[author: James A. Lowery]*
The most famous quote attributed to arguably the greatest military leader of all time, Napoleon Buonaparte, was “(N)ever interrupt your enemy when he is making a mistake.” Napoleon had many faults, but his ability to see the entire battlefield and to take the plans and tactics of his enemies and use those against them was unmatched in human history.
Everyone expert in the space knows that asbestos litigation is nothing short of total warfare. Dozens of companies have gone bankrupt since the early 1980’s. Billions spent in judgments, settlements and defense costs. Courts clogged for decades by the “elephantine mass” of hundreds of thousands of claims.
It’s not an overstatement to say that the lynchpin of the defense in asbestos litigation is the preparation and presentation of the corporate representative witness. Corporations cannot take the witness stand. Thus, the corporate witness, or Person Most Knowledgeable (PMK), not only speaks for the corporation and binds the corporation by his or her answers, the PMK is the corporation in the eyes of the jury. Properly preparing and presenting the PMK is critical, but too often defense counsel miss opportunities to use their PMK to tell their client’s story, to establish key facts and to put a human face on their corporate client. This article seeks to present a game plan for working with PMKs in order to achieve these goals.
What is Required of a Corporate Witness
Federal Rule of Civil Procedure §30(b)(6), followed by most jurisdictions, requires the organization to designate witnesses who will testify not only to the information known to the organization, but also information that is reasonably available to the organization. The organization also has an obligation to conduct a thorough investigation for information relevant to the subject matters denoted in the deposition notice. Further, the organization has an obligation to work with the 30(b)(6) witness to educate that witness to competently respond to questions posed by the party noticing the deposition.
Yet, these requirements have limits and counsel must work to limit the scope of PMK depositions. That begins the moment the areas of inquiry are identified, continuing when the deposition notice is received and through the preparation and conduct of the deposition.
The 30(b)(6) Deposition Notice
Discussions to limit the scope of the PMK deposition should begin before the plaintiffs serve the deposition notice. Defense counsel should confer with plaintiffs on this issue as soon as the request for a PMK deposition is raised and plaintiffs identify the proposed areas of inquiry. These discussions should include offers to use prior PMK transcripts if that testimony reasonably addresses the topics at issue and counsel feels the prior testimony does not harm the defense of the case.
Once defense counsel receives the PMK deposition notice, they must carefully review the notice and prepare objections, both to the scope and specific topics listed in the notice. This should also include a meet and confer session with plaintiff’s counsel to see if agreement can be reached to limit the deposition. Absent any agreement, a motion for protective order should be filed in order to make every effort to reign in plaintiff’s counsel and protect the corporate witness and defendant.
Identifying the Right PMK
Perhaps the most important decision client and defense counsel can make in the presentation of the PMK is deciding who the right person is to serve in that role. Several factors must be considered in making this choice. These include knowledge of the topics at issue in the deposition, ability to commit the time and attention to properly prepare, and the ability to communicate effectively to a jury. It is exceedingly rare that a corporate witness will naturally excel in all three of these areas; however, with a solid defense and preparation plan, PMKs can quickly improve.
Preparing the PMK for Deposition
Thorough and focused preparation of the PMK for deposition is critical. This should be done in an environment that is free from the daily distractions of business. The witness must be fully committed to the preparation process, and the corporate defendant must provide the time and support necessary for the witness to properly prepare.
Preparation should begin with a complete education of the history of the corporation, its business operations, products and services. The PMK does not need to know every word of every one of the thousands of potentially responsive documents. Rather the goal should be a mastery of key documents and defense themes and the ability to communicate those themes in response to plaintiff’s questions.
Merely going through the topics at issue in the deposition notice and reviewing key documents is not enough. The corporate witness must go through a series of mock depositions conducted by seasoned trial counsel. These mock examinations should be conducted in an atmosphere approximating an actual 30(b)(6) deposition, with a ‘plaintiff’ counsel conducting the deposition and a counsel defending with appropriate objections. This will teach the witness the proper pacing and cadence of questions and answers, leaving time for defense counsel to lodge objections.
