__________________________________________ 

 

 

 

 

 

 

08 07 2012 

UNITED STATES OF AMERICA 

BEFORE THE FEDERAL TRADE COMMISSION 

OFFICE OF ADMINISTRATIVE LAW JUDGES
 

) 

In the Matter of ) PUBLIC 

) 

McWANE, INC., ) DOCKET NO. 9351 

Respondent. )

 ) 

__________________________________________) 

COMPLAINT COUNSEL’S OPPOSITION TO RESPONDENT’S MOTION 

IN LIMINE TO PRECLUDE COMPLAINT COUNSEL’S PROPOSED PROFFER 

OF INVESTIGATIONAL HEARING TRANSCRIPTS AT TRIAL

 Respondent’s Motion in Limine to Preclude Complaint Counsel’s Proposed 

Proffer of Investigational Hearing Transcripts at Trial (“Motion”) reflects Respondent’s 

refusal to follow the FTC Rules of Practice for Adjudicative Proceedings and this Court’s 

Scheduling Order. Respondent’s Motion seeks a blanket exclusion of evidence – all 

Investigational Hearing (“IH”) transcripts – that is expressly admissible under Rule 

3.43(b). Respondent’s Motion also seeks to circumvent Respondent’s obligations under 

this Court’s Scheduling Order to identify specific “objections to the designated 

testimony,” due on August 16, 2012. Without any specific examples of objectionable IH 

testimony designated by Complaint Counsel, Respondent’s Motion articulates no valid 

basis for the blanket exclusion of either party-opponent or third party IH testimony. 

Rather, Respondent attempts to exclude relevant, material, reliable, and thus, admissible 

testimony. Accordingly, this Court should deny Respondent’s Motion. 

Factual Background 

Complaint Counsel produced IH transcripts for 18 witnesses to Respondent at the 

beginning of Part 3 discovery. Castillo Decl., at ¶ 2 (explaining that there are 19 IH 

1 
 

transcripts because one witness had two IHs). Respondent deposed each IH witness. Id. 

at ¶ 3. 

During the depositions of the IH witnesses, Respondent examined the witness’ 

credibility and the bases for their prior testimony, and often asked IH witnesses to reaffirm their prior IH testimony. Id. at ¶ 3. Respondent relied on the IH testimony 

throughout discovery, and proposes to use deposition designations that include testimony 

incorporating the witnesses’ IH testimony. Id. at ¶ 5. Respondent’s expert also relied on 

IH testimony in the preparation of his expert report. Id. 

The depositions were brief, as Complaint Counsel and Respondent split single, 

seven-hour days with many witnesses who were directly involved in many aspects of the 

conduct challenged in the Complaint. Id. at ¶ 4. Given these time constraints, 

Complaint Counsel did not question witnesses during their Part 3 depositions on all areas 

covered in their IH testimony. Id. Respondent, Complaint Counsel, and the witnesses 

themselves frequently referred to their IH testimony, and Respondent marked many IH 

transcripts as exhibits to the depositions. Id. 

Analysis 

Respondent’s Motion moves to exclude all IH transcripts from evidence on the 

basis that IHs are inherently unreliable and would necessarily lead to undue delay and 

duplicative testimony. There is no basis for such a sweeping exclusion under Rule 

3.43(b). Indeed, Respondent does not cite a single line of testimony offered by 

Complaint Counsel, but instead raises generic arguments about IHs taken under the Part 2 

Rules. Respondent’s argument that IHs should be excluded because they are somehow 

less reliable than depositions is contrary to the plain language of Rule 3.43(b). 
 

Rule 3.43(b) requires admission of all evidence that is “relevant, material, and 

reliable,” unless that evidence is more prejudicial than probative, or its presentation 

would cause “undue delay, waste of time, or needless presentation of cumulative 

evidence.” 16 C.F.R. § 3.43(b). Significantly, the Commission amended Rule 3.43(b) in 

2009 to add language that expressly allows for the admission of IH transcripts: 

If otherwise meeting the standards for admissibility described in this paragraph, 

depositions, investigational hearings, prior testimony in Commission or other 

proceedings, expert reports, and any other form of hearsay, shall be admissible 

and shall not be excluded solely on the ground that they are or contain hearsay. 

