Corporte Representatives: Fair Game at Trial?
DECIDING ON A CORPORATE REPRESENTATIVE
When defending a corporate or other legal entity, one of the many strategic decisions made prior to the start of a trial is the selection of the particular person to attend the trial throughout its duration as the corporate representative. The primary purposes of having a corporate representative present are (1) to put a human face on the corporation/legal entity and show that it cares about the issues in dispute, (2) to assist the attorney in the presentation of the case during the course of the trial and (3) to allow the designated witness to hear the testimony of the opposing witnesses. The importance of each function varies depending on the nature of the case and the amount in dispute.
Because the person designated as the corporate representative is exempt from the sequestration of witnesses, it is frequently tempting to designate an important witness as the corporate representative to allow him or her to listen to the testimony of the plaintiff’s witnesses. However, a smart plaintiff attorney can defeat this strategy by calling that person as an adverse witness before putting on the plaintiff’s key witnesses. Under the Federal Rules of Civil Procedure, the sequestration rule does not apply to pretrial depositions absent a special order, Fed. R. Civ. P. 30(c)(1), and in many jurisdictions, it is at least an open question as to whether deposition witnesses can be sequestered in the course of pretrial proceedings, with many attorneys taking the position that it does not apply. Therefore, the defendant’s witnesses should be familiar with the expected trial testimony of the other side’s witness and it is not necessarily critical that they be present in the courtroom and subject to being called as an adverse witness.
As a result, it is not uncommon for the corporate representative to be an individual with no or limited knowledge and/or involvement in the events giving rise to the lawsuit. Such a person is typically designated as the corporate representative for “appearance” purposes only. Nonetheless, the plaintiff’s attorney may see this as an opportunity to call the representative as an adverse witness and force him or her to admit to lacking knowledge of all critical facts notwithstanding his or her status as the company representative. Or, if the person designated as the representative had some involvement in the underlying events, the plaintiff’s attorney may ask questions about areas in which the person had no involvement, again, for the purpose of eliciting admissions of no knowledge.
PROTECTING THE “APPEARANCE” CORPORATE REPRESENTATIVE
Can the person designated as the corporate representative for appearance purposes only be protected from being called by the opposing side as an adverse witness in his or her capacity as a corporate representative? There is no rule specifically addressing this issue. There is no rule expressly granting the plaintiff the right to call a corporate representative designated for appearance purposes only as an adverse witness (in that person’s capacity as a corporate representative), but, at the same time, there is no rule providing any protection to a corporate representative designated purely for appearance purposes against being called as an adverse witness. However, there are a number of different rules which do come into play on this issue.
Initially, trial judges have great discretion in controlling litigation. A fairly standard requirement is that potential witnesses must be identified on witness lists exchanged by the parties. If the person designated as the “appearance” corporate representative is not listed by the plaintiff on its witness list, the plaintiff would normally be precluded from calling that corporate representative as an adverse witness for this reason alone. However, parties frequently include generic listings in their witness lists, such as references to “a corporate representative of the defendant,” or adopt the other party’s witness list, which may be deemed sufficient to include the corporate representative designated for purposes of appearance at trial. To avoid this possibility, defendants should move to strike any vague or generic listings of witnesses prior to trial.
Assuming the representative designated for appearance purposes is covered by the witness list, it could nonetheless be argued that allowing the plaintiff to call the representative as an adverse witness would effectively allow the plaintiff to designate the corporation’s representative on the particular subjects about which the representative is questioned. The principle underlying this argument is that only the corporation has the authority to designate particular representatives to speak on its behalf and bind it with respect to particular subject areas. The designation of an individual as a representative for an appearance at trial is not a designation of that person’s authority to speak to any particular subject. Thus, to allow the plaintiff to call and question that person in his or her capacity as a corporate representative is tantamount to allowing the plaintiff to designate the corporation’s representative.
While this reasoning has some intuitive appeal, there is no rule which specifically supports it. The rule which comes closest, and upon which the foregoing argument principally relies, is Rule 30(B)(6) of the Federal Rules of Civil Procedure and similar state rules. Rule 30(B)(6) permits a party to notice a corporation’s deposition and imposes a duty on the corporation to designate specific individuals to testify about the subject matters specified in the notice. However, this rule pertains to pretrial discovery and does not address calling a corporate representative at trial as an adverse witness. Further, Rule 32(a)(3) specifically grants a party the right to use for any purpose the deposition of either (1) the company’s officer, director or managing agent or (2) the representative designated by the company pursuant to Rule 30(B)(6). Rule 32, thus, suggests that perhaps the corporation’s right to decide which particular individuals will testify on its behalf is not absolute.
Nonetheless, as noted, the trial judge has broad discretion in controlling the course of the trial. Rule 611 of the Federal Rules of Evidence instructs the court to exercise control over the manner and order of presenting witnesses in order to avoid needless waste of time and protect witnesses from harassment or undue embarrassment. The rules of evidence also permit the trial judge to exclude irrelevant evidence or evidence which, while relevant, would be unfairly prejudicial. Rule 104 of the Federal Rules of Evidence provides that preliminary questions about the admissibility of evidence are to be determined by the court and should be done outside of the presence of the jury when required by the interests of justice.
Based on these rules, the defendant can argue that before the plaintiff is allowed to call to the stand as an adverse witness a person designated as a company representative for appearance purposes only, the court should inquire into the plaintiff’s areas of examination. After all, if the plaintiff merely intends to ask a series of questions about which the individual has no knowledge, then the evidence is irrelevant in all probability or, at a minimum, unfairly prejudicial to the defendant corporation. If the individual has knowledge of some areas, then the questioning should be limited to those areas. In the alternative, the defendant can argue that the individual should be called only in his or her individual capacity so that a foundation can be laid to determine whether that person’s testimony is binding on the defendant corporation.
Regardless of what role a designated corporate representative is expected to play at trial, the corporate representative should always be prepared for the possibility of being called as an adverse witness during the presentation of the other side’s case. Particularly if the designated representative had little or no involvement in the events underlying the litigation, the corporation’s attorney should be prepared to fight any attempt to call the designated representative as an adverse witness, at least in his or her capacity as a corporate representative, by insisting that the designated person not be allowed to be called unless specifically identified on a witness list and, if the person is so identified, relying on arguments of relevance and unfair prejudice.