Avoiding the Deposition Debacle: Tips for Successfully Taking and Defending the Insurer s Corporate Deposition

Transcription

1 Avoiding the Deposition Debacle: Tips for Successfully Taking and Defending the Insurer s Corporate Deposition Joan M. Cotkin Nossman LLP Christopher C. Frost Maynard Cooper & Gale, P.C. Darren Teshima Orrick, Herrington & Sutcliffe LLP

2 Pitfalls or Preparation? Topic Selection/Objection Witness Selection Witness Preparation Objections/Preservation for later use

3 Deposition Topics Building Blocks Defines Parameters Basis (Rule 26 or State Equivalent) Claims & Defenses ( Proportionality ) Objections (When and How)

4 Topic Objections Discovery / Scheduling Order Letter Rule 37 Protection

5 Letter? The proper operation of the rule does not require a process of objection and Court intervention prior to the deposition regarding disputed topic designations Defendants in this case simply should have proceeded with the deposition and then after the deposition if there were disputes regarding any privilege objections raised during the deposition or objections regarding the scope, the Court could then have addressed the issues either through a motion to compel or through a motion for protective order with the benefit of the transcript containing questions and answers (or objections of privilege based upon specific questions). F.D.I.C. v. Brudnicki, 2013 WL (N.D. Fla. Oct. 29, 2013)

6 But Wait Rule 37 Protection The proper procedure to object to a Rule 30(b)(6) deposition notice is not to serve objections on the opposing party, but to move for a protective order If the corporation makes no such showing, the corporation must produce a witness prepared to testify to the subject matter described in the notice. Id. The corporation cannot make its objections and then provide a witness that will testify only within the scope of its objections. Id. Beach Mart, Inc. v. L&L Wings, Inc., 302 F.R.D. 396 (E.D.N.C. 2014)

7 State Law Example California Appellant did not serve objections to his second deposition notice and he did not move for a protective order from the court. (Code Civ. Proc., , subds. (a) [any error in deposition notice is waived unless objections are served three calendar days prior to the deposition], (c) [party may also seek order staying taking of deposition].) Kwong Hiu Yung v. Yodle, Inc., 2013 WL (Cal. 6th Dist. July 12, 2013)

8 Central Casting Witness Selection

9 Witness Selection

10 Central Casting Experience vs. Familiarity Temperament & Presentation Inside vs. Outside

11 Witness Selection Central Casting Selection Standard

12 Selection Standard Federal Rule 30 PMQ

13 Selection Standard FRCP 30(b)(6): Information Known or Reasonably Available to the Insurance Company

14 Selection Standard California CCP 2025 PMQ : Most Qualified To Testify On Information Known or Reasonably Available to the Deponent

15 Witness Selection Central Casting Selection Standard Split Personalities?

16 Split Personalities Strategic Considerations Multiple Witnesses = Multiple Time Limits

17 Witness Preparation

18 Witness Preparation FRCP 30(b)(6) vs. PMQ Time/Mock Exercises Ultimate Issues / Ultimate Facts Town Crier or Mum s the Word?

19 FRCP 30(b)(6): Witness Preparation The corporation or entity receiving a 30(b)(6) notice must make a good-faith effort to designate people with knowledge of the matter sought by the opposing party and to adequately prepare its representatives so that they may give complete, knowledgeable, and nonevasive answers.... Spicer v. Universal Forest Prod., E. Div., Inc., No. 7:07CV462, 2008 WL , at *3 (W.D. Va. Oct. 1, 2008)

20 FRCP 30(b)(6): Witness Preparation The mere fact that an organization no longer employs a person with knowledge on the specified topics does not relieve the organization of the duty to prepare and produce an appropriate designee. Faced with such a scenario, a corporation with no current knowledgeable employees must prepare its designees by having them review available materials, such as fact witness deposition testimony, exhibits to depositions, documents produced in discovery, materials in former employees' files and, if necessary, interviews of former employees or others with knowledge. QBE Ins. Corp. v. Jorda Enterprises, Inc., 277 F.R.D. 676, 689 (S.D. Fla. 2012)

21 Witness Preparation California CCP 2025 PMQ : The code applies by its language only to current officers, directors, managing agents, or employees. Corporation is not required to produce any of its former officers, directors, managing agents of employees, even if they far more knowledgable about the litigation than anyone currently employed by the company. Maldonado v. Superior Court, 94 Cal. App. 4th 1390, 1398 (2002)

22 Witness Preparation California CCP 2025 PMQ : Certainly, no single person is expected to be familiar with the total contents of a corporation's files. When a request for documents is made, however, the witness or someone in authority is expected to make an inquiry of everyone who might be holding responsive documents or everyone who knows where such documents might be held. Maldonado v. Superior Court, 94 Cal. App. 4th 1390, 1396, (2002)