Id. (emphasis added). In addition, Rule 3.43(b) requires admission of all relevant partyopponent statements. Id. (“Statements or testimony by a party-opponent, if relevant, 

shall be admitted.”) (emphasis added). 

The IH testimony in this case is reliable and would not lead to duplicative 

testimony or undue delay. The IH testimony of Respondent’s own employees is also 

admissible party-opponent statements. To the extent that any specific IH designations are 

objectionable, such objections should be resolved pursuant to the procedures set forth in 

this Court’s Scheduling Order for exchanging objections to specific designations on 

August 16, 2012. 

I. IH Transcripts Are Reliable 

Respondent does not claim that the IH transcripts taken in this investigation are 

irrelevant or immaterial. Respondent does not even claim that they are unreliable. 

Instead, Respondent claims that depositions are “much more reliable,” Motion at 1, 

because Respondent’s counsel had the opportunity to object and contemporaneously 

cross-examine witnesses. Because this is true of all IHs under the Part 2 Rules, see 16 

C.F.R. §§ 2.8 (c), 2.9(b), ruling for Respondents on this basis would require the exclusion 
 

 

 

 

of all IH testimony in every case – a consequence the Commission clearly did not 

envision when they explicitly amended Rule 3.43(b) to allow for the admission of IH 

transcripts.1 

Complaint Counsel provided Respondent with its deposition and IH designations 

on July 6 as called for in the Scheduling Order. None of these designations are cited in 

Respondent’s Motion. To the contrary, Respondent seeks to introduce at trial two of the 

four passages cited in its Motion as “unreliable” through its own designations.2 

Respondent’s four cherry-picked IH excerpts do not demonstrate the so-called 

unreliability of IH testimony, nor do they meet Respondent’s heavy burden to 

demonstrate that all IH testimony would be inadmissible for any purpose. See 

Hawthorne Partners v. AT&T Techs., Inc., 831 F. Supp. 1398, 1400 (N.D. Ill. 1993); Sec. 

Exch. Comm’n v. U.S. Environmental, Inc., 2002 U.S. Dist. LEXIS 19701, at *5-6 

(S.D.N.Y. Oct. 16, 2001). And Respondent cannot proffer two of the four excerpts as 

probative and relevant evidence in support of its case while using the same testimony to 

argue that Complaint Counsel’s designations, which are never excerpted or even cited in 

Respondent’s Motion, should be excluded. 

Respondent’s own reliance on the IH transcripts throughout discovery belies 

Respondent’s arguments against the reliability of the IH transcripts. Respondent 

frequently asked witnesses to re-affirm their IH testimony at deposition, often marked the 

witness’ IH transcript as a deposition exhibit, and Respondent’s own expert relied on the 

IH transcripts in developing his opinions for his expert report. Castillo Decl., at ¶ 3, 5. 

1

 16 C.F.R. Parts 3 & 4 Rules of Practice; Final Rule, 74 Fed. Reg. 1804 (effective Jan 13, 2009) (codified
 

at 16 C.F.R. § 3).

2 See Motion at 2-3; Castillo Decl., at ¶ 6. 
In short, Respondent’s own actions demonstrate the reliability of IH transcripts in this 

case. 

II.	 Admission of the IH Transcripts Will Not Unduly Waste Time Or Duplicate 

Evidence 

Respondent’s Motion also baselessly asserts that admission of any IH transcripts 

will waste time and duplicate evidence. Respondent’s Motion, however, never explains 

how admitting the IH transcripts would cause any undue delay. To the contrary, 

Paragraph 19 of the Court’s Scheduling Order ensures the opposite: IH and deposition 

transcripts will not be read into the record or presented in open court without the Court’s 

prior approval. 

