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D''Agostino v. Johnson & Johnson

Decided: May 23, 1990.


On appeal from the Superior Court of New Jersey, Law Division, Essex County.

King and Shebell. The opinion of the court was delivered by Shebell, J.A.D.


At issue in this interlocutory appeal is the propriety of a Law Division order requiring defendant corporation to produce certain officers and employees of its wholly-owned foreign subsidiaries for depositions in New Jersey. Plaintiff Richard J. D'Agostino's complaint against defendants Johnson & Johnson, a New Jersey corporation, Robert N. Wilson and Ronald F. Gelbman filed on December 4, 1986, in the Law Division claims that Johnson & Johnson (J & J) had caused its wholly-owned Swiss subsidiary, Cilag A.G., to wrongfully terminate his employment. It also alleges intentional injury to another, conspiracy, libel and slander.

The Law Division's grant of defendants' motion to dismiss the complaint on the basis of the doctrine of forum non conveniens was reversed in an earlier appeal. See D'Agostino

v. Johnson & Johnson, Inc., 225 N.J. Super. 250, 257, 542 A.2d 44 (App.Div.1988), aff'd, 115 N.J. 491, 559 A.2d 420 (1989). After examining the relevant factors, we concluded that while Switzerland provided an adequate forum, because plaintiff asserted that many occurrences pertinent to the law suit happened here, New Jersey was an equally appropriate forum. Id. at 262-67, 542 A.2d 44. Our Supreme Court affirmed this court's decision, and the matter was remanded to the Law Division. 115 N.J. 491, 559 A.2d 420.

In November 1989, plaintiff gave notice to take oral depositions of 16 individuals, including officers of J & J's foreign subsidiaries, but did not subpoena the proposed witnesses. J & J refused to present several of the proposed witnesses for depositions, including officers of its wholly-owned foreign subsidiaries. J & J asserted that plaintiff did not have the right to require the presence at depositions of individuals who were officers of foreign subsidiaries because these subsidiaries were separate legal entities, the individuals were unrelated to the case, beyond the subpoena power of New Jersey courts and were prohibited from participating in depositions under Swiss law.

Due in part to defendants' failure to produce the requested witnesses for depositions on December 1, 1989, plaintiff moved to compel discovery and requested the imposition of sanctions. Argument was heard on January 5, 1990, after which the judge delivered a decision in favor of plaintiff from the bench. On January 31, 1990, a discovery order was entered and a letter opinion issued providing in pertinent part: "Defendants shall produce those corporate witnesses to testify in accord with the Notice of Deposition of November 13, 1989, provided they are officers, directors, or managing agents of defendant corporation or its subsidiaries." We granted leave to appeal from portions of the January 31, 1990, order which required officers of J & J's subsidiaries to attend depositions in New Jersey.

The underlying facts of this case were detailed in our earlier opinion regarding defendants' motion to dismiss on the basis of forum non conveniens. See 225 N.J. Super. at 253-57, 542 A.2d 44. Therefore, we only briefly recount the facts. As we noted at the time of our earlier opinion, "[t]he factual background of this litigation is hotly contested." Id. at 253, 542 A.2d 44.

On December 21, 1984, plaintiff entered into an employment contract with J & J's wholly-owned subsidiary, Cilag A.G. (Cilag). Cilag manufactures and markets pharmaceuticals in Switzerland. Through its affiliates, Cilag International and Cilag Products, it also markets products in other countries in Europe. Plaintiff was hired as General Manager of Cilag's home market division. Among other duties, plaintiff was responsible for registration and approval of new pharmaceutical products. Plaintiff allegedly reported to "Paul Reinstadtler, the managing director of Cilag Gmbh, a German subsidiary of Johnson & Johnson, and Hans S. Schmid, Vice President of J & J International as well as President and Chairman of the Board of Cilag, A.G. and Vice President of Cilag International A.G."

Shortly after being hired by Cilag, plaintiff became aware of J & J's strong desire to gain Swiss approval of Imunox, a synthetic hormone marketed elsewhere in Europe by J & J. In his complaint, plaintiff recounted a meeting that took place on June 8, 1985, at J & J headquarters in New Brunswick, New Jersey, between himself and several officials of J & J and its subsidiaries. These officials included defendant Robert N. Wilson. Plaintiff alleged that Wilson was "Vice Chairman of the J & J Executive Committee and Chairman of the Pharmaceutical Sector and [was] Executive Vice President of Johnson & Johnson International." Plaintiff further claimed that Mr. Wilson was responsible for pharmaceutical registration and marketing policies for "J & J International's overseas subsidiaries . . . ." Defendants denied this allegation and maintained that Mr. Wilson was only Chairman of J & J's Pharmaceutical Diagnostics Section. According to plaintiff's complaint, the coordinator

of J & J's European effort to obtain approval of Imunox reported directly to Mr. Wilson at J & J headquarters in New Jersey.

Plaintiff was fired on July 24, 1985. He alleges his dismissal was related to his refusal to approve certain consulting fees which he deemed suspect, and which he inferred might be related to improperly expediting approval of Imunox. Defendants assert that plaintiff's dismissal was caused by a variety of problems, including "a certain lack of cooperation, an inattention to company objectives . . . and a basic failure to perform the sales and managerial responsibilities which we had expected of him."

After being advised of plaintiff's intention to sue for wrongful termination based on his refusal to authorize the payments, Cilag commenced legal actions against plaintiff in a Swiss court. Cilag sought "a declaratory judgment that plaintiff had no claims against Cilag arising from his employment or its termination, and an injunction prohibiting plaintiff from disclosing confidential Cilag documents to third parties." We were advised at oral argument on this appeal that the Swiss court dismissed the action on its own motion for failure to raise a justiciable issue.

Defendants argue that paragraph one of the Law Division's discovery order requiring defendants to produce for depositions corporate witnesses that are "officers, directors, or managing agents of defendant corporation or its subsidiaries[ ]" is improper as "[t]here is no legal basis for compelling deposition discovery from non-party subsidiaries of Johnson & Johnson as if they were parties." In addition, defendants maintain that the court's reliance on cases pertaining to discovery of documents from a parent company's subsidiary pursuant to R. 4:18-1 is inappropriate because the discovery ...

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