23 Expose Unpreparedness

24 Prove Preparedness

25 Case Studies

26 Deadline Depositions Wausau Underwriters Ins. Co. v. Danfoss, LLC 310 F.R.D. 683 (S.D. Fl. 2015) Background: Insurer brought suit against insured for breach of contract alleging insured failed to pay increased premiums for workers compensation/employer liability policy. Insurer s corp. rep. deposed one day before the discovery deadline. Court found that corp. rep. was inadequately prepared because: No first-hand knowledge of insured s account or claims handling with respect to the insured s policy. Failed to investigate by asking co-workers who were involved in these aspects of the claim; Unfamiliar with internal auditing procedures and guidelines; Could not answer whether insurer departed from standard operating procedures in handling insured s claim Remedy Because the discovery deadline had passed, Court held Insurer precluded from offering any testimony or taking any positions at trial inconsistent with corp. rep. s deposition testimony on the designated topics. This includes I don t know answers.

27 Cannot De-designate Slot Speaker Technologies v. Apple, Inc WL (N.D. Ca. 2017) Background: Patent holder brought suit against Apple for alleged patent infringement. Patent holder s corp. rep. unable to provide testimony on numerous topics noticed in 30(b)(6) deposition notice. Following deposition, patent holder s counsel notified Apple s counsel that it could pursue the topics at issue with another employee, and that other employee s testimony on those topics would constitute the testimony of the company. Apple objected. Court found corp. rep. was not prepared as required by Rule 37, which amounted to failure to appear. Rejected patent holder s argument that 70 hours of deposition prep with counsel over the course of 9 meetings rendered sanctions unjust. Remedy The fact that the prejudice to Apple was mitigated, in part, by a substitute 30(b)(6) deponent does not erase the reality that Apple had to depose two witnesses for information it should have been able to obtain from just one. Also, Patent holder cannot unbind itself from the corp. rep. s testimony by offering a new corp. rep to testify as to the topics at issue.

28 Relevancy is No Excuse Seek a Background: Asbestos litigation. Protective Order! Storer v. Crown Cork & Seal Co WL (W.D. La. 2017) For over 9 months, Defendant deferred its corporate deposition on basis that specific employee, who was unavailable, is the representative to best address the designated issues. Once deposed, Defendant s corp. rep. did not know the answers to 75 questions and answered I don t know or I don t recall 20 times. Court found it glaringly apparent deponent was not prepared., which amounted to failure to appear. Rejected Defendant s argument that the topics noticed were overbroad and irrelevant: Failure to appear at a deposition is not excused on the basis that the discovery sought was objectionable unless the party failing to appear had a pending motion for protective order under Rule 26(c). Remedy Defendant ordered to produce one or more additional representatives fully prepared to address all matters noticed by Plaintiffs. Defendant also ordered to reimburse Plaintiffs for cost of court reporter and attorneys fees in connection with first deposition.

29 Matters of Examination The Document Dump Scott Hutchinson Enterprises, Inc. v. Cranberry Pipeline Corp WL (S.D.W.V. 2016) Background: Plaintiff issued interrogatories requesting identity of all documents supporting Defendants position that they had permission to place pipeline across real property at issue. Defendants interrogatory responses directed Plaintiff to over 4,000 files in the pipeline file. 30(b)(6) deposition notice sought testimony from Defendants regarding the relevancy of the pipeline file documents and the role those documents play in supporting Defendants claims and defenses. Defendants failed to object to this topic. Defendants corp. rep., while knowledgeable of the pipeline operations, had no knowledge of the claims and counterclaims in the action. It is axiomatic that an individual who has no knowledge of the claims and defenses will be hard-pressed to provide accurate testimony connecting the documents at issue to those claims and defenses. Court found Defendants engaged in document dump in violation of Rule 26(g)(3). Had Defendants properly responded to Interrogatories, Plaintiff would not have required a 30(b)(6) deposition to explain the relevance of those documents. Defendants failed to satisfy their obligation to prepare corp. rep. to provide complete, knowledgeable, and nonevasive answers on behalf of Defendants regarding each of the documents contained in the pipeline file. Even if some of the documents in the pipeline

30 Objection Perfection

31 Objection Perfection Federal vs. State Topic Scope & Harassment (FRCP) Evidentiary Considerations

32 Objection Perfection FRCP 30: Objections must be 1. Noted on the record 2. Concise 3. Non-argumentative 4. Non-suggestive

33 Objection Perfection CA CCP : Errors and irregularities of any kind occurring at the oral examination that might be cured if promptly presented are waived unless a specific objection to them is timely made during the deposition. These errors and irregularities include, but are not limited to, those relating to the manner of taking the deposition, to the oath or affirmation administered, to the conduct of a party, attorney, deponent, or deposition officer, or to the form of any question or answer. Unless the objecting party demands that the taking of the deposition be suspended to permit a motion for a protective order under Sections and , the deposition shall proceed subject to the objection.