Without offering a single example, Respondent also posits that a witness’s IH 

testimony is necessarily duplicative of subsequent deposition testimony and would result 

in the “needless presentation of cumulative evidence.” Motion at 5. In fact, many of the 

Part 3 depositions reference prior IH testimony and the IH transcripts were marked as 

deposition exhibits. This deposition testimony – much of which is designated to be 

offered as evidence at trial by Respondent – would be difficult to understand if all IH 

testimony were excluded. Castillo Decl., at ¶ 4, 5. Moreover, as explained above, given 

the substantial time constraints involved in a shared, 7-hour deposition, Complaint 

Counsel relied on the admissibility of IH transcripts under Rule 3.43(b) and did not 

always question witnesses on the same topics that were covered at their IH. Id. at ¶ 5. 

While Complaint Counsel does not doubt that there is some overlap between a witness’ 

IH and deposition testimony, such objections are best dealt with on an individual basis 

under the procedure set forth by the Scheduling Order. 
III.	 Respondent Has No Basis for Opposing Admission of IH Transcripts for 

McWane Executives 

Respondent’s Motion as it pertains to the IH transcripts of McWane executives 

must also fail. With respect to party-opponent testimony, 3.43(b) states, “Statements or 

testimony by a party-opponent, if relevant, shall be admitted.” See 16 C.F.R. 3.43(b) 

(emphasis added); cf. F.R.E. 801(d)(2)(D) (A statement of a “party’s agent or employee 

on a matter within the scope of that relationship and while it existed” is not hearsay.) 

Because Respondent does not argue that the testimony in these IH transcripts is not 

relevant, there is no basis to exclude the IH transcripts of the McWane executives, Leon 

McCullough or Rick Tatman. 

IV.	 Respondent’s Motion Lacks “Necessary Specificity” Required for a Motion 

In Limine and Ignores the Scheduling Order 

Finally, Respondent’s Motion should be denied because it is “too sweeping in 

scope” and fails to identify the specific IH testimony that should be excluded with 

“necessary specificity.” See Weiss v. La Suisse, Societe d’Assurances sur la Vie, 293 F. 

Supp. 2d 397, 407 (S.D.N.Y. 2003) (denying a motion in limine as sweeping and 

overbroad). These types of motions in limine are not only “discouraged,” see Scheduling 

Order at p. 3, but are also properly denied. E.g., Abbott Labs. v. Sandoz, Inc., 743 F. 

Supp. 2d 762, 783 (N.D. Ill. 2010) (denying over-inclusive motion since “specific 

objections . . . can be addressed at trial”). 

This Court’s Scheduling Order expressly establishes procedures and deadlines for 

handling any evidentiary objections to individual IH transcript designations. According 

to the Scheduling Order, parties must exchange objections to designated testimony on 

August 16, 2012, and any such objections are to be resolved by or before the final 
 

 

 

 

 

 

 

 

prehearing conference on August 30, 2012. Because Respondent’s Motion tries to 

circumvent this Court’s specific procedures for objections to designations of specific IH 

testimony, it should be denied. 

Conclusion 

For the above reasons, Complaint Counsel respectfully requests that this Court 

deny Respondent’s Motion. 

Dated: August 7, 2012 Respectfully submitted, 

/s/ Monica Castillo 

Edward D. Hassi, Esq. 

Geoffrey M. Green, Esq. 

Linda M. Holleran, Esq. 

Thomas H. Brock, Esq. 

Michael J. Bloom, Esq. 

Jeanine K. Balbach, Esq. 

J. Alexander Ansaldo, Esq. 

Andrew K. Mann, Esq.

 Monica M. Castillo, Esq. 

Counsel Supporting the Complaint 

 Bureau of Competition

 Federal Trade Commission

 Washington, DC 20580 

 Telephone: (202) 326-2470 

 Facsimile: (202) 326-3496 

Electronic Mail: ehassi@ftc.gov 
__________________________________________ 

 

 

 

 

 

 

UNITED STATES OF AMERICA 

BEFORE THE FEDERAL TRADE COMMISSION 

OFFICE OF ADMINISTRATIVE LAW JUDGES
 

) 

In the Matter of ) 

) PUBLIC 

McWANE, INC., ) 

Respondent. ) DOCKET NO. 9351 

) 

__________________________________________) 

DECLARATION OF MONICA M. CASTILLO 

Pursuant to 28 U.S.C. § 1746, I make the following statement: 

1.	 My name is Monica M. Castillo. I am making this statement in In the Matter of McWane, 

Inc., FTC Docket No. 9351, in support of Complaint Counsel’s opposition to McWane, 

Inc.’s Motion in Limine to Preclude Complaint Counsel Proposed Proffer of 

Investigational Hearing Transcripts at Trial (“Motion”). All statements in this 

Declaration are based on my personal knowledge as a Staff Attorney for the U.S. Federal 

Trade Commission, Bureau of Competition, and if called upon to testify, I could 

competently do so. 

