; if the witness is not available to testify in person. Wright. Miller & Marcus, Federal Practice and
Procedure. Civil 2d § 2142.7 As the court noted Jn re Coca-Cola Co., 117 F.T.C. 795 (1994), a
party is entitled to require a witnesses” attendance al inal despile his previous deposition “since
the purpose of depositions is to prepare for trial, not to scrve as a substitute for live testimony in
court.” én re Coca-Cola Co., 1990 FTC LEXIS 204, at *t (June £2, 1990),

Respondents cile three reasons why depositions should be allowed in lieu of live
testimony for certain third-party witnesses: travel time to Washington D.C., busy work schedules,
and holiday travel plans. Respondents’ Motzon (9-15. These rationales amount ta mere
inconvenience, rather than a real inability to attend the trial as required under FTC Rule
3.33{(g)GIi)(AHE).

Further, the reasons cited by Respondents in support of their motion can not withstand
analysis. The most distant location where any of the witnesses ciled by Respondents live is the
Houston metropolitan area, about a three and one half hour airplane trip from Washington D.C.
Both Complaint Counsel and Responde!. will call live numerous third-party witnesses from the
Houston area, In fact, four of the five third-party witnesses that Respondents intend to call live
(witnesses identified as third-party wilness number 3, 4, 8 and 12 on Respondents’ Final Witness

List) live in the Houston metropolitan area; the fifth (Respondents’ third-party witness number 5}

? The preference for live testimony is deeply embedded throughout the Federal Rules of
Civil Procedure. For example, the advisory committee note on Rule 43(a), which allows for the
presentation of testimony by contemporanevus transmission [rom a different Jocation (1.e., video)
under compelling circumstances, states the following:

The importance of presenting live testimony in court cannot be forgotten. The very
ceremony of trial and the presence of the factfinder may exert a powerful force for
truthtelling. The opportunity to judge the demeanor of the witness face-to-face is
accorded great value in our tradition.

5.


purposes of cross examination and would have the witness confirm the statements in the
declaration. These statements record the perception of the witness at the time of the acquisition.
The declaration is attached to Respondents’ Motion as Exhibit L. During the deposition,
Respondents cross examined the witness regarding the contents of the declaration. The
deposition testimony of the witness should not be accepted in evidence without receiving in
evidence, as well, the wimess’s declaration.
CONCLUSION

Respondents have met neither the conditions necessary for the use of depositions in licu
of live testimony under FC Rule 3.33 (g)(1 iii), nor the conditions set out in this Court’s letter
of September 17, 2002, to the parties relating to tial logistics. Complaint Counsel would be
highly prejudiced by the admission of depositions in lieu of live destimony for these nine third-
party witnesses. Accordingly, Respondents’ Motion to Call Certain Witnesses by Deposition
should be denicd.

Respectfully submitted,

Steven L. Wilexky

Federal Trade Commission
601 New Jersey Avenue, N.W.
Washington D.C. 20580
(202) 326-2650

Counsel Supporting the Complaint
Dated: November 5, 2002

-10-


depositions in lieu of live testimony.

LL, Respondents Can Not Meet the Standards Set Out by this Court for the Use of
Depusitions in 1.ieu of Live Testimony

On September 17, 2002, this Court issued a letter to the parties stating that “Judge
Chappell will allow the usc of properly offered and admitted depositions of third parties in lieu of
live testimony where such use is agreed to by both sides.” (italics added). This Court has
conditioned the use of depositions m heu of live testimony on the mutual consent of the parties.
The parties agreed to the use of depositions, in lieu of live testimony, of six witnesses with
respect 10 which the parties elected to dispense with cross examination at trial. Absent
extraordinary circumstances, as sct forth in Rule 3.33(g)(1}Gii), Complaint Counsel have the
Tight to cross examinic Respondents’ witnesses and to confront Respondents’ witnesses with
evidence developed following the depositions, including evidence that Respondents have acted in
a voncompetitive manner wilh respect to the prices Respondents have quoted to (he companies
these witnesscs represent.