34 Objection Perfection Instructions not to answer ONLY when necessary to 1. Preserve a Privilege 2. Enforce a Court-Ordered Limitation 3. Present a Motion Under FRCP 30(d)(3)

35 Nuclear Option Handle with Care FRCP 30(d)(3): Allows a party to suspend the deposition to allow time to seek its termination or limitation "on the ground that it is being conducted in bad faith or in a manner that unreasonably annoys, embarrasses, or oppresses the deponent or party." (See also CA CCP )

36 Topic Scope Objection Courts in the Second Circuit, and others, have recognized a party's right to object during a 30(b)(6) deposition where matters fall outside the scope of the 30(b)(6) notice. See, e.g., Meyer Corp. U.S. v. Alfay Designs, Inc., No. CV (CBA)(MDG), 2012 WL , at *5 (noting that a party is permitted to object to a question as beyond the scope of the [30(b)(6) ] notice in order to preserve for the record that the deponent is answering such a question in an individual, not corporate capacity [... ]. ). Falchenberg v. New York State Dep't of Ed., 642 F.Supp.2d 156, 165 (S.D.N.Y.2008) (citing cases) ( Questions and answers exceeding the scope of the 30(b)(6) notice will not bind the corporation, but are merely treated as the answers of the individual deponent. ) A&R Body Specialty and Collision Works, Inc. v. Progressive Cas. Ins. Co., 2013 WL (D. Conn. Nov. 26, 2013)

37 Topic Scope Objection (But Wait.) As an initial matter the rule does not limit what can be asked of a designated witness at a deposition. King v. Pratt & Whitney, 161 F.R.D. 475, 476 (S.D. Fla. 1995). The reason for adopting Rule 30(b)(6) was not to provide greater notice or protections to corporate deponents, but rather to have the right person present at the deposition. Id. F.D.I.C. v. Brudnicki, 2013 WL (N.D. Fla. Oct. 29, 2013)

38 Topic Scope Objection Courts are divided on the issue of whether a Rule 30(b)(6) deponent must answer all relevant questions regardless of whether those questions or topics were noticed in the deposition. Some courts have favored a rule that, regardless of the information contemplated in the notice of deposition, the deponent must answer all relevant questions. See King v. Pratt & Whitney, 161 F.R.D. 475 (S.D. Fla. 1995) (holding that, if an examining party's questions exceed the scope of the notice, the general deposition rules govern and no special protection is conferred to the deponent, but if the deponent does not know the answer to questions outside the scope of matters described in the notice, the examining party must deal with the issue) Rule 30(b)(6) deponent must answer all inquiries that meet the requirements of Rule 26. Crawford v. George & Lynch, Inc., 19 F. Supp. 3d 546 (D. Del. 2013)

39 Topic Scope Objection [I]f a Rule 30(b)(6) witness is asked a question concerning a subject that was not noticed for deposition or that seeks information not reasonably available to the corporation, the witness need not answer the question. State Farm Mut. Auto. Ins. Co. v. New Horizont, Inc., 250 F.R.D. 203 (E.D. Pa. 2008)

40 Evidentiary Considerations Correcting Objections Hearsay / Business Records Scope Present Recollection Refreshed Past Recollection Recorded Deposition use at Trial

41 Present Recollection Refreshed

42 Present Recollection Refreshed If a witness forgets something he at one time knew and had personal knowledge of, he may be shown a writing to refresh his memory. The writing or document used by the witness to refresh his memory cannot be admitted as evidence or read to the jury, it can only be used to refresh the witness's memory of something he once knew.

43 Past Recollection Recorded Allows a witness to read a writing to the jury if: (1) the witness once had personal knowledge of the writing; (2) if the witness now forgets the writing and showing the writing to the witness does not jog his or her memory; (3) the writing was either made by the witness or adopted by the witness; (4) the writing was made when the event was fresh in the witness s memory; and (5) the witness can attest that, when made, the writing was accurate.

44 Deposition Use at Trial Objections Matter

45 Deposition Use at Trial Despite Plaintiff's counsel's assertion that an objection was lodged to this testimony, no such objection appears on the record. [A]n objection at the time of the examination whether to evidence, to a party's conduct, to the officer's qualifications, to the manner of taking the deposition, or to any other aspect of the deposition must be noted on the record. FED. R. CIV. P. 30(c)(2). Therefore, Plaintiff's basis for his objection now is improper. A&R Body Specialty and Collision Works, Inc. v. Progressive Cas. Ins. Co., 2013 WL (D. Conn. Nov. 26, 2013) Indeed, a party who has not objected to a leading question at the taking of a deposition may not subsequently object to it when the deposition is introduced at the trial. Elyria Lorain Broadcasting Co. v. Lorain Journal Co., 298 F.2d 356, 360 (6th Cir. 1961). Whitehurst v. U.S., 231 F.R.D. 500 (S.D. Tex. 2005)

46 Deposition Use at Trial Objections Matter Availability / Subpoena Power Authentication of Exhibits?

47 Practice Tips

48 END GOAL

49 Comments/Questions??