Does a nonresident officer’s prior service to a Delaware corporation allow the Delaware courts to compel her to appear to testify at trial as a third-party witness? What if that officer’s testimony—and credibility—was critical to the case? These are the questions that the stockholder plaintiffs put to Vice Chancellor J. Travis Laster in In re PLX Technology Stockholders Litigation, C.A. No. 9880-VCL (Del. Ch.). The vice chancellor refused to compel such an appearance—even where issues of credibility are paramount. Thus, practitioners in Delaware preparing cases for trial must recognize that the deposition of a nonresident, former corporate officer may well be the only chance an opposing advocate has to elicit and present testimony for use at trial, even from witness that all parties concede is critical to the case.
The PLX plaintiffs sued Potomac Capital Partners L.P. for aiding and abetting the PLX board’s alleged breach of fiduciary duty in approving the all-cash acquisition of PLX by Avago Wireless. In discovery, plaintiffs deposed Arthur Whipple, who had been PLX’s CFO when the merger was approved but had left the company shortly afterward. The plaintiffs did not allege that Whipple had breached any duty or engaged in misconduct, but his account of events—and his credibility in testifying to that account—were “core to a lot of the case.” H’rg. Tr. (Mar. 16, 2018) (“Tr.”) at 3:22-23. The plaintiffs, therefore, were not content to simply play video of Whipple’s testimony at trial. Rather, they issued a subpoena, served on PLX’s registered agent, to compel Whipple to travel from California to Delaware to testify as a live witness. Whipple retained his own counsel and resisted the subpoena, preferring to stay out of the fray and simply go about his West Coast life. The plaintiffs moved to enforce.
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