . . other than

what has been reported to me” was sufficient to invoke protection under Crown

Central doctrine); In re Burlington N. and Santa Fe Ry. Co. , 99 S.W.3d 323 , 326 n.3

(Tex. App.—Fort Worth 2003, orig. proceeding) (concluding that affidavit in which

official attested that he had “no specific or superior knowledge with regard to the

. . . issue in the suit or with regard to any other aspect of the case” was sufficient to

invoke protection under Crown Central doctrine and explaining that there is no

requirement that a party must specifically recite language of Crown Central in an

affidavit to show that affiant has no knowledge of relevant facts); In re El Paso

Healthcare Sys. , 969 S.W.2d 68, 73 (Tex. App.—El Paso 1998, orig. proceeding)

(concluding that affidavit in which official attested that he had no personal

knowledge of the employees’ jobs or of the day-to-day administration was sufficient

to invoke protection under Crown Central doctrine); AMR Corp. v. Enlow , 926

S.W.2d 640 , 643–44 (Tex. App.—Fort Worth 1996, no pet.) (concluding that

affidavit in which official attested that he had no “personal knowledge of the conduct,

actions, or events at issue,” or “the training” employees received, or “the decisions

related to or procedures for changing” policies was sufficient to invoke protection

under Crown Central doctrine).

Based upon an analysis of these cases, the following specific statements in

Manzoni’s affidavit constitute a sufficient denial of relevant facts to invoke

protection under Crown Central :5. . . . I do not manage or authorize the day-to-day operations of BP

Products North America Inc. or of the Texas City Refinery. (Emphasis

added).

See Texas Genco , 169 S.W.3d 766 ; El Paso Healthcare Sys. , 969 S.W.2d at 73 .