These training sessions and mock examinations should utilize a broad assortment of plaintiff 30(b)(6) techniques. There should be a healthy dose of ‘reptile’ questions, e.g., “[Y]ou wouldn’t let a member of your family use a product you know could harm or kill them, right ma’am?” Counsel should also incorporate the use of classic plaintiff documents, such as key mileposts in the development of knowledge of asbestos hazards and documents generated by industry and trade groups related to dust hazards or compensation claims. The person playing the role of plaintiff’s counsel should liberally repeat themes and specific questions to put pressure on the witness to change his or her answer.
It is critical to take the time after these mock sessions to provide feedback on the witness’s answers and overall presentation. This includes an assessment of the witness’s manner of communication, e.g., voice inflection, eye contact with jury, avoiding evasive answers, etc. Counsel must also listen to what the witness tells them about their performance, their concerns and areas in which the witness feels additional preparation is needed.
Part of proper preparation includes a debriefing session after the deposition concludes. Each PMK should review and sign the deposition transcript and then counsel should set up a time to do a thorough review of the testimony with the witness regardless of whether the case proceeds to trial.
The Lack of Personal Knowledge Conundrum
Every so often a key decision comes from an appellate court that changes the landscape of an entire segment of toxic tort litigation. The California Court of Appeal’s decision in Ramirez v. Avon Products, 87 Cal.App.5th 939 (2023) certainly fits that bill.
The Ramirez case was a talc personal injury case brought against several defendants, including Avon. Avon filed a motion for summary judgment, relying on a declaration from Lisa Gallo (“Gallo Declaration”), an employee who did not begin to work at Avon until 1994, about halfway through the alleged exposure period of the 1970’s to 2007. The Gallo Declaration stated it was made on the declarant’s personal knowledge, but all but two of the Avon documents attached to the Gallo Declaration were from the 1970’s, well before Ms. Gallo’s time with the company. The trial court overruled the Ramirez’ objections and granted summary judgment in favor of Avon.
The Court of Appeal overruled the trial court’s decision, finding that there are only two types of witness: lay and expert. The court found there was no special category of corporate witness that allows them to offer opinions or speculate on matters for which they have no personal knowledge. In this case, Ms. Gallo was simply a fact witness and could testify only on matters to which she had personal knowledge. Any such testimony, and the documents cited in the declaration, were beyond the witness’s personal knowledge and would be considered inadmissible hearsay.
The impact of the Ramirez decision was immediate and stretched beyond the borders of California. Trial courts in other jurisdictions have ruled similarly. Corporate witnesses and their lead defense counsel scrambled on how to respond. Plaintiff’s counsel rejoiced, taking the position they could still seek the information they want from PMKs, even if that is also not based on personal knowledge, and have that testimony admitted as an admission. The issue is made even more challenging because the very nature of toxic tort litigation involves companies, products and components discontinued decades ago. This means that often there are is no current or former employees of the corporate defendant in existence that would have any personal knowledge of the matters at issue in the lawsuit.
The Defense Response to Ramirez
While the Ramirez decision certainly sent a shock wave through the toxic tort world, defense counsel and their PMK witnesses have the ability to respond. First, PMK witnesses should be retrained not to speculate on answers seeking admissions that are not based on their personal knowledge. When shown a document, a PMK should not offer opinion or speculate on the meaning of the document beyond what the document actually states.
Second, defense counsel will need to be more creative when seeking to prove affirmative points necessary for the defense of their client. Many documents are self-authenticating, such as ancient documents or government records. Records custodians or similar witnesses can authenticate other documents, such as business records. These documents can form the foundation for key defenses or defense themes, even if the PMK witness can’t speak to the document based on personal knowledge.
Third, counsel should strongly consider also designating their corporate designee as an expert witness. Experts are not limited to personal knowledge and can evaluate other information, including hearsay and hearsay documents, to form their opinions. This approach is not without risk, as the plaintiffs could challenge the qualifications of the expert and seek to limit or exclude their testimony. The plaintiffs could also ask the PMK/expert to assume certain facts and ask the witness hypothetical questions. Counsel must narrowly tailor the expert designation of the PMK to meet the goals of the defense. For instance, the witness could be designated as an expert in the history of the corporate defendant and the development, manufacture and sale of a particular product line. Jurisdictions like California require taking a hard look at this new and innovative approach.