Respondents’ citation to Complaint Counsel's Response to Respondents’ Motions
Conceming the Use of Transcript Excerpts, in re Schering Plough Corp. at T-8 (Respondents’
Exhibit F) for the proposition that depositions are regularly admitted in lieu of live testimony in
FTC adwinistrative hearings is misplaced. Respondents’ Motion 8. Sixty of the 61 witnesses
for whom Complaint Counsel sought to have deposition testimony admitted, in lien of live
testimony, in Schering Plough were employces or experts of respondent or its co-conspirator.
Complaint Counsel’s Response to Respondents’ Motions Concerning the Use of Transeript

Excerpts, /n re Schering Plough Corp, at 11. Pursuant to Rule 3.33(g}(1)(ii), the deposition ofa

-7-


lives in Washington state. CB&I Letter (Oct. 8, 2002), Respondents lave offered no rationale
why the journey to Washington D.C. is any more arduous tor some third-party witnesses than for
others. In fact, Complaint Counsel and Respondents intend to calf live witnesses from as [ar
away as Alaska, California, and Washington stale,

Respondents note that the third-party witnesses at issue have “extremely pressing job
responsibilitics that prevent them from traveling to Washington.” Respondents’ Motion {1 3-14.
Many of the third party wimesses Complaint Counsel and Respondents intend to call live are
busy, high-level executives or principals in small businesses. For example, Respondents have
stated thal they intend to call live Respondents’ third-parly witness number 8 is a vice president
of engineering for an oil and gus exploration company and Respondents’ third-party witness
number 12 is a senior vice president of a major power producer. CB&I Letter (Oct. 8, 2002).
Respondents have offered no evidence that the third-party witnesses they propose to call by ~
deposition are any busier than those they will present Jive.

Finaily, Respondents note that the trial may interrupt holiday travel plans of various
witnesses. Respondents’ Motion 15. This trial was originally set to begin on September 10,
2002. The trial date was extended 60 days to November 12, 2002 al the request of Respondents.
Respondents were aware, at the lime they requested the extension, that the extension they
proposed would push the trial into the holiday season. Indeed, Complaint Counsel wamed, in its
opposition to Respondents’ motion, that Respondents’ requested 60-day extension would push
the hearing into the holidays and might inconvenience some witnesses. Complaint Counsel’s
Response to Respondents’ Motion for a Sixty-Day Extension of Time at 2. Accordingly,

Respondents should not now be heard to raise witnesses’ holiday travel plans as an excuse to use

-6-


waive objection to use of leading questions in eliciting direct testimony at trial, because
Complaint Counsel permitted Respondents to conduct their discovery depositions as
Respondents saw fit. Respondents’ proposal, after the fact, to use discovery depositions, over the
objection of Complaint Counsel, in lieu of live trial testimony of Respondents’ third-party
witnesses circumvents the rules of evidence. FIC Rule 3.41(d) provides that “An adverse party,
or an officer, agent, or employee thercof, and any witness who appears to be hosule, unwilling or
evasive, may be interrogated by leading questions .. ..” The Rule does not grant license to use
leading questions for direct testimony by substituting discovery depositions for proper
examination of witnesses at trial.

Moreover, many of these discovery depositions took place more than three months ago.
Evidence developed subsequent to the depositions, that wil] form a basis for cross examination of
the witnesses, reveals that Respondents have engaged in noncompetitive pricing behavior with
Tespect to the campanies some of these witnesses represent. See, ¢.y., Complaint Counsel’s
Pretrial Brief at 30-31. Further, Complaint Counscl have a right to cross examine the witnesses
with respect to industry developments subsequent to the depositions. Customers may have
received budget pricing or estimates on relevant products since their depositions or may have had
further experience in dealing with suppliers, which could affect their testimony. Two of the
witnesses are employccs of The Williams Companics, which sold its Cove Point LNG facilily to
Dominion Resources, Inc. on Sept. 5, 2002. Respondents disclose, in their Supplement to
Respondents’ Mation to Call Certain Witnesses by Deposition, filed November 4, 2002, that the
two witnesses have been assigned to other duties al Williams. Respondents’ Supplement q 3.

At trial, Complaint Counsel would use the sworn declaration of one of the witnesses for

9.


UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION

PITT-DES MOINES, INC.

a corporation.

