Designating a Corporate Witness for Deposition

Counsel for a corporate entity and those chosen to speak for it at deposition must work together. Several years ago two corporate designees of a co-defendant offered differing interpretations of their company’s internal requirements. Each was then led by the examining attorney to place differing obligations upon the corporate parent. Defense counsel failed to properly prepare those witnesses and uncover the problem beforehand. The company failed to adequately describe and disseminate its requirements. The employees failed to recognize ambiguity and seek clarity.

Corporate entities and their counsel must be keenly aware of the rules regarding “corporate rep deps” and the binding effect of such depositions. Federal Rule of Civil Procedure 30(b)(6) and New Jersey Civil Practice Rule 4:14-2(c) are virtually identical. A party may name as the deponent in a deposition notice the corporate entity itself and describe with reasonable particularity the matters on which examination is requested. In response, the entity so named shall designate one or more officers, directors, managing agents, or others who consent to testify on its behalf, and set forth for each the matters on which they will testify. The designees shall testify as to matters known or reasonably available to the entity.

Use of the rule is not limited to parties to a lawsuit. In serving a subpoena upon a non-party organization, it is incumbent upon the noticing party to advise the non-party organization of its duty to make designations and proceed according to the rule.

The use of the corporate designee process does not preclude the taking of a deposition by other procedures, including naming individual employees as deponents. The parties have the option to stipulate in writing, or the court may order, that a deposition be taken by telephone or other remote electronic means. In such an instance the deposition is considered taken in the place where the deponent is to answer questions. The notice may also be accompanied by a request to produce documents and other tangible things at the taking of the deposition.

The “ignorance is bliss” approach of some to the designation of corporate witnesses is fraught with peril. It runs afoul of the requirements of the rule and exposes the entity to sanctions. In caselaw several circuits have made it clear that the noticed corporate party must make a conscientious good faith effort to provide deponents who have knowledge, and to prepare those deponents to answer as completely as possible appropriate questions within the scope of the notice.

As a further practical matter, ignorance presents not bliss but other potential problems. If appropriately phrased questions concerning the knowledge of the corporate entity are answered with “I don’t know,” the consequences can be devastating. In a current product liability action the uninsured product manufacturer is long bankrupt. The selling retailer’s corporate designee testified that the retailer had been notified of a product recall and had concerns about the product’s safety as a result, but could not state any measures the company took to investigate or to determine whether the product it continued to sell was unsafe. The designee further testified that the company continued to represent to purchasers that the product was safe but really did not know whether or not that was true. This deponent’s ignorance will produce bliss only for the plaintiff in the case.

By rule, the corporate designee testifies as to the matters produced and thereby binds the producing entity. That testimony can and will be presented, in motions and at the time of trial, not as the testimony of John Smith, an individual employee, but rather as the voice of the corporate entity, speaking through its own chosen spokesperson. That testimony may bind not only in the instant matter but in subsequent matters where the same topics are involved. This effect can become particularly important in matters where the nature of the product or device being sold is such that repetitive claims on the same topic may be made. A misspeaking corporate designee at one such early deposition can haunt the company for some time.

While the language of the rule specifically mentions officers and directors, in product liability and medical device cases more often than not the appropriate designee will be one or more people from the engineering, design and quality assurance departments. The corporation’s choice as the contact person for litigation counsel should be an individual who is capable of not only describing the technical aspects of the product to litigation counsel, but also to adversaries and ultimately to jurors. The corporation may want to select the same person to be its corporate designee in response to a deposition notice. Doing so will maximize the return on educating a witness and minimize the likelihood of inconsistent or misspoken testimony.

To the extent that it is not possible to utilize the individual within the corporate entity dealing with litigation counsel on the technical aspects of the product as the corporate designee, additional witnesses with other areas of expertise within the company should be chosen for deposition with an eye toward later producing the same individual as the corporate designee at trial. The fewer chefs in the kitchen the better, not only in the case at hand, but in future litigation as well. A knowledgeable, experienced employee can testify as a fact witness and an in-house expert at time of trial. With that in mind, the ability of that witness to present, educate and make a credible and knowledgeable appearance is at a premium. Though engineering and science play key foundation roles, litigation savvy is another major plus, and corporations should consider which employees have the most experience in the litigation arena.

Simply put, it is worth a company’s effort to consider with care at the outset of litigation, particularly litigation which may have a repetitive nature, who should be involved as its technical contact and source, its likely corporate designee on those matters, and its ultimate trial witness.

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