Rule 30(b)(6) of the Federal Rules of Civil Procedure (FRCP) allows a party to direct a discovery subpoena to an entity rather than to a named individual. When a party seeking to depose a corporation or other organization announces the subject matter of the proposed deposition, the subpoenaed organization must produce someone familiar with that subject, who is able "to give complete, knowledgeable and binding answers" on its behalf (see Reilly v. Natwest Mkts. Grp. Inc., 181 F.3d 253, 268 (2d Cir. 1999)). When the organization fails to comply with Rule 30(b)(6), FRCP 37 allows the court to impose sanctions. As the Eleventh Circuit recently held, those sanctions can be substantial.

In Sciarretta v. Lincoln National Life Insurance Co., the appeals court affirmed a sanction of $850,000 against a nonparty for failing to produce a witness with knowledge in response to a 30(b)(6) subpoena (778 F.3d 1205 (11th Cir. 2015)). Notably, the court held:

Sciarretta, as trustee, sued Lincoln National Life Insurance Co. over a $5 million life insurance policy owned by the trust. Lincoln subpoenaed Imperial Premium Finance LLC, which lent money to the trust for premiums and for the trust's litigation expenses. Lincoln claimed that Imperial had financed the purchase of the policy to market it to speculators under a Stranger-Originated Life Insurance (STOLI) scheme and refused to pay the death benefit on that basis. Lincoln subpoenaed Imperial under Rule 30(b)(6). During the deposition, the witness was often unable to answer questions because Imperial had not briefed him on the answers. After the witness testified at trial, the district court characterized the witness as having been "blatant in his failure to follow the rules" for a designated witness. Imperial, it said, "hid behind" the witness, meaning that it hid facts harmful to it by not briefing him on them. The court scheduled a hearing on the issue of sanctions.

After the hearing, the court concluded that Imperial was the driving force behind the litigation and its selective preparation of its 30(b)(6) witness constituted bad faith. The judge imposed a sanction of $850,000, which was the stipulated amount of attorney's fees Lincoln was obligated under the judgment to pay the trust for fees the trust incurred in prevailing against Lincoln in the underlying action on the policy. The $850,000 sanction inverted the award of fees under Florida Statute § 627.428, in order to "prevent [ ] Imperial from obtaining attorney's fees and costs from the party harmed by its inequitable conduct."

On appeal, Imperial argued:

The Eleventh Circuit rejected these arguments, noting that:

To avoid the risk of severe sanctions, attorneys should prepare clients to be knowledgeable on all the issues specified in the subpoena or notice. The witness should be prepared on not only helpful facts but harmful ones as well. For more information on identifying and preparing Rule 30(b)(6) deposition witnesses, see Practice Note, How to Prepare for and Successfully Defend a Rule 30(b)(6) Deposition and Standard Document, Notice of Deposition (Fed. R. Civ. P. 30(b)(6)).