)

In the Matter of )

* }

CHICAGO BRIDGE & IRON COMPANY NV. }

}

a foreign corporation, }

)

CHICAGO BRIDGE & TRON COMPANY )

)

a corporation, }
) Docket No. 9300

and )

)

)

)

)

)

To: The Honorable D, Michael Chappell
Administrative Law Judge

COMPLALNT COUNSEL’S OPPOSITION TO RESPONDENTS’
MOTION TO CALL CERTAIN WITNESSES BY DEPOSITION

Respondents have met neither the conditions necessary for usc of deposition testimony in
lieu of live testimony under FTC Rule 3.33 ()(1Xiii), nor the conditions set out in the Court's
letter of September 17, 2002, to the parties relating to trial logistics. The nine third-party
witnesses are available to testify at trial, und Respondents have made no showing that they have
been unable to procure the attendance of the witnesses at trial. Respondents failed to notice, at
the time the discovery depositions of these witnesses were noticed or conducted, that they
intended to use the depositions in lieu of live testimony over the objection of Complaint Counsel.
Complaint Counsel would be severely prejudiced if it is denied the opportunity to cross examine

the nine third-parly witnesses who Respondents now propose to present by transcript of


11 IS FURTHER ORDERED that Respondents may present the testimony of these

witnesses live,

ORDERED

D. Michael Chappell
Administrative Law Judge

Date: November , 2002



UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION

in the Matler of

CHDCAGO BRIDGE & TRON COMPANY N.Y.
a foreign corporation,

CHICAGO BRIDGE & IRON COMPANY

a corporation,

Docket No. 9300
and

PITT-DES MOINES, INC.

a Corporation.

a a)

ORDER

On November 1, 2002, Respondents filed a Motion to Cali Certain Witnesses by
Depusition, and on November 4 Respondents fiied a Supplement thereto. Complaint Counsel
filed an Opposition to Respondents’ Motion on November 5, Having considcred Respondents’
Motion and Supplement and Complaint Counsel’s Opposition thereto, the Court finds that
Respondents have not met the conditions required under FTC Rule 3.33 (g){1)(iit). 16 CFR.
3.33 {g)(1)(iii), or the conditions set gut in this Court’s letter of September 17, 2002, for the use
of depositions in licu of live testimony for the nine third-party witnesses at issue.
Accordingly,

IT IS HEREBY ORDERED that Respondents’ Mation to Call Certain Witnesses by

Deposition is demicd in its entirety.



party may be used by an adverse party for any purpose. As explamed above, the individuals al
issue in Respondents’ current motion are all third-partics.

YO. Complaint Counsel Would Be Prejudiced by the Use of Deposition in Lieu of Live
Testimony for the Witnesses at [ssuc

“ The nine third-party witnesses are available to testify at trial, and Respondents have not
made any of the showings requited by Rule 3.33(g){1){iii) to warrant use of depositions, in lieu
of live testimony, at trial. Complaint Counsel would be highly prejudiced if Respondents’
Motion is granted.

Respondents failed to notice, at the time the discovery depositions of these witnesses
were noticed and conducted, that they intended to use the depositions af these witnesses in lieu of
live testimony over the objection of Complaint Counsel. Complaint Counsel took discovery of
these witnesses during the depositions and asked questions appropmite la discovery, Complaint
Counsel did not cross examine the witnesses, because Complaint Counsel expected. in good
faith, that it would have an opportunity to do so at trial. At the time the depositions were
conducted, Complaint Counsel had no reason to expect otherwise. Further, Complaint Counsel
did not exhaust every material linc of questioning with each witness. Complaint Counsel had no
reason to betieve that if it failed to pursue a particular line of questioning in a deposition, it
would lose the ability to pursuc those issues later at trial.

Further, Respondents elected to use leading questions in conducting their examination of
the witnesses, a3 is their right in conducting discovery. Complaint Counsel did not interfere with
Respondents’ discovery of the witnesses, At trial, Complaint Counsel will object to use of

leading questions in conducting direct examination of wimesses. Complaint Counsel did not


attendance of the deponent by subpocna, or

(E) That such exceptional circumstances exist as to make it desirable, in

the interest of justice and wilb duc regard to the importance of presenting

the testimony of witnesses orally in open hearing, to allow the deposition

lo be used.
FIC Rule 3,33(g}(1 (iti(A)-(E). Signally, the Rule emphasizes the “importance of presenting
the testimony of witnesses orally in open hearing,” fd, That is what Compiaint Counsel
expected would happen here and that Respondents’ claims could be tested by cross-examination

“(he greatest legal engine ever invented for the discovery of truth.” United Siates v. Green, 399

U.S. 149, 158 (1970).