The Counter Offensive: Using the PMK to Support the Defense Case
Many defense counsel have long believed that the best one can hope to do in presenting a corporate witness at deposition or trial is to simply avoid disaster. We have assumed for years that the PMK witness was purely defensive, parrying away the evidentiary thrusts of plaintiff’s counsel in hopes of holding their position in the case. Yet, is that truly all we can expect of the PMK witness; the voice of the corporation in a case seeking millions of dollars against our clients?
Use of Direct Examinations in PMK Depositions
Defense counsel rarely conduct a direct examination of his or her own corporate witness in a PMK deposition. They choose not to ask any questions, or merely ask a handful of questions necessary to clear up certain points made by plaintiff’s counsel. However, in jurisdictions where allowed, plaintiffs’ counsel love to use the prior testimony of PMK witnesses by designation to defeat motions or for affirmative evidence at trial. A direct examination conducted by defense counsel in the PMK deposition can give counsel in other cases and jurisdictions the option of reading in favorable PMK testimony to establish points favorable for the defense.
Support for Affirmative Defenses
Counsel should closely evaluate their affirmative defenses and what evidence will need to be presented to support those defenses. Here, corporate witnesses can be extremely effective. For example, they can be critical in providing testimony of the corporation’s position in support of the government contractor defense and in demonstrating the corporation’s reliance on specific government regulations. They can similarly authenticate key documents showing when warnings were applied to products. In talc litigation involving retailers, PMK’s familiar with purchase agreements and business relationships can show that the retailers did not make or alter a talc containing product and instead relied on the expertise of the manufacturers. This type of testimony also supports the innocent retailer statutes available in Texas and many other jurisdictions.
Using the Corporate Witness to Support Defense Themes
One of the greatest challenges we have as defense trial lawyers in toxic tort litigation is to humanize the corporate client. All of the great work we do in jury selection to try to identify anti- corporate jurors and separate the selected jurors from emotion and sympathy might be for naught, if we cannot make the jury understand that our clients are more than a legal fiction. Our clients need to be treated fairly at trial, and that begins with the face of the client, the corporate witness.
Witnesses testifying on behalf of the corporation in deposition and at trial must consistently set the tone of positive corporate culture. A corporation that always, today and in the past, strives to do the right thing. An entity that follows the law and treats employees, customers and others in the chain of commerce fairly and with respect. The PMK shouldn’t hesitate to show pride in their company and what they and the people they work with have built. Juries demand the truth, but they expect the corporate defendant to defend themselves, particularly through a voice in the courtroom; the PMK witness.
The PMK can also be used to support what is arguably the most important defense to them in mass tort cases: alternative exposure. Defense counsel must still put on evidence of asbestos content, exposure, no warnings and substantial factor causation in order to get other entities on the verdict form and assign them the bulk of fault in the case. However, the corporate witness should be prepared to provide valuable testimony regarding suppliers of asbestos or talc containing products or, components used in the client’s product or services and highlight the lack of information and warnings provided to the corporate defendant. This will give defense counsel a powerful argument to make in closing argument on why the jury should assign the vast majority of fault on entities not in the courtroom.
Perhaps the most important thing the PMK witness can provide is the basis to blunt plaintiff’s attempts to obtain punitive damages against the corporate defendant. In most jurisdictions, the standard for punitive damages against a corporate defendant is very high. The plaintiffs must typically show evidence of willful and wanton conduct, with a specific disregard for the safety of the plaintiff. Perhaps in the days of Johns Manville and Owens Corning evidence of such conduct existed. The defendants today are companies that may have used asbestos or talc in products long ago, with no evidence of the kind of conduct that would support punitive damages. Counsel should carefully prepare the corporate witness to address the elements of plaintiff’s punitive damage claim so they can be attacked through summary adjudication before trial or through directed verdict during the trial itself.
Conclusion
Like many other aspects of a successful defense to a toxic tort lawsuit, the key to identifying, preparing and presenting a corporate witness is to have a well-developed plan. National counsel and lead trial counsel must work as partners with decision makers in the corporate law department to develop the strategic PMK development plan. However, the plan should not be limited to the defensive posture. With the right witness and the right counsel, a PMK witness can be a valuable asset to the defense in the total war that is toxic tort litigation.
* Gordon Rees Scully Mansukhani
The author recognizes and thanks colleague and friend Ed Ullola for his contributions and thoughts regarding the PMK/expert discussion.