2.	 Complaint Counsel produced the Investigational Hearing (“IH”) transcripts for all 18 

witnesses from its Part 2 investigations to Respondent at the beginning of Part 3 

discovery. There were 19 transcripts in total, since there were two investigational 

hearings of a single witness. 

3.	 During Part 3 discovery, Respondent deposed each IH witness. At deposition, 

Respondent examined the witness’ credibility and the bases for their prior testimony, and 

often asked IH witnesses to re-affirm their prior IH testimony. 
 

 

 

4.	 The Part 3 depositions were brief, as Complaint Counsel and Respondent split single, 7-

hour days with witnesses who were directly involved in many aspects of the conduct 

challenged in the complaint. Given these time constraints, Complaint Counsel did not 

question witnesses on all areas covered in the IH testimony. The deposition testimony 

referring to the IH testimony would sometimes be difficult to understand without being 

able to refer to the IH transcripts, since Respondent, Complaint Counsel, and the 

witnesses themselves made frequent references to the IH testimony. In addition, many 

IH transcripts were marked as exhibits to the depositions by both Respondent and 

Complaint Counsel. 

5.	 Additionally, Respondent’s expert reports cites that he relied on IH transcripts in the 

formation of his opinions and in the preparation of his expert report in this case. 

6.	 Complaint Counsel did not designate any IH testimony contained in Respondent’s 

Motion. However, two of the four passages of IH testimony that are excerpted by 

Respondent in its Motion are contained in Respondent’s own designations of testimony 

that it intends to introduce at trial. 

Pursuant to 28 U.S.C. § 1746, I declare, under the penalty of perjury, that the foregoing is 

true and correct to the best of my knowledge, information, and belief. 

 Respectfully submitted, 

 s/ Monica M. Castillo 

 Counsel Supporting the Complaint 

 Bureau of Competition

 Federal Trade Commission

 Washington, DC 20580 

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CERTIFICATE OF SERVICE 

I hereby certify that on August 7, 2012, I filed the foregoing document 

electronically using the FTC’s E-Filing System, which will send notification of such 

filing to: 

Donald S. Clark 

Secretary 

 Federal Trade Commission 

 600 Pennsylvania Ave., NW, Rm. H-113 

 Washington, DC 20580 

 I also certify that I delivered via electronic mail and hand delivery a copy of the 

foregoing document to: 

The Honorable D. Michael Chappell 

 Administrative Law Judge 

 Federal Trade Commission 

 600 Pennsylvania Ave., NW, Rm. H-110 

 Washington, DC 20580 

 I further certify that I delivered via electronic mail a copy of the foregoing 

document to: 

Joseph A. Ostoyich 

William C. Lavery 

Baker Botts L.L.P. 

The Warner 

1299 Pennsylvania Ave., NW 

Washington, DC 20004 

(202) 639-7700 

joseph.ostoyich@bakerbotts.com 

william.lavery@bakerbotts.com 

J. Alan Truitt 

Thomas W. Thagard III 

Maynard Cooper and Gale PC 

1901 Sixth Avenue North 

2400 Regions Harbert Plaza 

Birmingham, AL 35203 

(205) 254-1000 

atruitt@maynardcooper.com 

tthagard@maynardcooper.com 

Counsel for Respondent McWane, Inc. 
 

 

CERTIFICATE FOR ELECTRONIC FILING 

 I certify that the electronic copy sent to the Secretary of the Commission is a true 

and correct copy of the paper original and that I possess a paper original of the signed 

document that is available for review by the parties and the adjudicator. 

August 7, 2012 By: s/ Thomas H. Brock 

Thomas H. Brock 

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