Respondents hase their argument for use of depositions in licu of live testimony on Rule
3.33(2)(1Miii)(B), which states that a party may use a deposition for any purpose if the
Administrative Law Jude Gris that “the deponent is out of the United States or is located at
such a distance that his attendance would be impractical .. ..” Respondents’ Motion 7. The
language of Rute 3.33(gX1) closely follows (he Janguage of Fed. R. Civ. P. 32(a)(3) and the
language of Fed. R. Evid. 804{b)(1}, both of which adopt an unavailability standard for use of
depositions in lieu of live testimony. Fed. R. Evid. 804(6)(1) treats deposition transcripts as
hearsay, which are only acceptable in lieu of live testimony if the declarant is unavailable. The

Testriclions imposed by Fed. R. Civ. P. 32 codify the long-established principle that testimony by

deposition is less desirable than oral testimony and should ordinarily be used as a substitute only

‘ Fhe Rule, however, also recognizes that depositions of parly witnesses ace admissions,
not hearsay, and may be introduced in evidence by an adverse party without 2 witness. Rule
3.33(g){1)Gi). This provision does not apply here as all the proposed witnesses under
Respondents’ motion are third parties.

-4.


FACTUAL BACKGROUND

On September 17, 2002, this Court issued a lelter to the parties staling that “Judge
Chappell will allow the use of properly offered and admitted depositions of third parties in lieu of
live testimony where such use is agreed to by both sides.” The partics cngaged in negotations
relating to the use of depasition testimony of various witnesses and reached an agreement
relating to several witnesscs. Complaint Counsel has not agreed to use of depositions in lieu of
live testimony for nine third-party witnesses referenced in Respondents’ Mation because
Complaint Counsel intends to cross examine these witesses af trial.

ARGUMENT

I. Respondents Can Not Meet the Standards Set Out in FTC Rule 3.33()(E) for the Use of
Deposition In Lieu of Live Testimony

FIC Rule 3.33{g)(1) sets out the standards for the use of deposition testimony in FTC
administrative hearings. Ordinarily, depositions of third partics may only bc used to contradict or
impeach the testimony of [he depouent. FTC Rule 3.33(2)(|)(i). Depositions of third parties
may be used for any purpose, including for use in lieu of live testimony, onfy if the
Administrative Law Judge finds:

(A) That the deponent is dead; or

(B) That the deponent is out of the United States or is located at such a
distance that his attendance would be impractical, unless it appears that the
absence of the deponcnt was procured by the party offering the deposition;
or

(C) That the deponent is unable to attend or testify because of age,
sickness, infirmity, of imprisonment; or

(D) That the party offering the deposition has been unable te procure the

3.


discovery depositions.

None of these witnesses are “dead,” “out of the United States or is located at such a
distance that his attendance would be impractical,” “unable to attend or testify hecause of age.
sickness, infirmity, or imprisonment,” nor have Respondents even attempted to show that thcy
cannot “‘procure the attendance of the deponen! by subpoena,” or “[t]hat such exceptional
circumstances exist as o make it desirable, in the interest of justice and with duc regard to the
importance of presenting the testimony of witnesses orally in open hearing, to allow the
deposition to be used.” FTC Rule 3,33(g)(1)(ii)(A)-(E).

Instead, after consultation with their witnesses, they have decided that these witnesses arc
too busy or that a trip to Washington, DC would be inconvenient between the Thanksgiving and
Christmas holidays. None of these reasons is allowed under the Rule. Nor could Complaint
Counsel ever reasonably expect that when Respondents moved to have this hearing postponed for
two months that they would use that as an excuse to take away from this Tribunal and the
Commission the Rule’s express preference for “presenting the testimony of witncases orally in
open hearing.” In shart, Respondents put themselves in this position and cannot claim that they
have somehow created “special circumstances” warranting an excuse for nine of the thirteen
third-party witnesses on their witness list. Accordingly, Respondents’ Motion to Call Certain

Witnesses by Deposition should be denied.

2-


CERTIFICATE OF SERVICE

Lhereby certify that [ caused a copy of Complaint Counsel’s Opposition ta Respondents’
Molion to Call Certain Witnesses by Deposition to be delivered by hand to

The Honorable D, Michael Chappell
Federal Trade Commission

. H-104
6” and Pennsylvania Ave. N.W.
Washington D.C. 20580

Administrative T.aw Judge
and by facsimile and by first-class mail to:

Jeffrey A. Leon

Duane M. Kelley
Winston & Strawn

345 W. Wacker Drive
Chicago, IL 60601-9703
(312) 558-5600

Counsel for Respondents Chicago Bridge & Iron Company
N.Y. and Pitt-Des Moines, Ine,

Dated: Navernber 5, 2002

Steven wey