Black-Owned Equity Firm Wants to Depose ex-AT&T CEO on Civil Rights Act Allegations

The parties in the case in which Legacy Equity Advisors accuses AT&T of violating Section 1981 of the Civil Rights Act for blocking the private equity firm from bidding on DirecTV and other divested AT&T assets due to its African American ownership want the U.S. District Court for Northern Texas in Dallas to place the case on a trial docket for mid-February 2025, said their joint status report and scheduling proposal Tuesday (docket 3:23-cv-00979). AT&T’s July 17 motion to dismiss called Legacy’s allegations as “offensive” as they are “baseless” (see 2307180002).

Based on the “intended breadth” of discovery that Legacy indicated it will serve, “AT&T believes it will file a motion to stay discovery,” pending resolution of its motion to dismiss, said the report. AT&T would move to stay discovery only after Legacy serves its discovery requests and once it has “an opportunity to assess the burdens of responding” to those requests, it said. The parties estimate a jury or non-jury trial would last seven to 10 days, and they won’t consent to referring the case to a magistrate judge, it said.

The parties propose a Sept. 29 deadline to file a motion for leave to join other parties, and suggest fact discovery be completed by May 17 and that expert discovery be done by Aug. 1, said the report. Legacy intends to do discovery on at least 14 “subject matters,” including Legacy’s submission of bids for AT&T’s divested assets, plus the reasons why AT&T didn’t allow Legacy to bid on DirecTV, it said.

In seeking such discovery, Legacy plans to depose former AT&T Chairman-CEO Randall Stephenson and former Chief Financial Officer John Stephens, plus all other AT&T executives named in its complaint for statements they made that gave rise to Legacy’s Section 1981 allegations, said the report. They include former Senior Vice President Steve McGaw and Managing Director Chris Cass, it said. AT&T will oppose Legacy's efforts to depose Stephenson, it said, saying deposing its former CEO "would be unduly burdensome and harassing, and that less intrusive means should be used to obtain any relevant evidence."

AT&T intends to move to stay discovery pending the court's ruling on the motion to dismiss, said the report. The decision on the motion “may obviate the need for any discovery or, at a minimum, reduce the topics, assets, and transactions that otherwise would be the subject of discovery,” it said. AT&T thinks Legacy's allegations “are so broad,” and the corresponding factual “underpinnings” are so “thread-bare,” that judicial economy dictates the parties should await the court's guidance “before embarking on the extensive discovery suggested by Legacy that likely will be rendered moot,” it said.

AT&T thinks Legacy’s proposed discovery would be “unduly burdensome,” said the report. It worries Legacy’s discovery requests would require AT&T “to identify, process and produce data and documents that would be cost-prohibitive,” and those costs “would far outweigh any likely probative value of any information produced,” it said.

AT&T also thinks any of the requested depositions “would necessarily require counsel to review voluminous documents in preparation for such depositions, and expend substantial resources preparing such individuals for testimony," said the report. That all would be for naught, “when all or a large portion of the claims made by Legacy should be dismissed before any such depositions occur,” it said.