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Conducting Discovery Beyond the Code « Goodman Neuman Hamilton LLP
Articles: Conducting Discovery Beyond the Code
Originally published in California Civil Litigation Reporter (May 1998), by Joshua S. Goodman and Farley J. Neuman.
The Code of Civil Procedure sets forth a broad range of discovery tools for gathering relevant information and obtaining admissible evidence, covering everything from expert opinions and medical examinations to document production and face-to-face sworn examinations. Yet, despite the number of statutory discovery tools available, few experienced attorneys limit themselves to the ones specified in the Code. When attorneys do use statutory discovery tools, they frequently modify these procedures by agreement among counsel. This article highlights many of the discovery tools not set forth in the Code (what is usually referred to as “informal discovery”) and some of the stipulations that can make statutory discovery more efficient and more effective.
Three of the most common methods of informal discovery are interviewing witnesses, obtaining publicly available information and documents, and conducting surveillance. These discovery tools have three principal advantages over formal discovery:
They tend to be less expensive than formal discovery;
They provide greater flexibility than formal discovery; and
They allow one party to obtain information without providing it to all other parties.
For example, a deposition in a multiparty case may last for several days and require significant preparation, especially in cases involving large numbers of documents. Because CCP §2025(f) only permits a natural person to be deposed once as a matter of right, that deposition will probably be the only opportunity any party has to depose that witness. Also, because §2025(d) requires notice of all depositions to all parties, any information obtained during that deposition becomes available to all parties. By contrast, an interview of that witness is usually less expensive, would not preclude a subsequent interview or deposition of that same witness, and would not reveal any information to other parties. Of course, informal discovery is not without its drawbacks, as discussed more fully below. Thus, careful consideration should be given to the appropriate uses of informal discovery.
Issues To Consider When Deciding Whether To Interview a Witness
In addition to the potential cost savings and increased flexibility of witness interviews, the lack of formality and absence of an adversary can be distinct advantages. For example, business clients are frequently reluctant to have depositions taken of their best customers, preferring an informal, nonadversarial interview, even though it may present significant litigation risks (discussed below). Also, some witnesses are more forthcoming in a less formal setting than they would be in the presence of a court reporter and a room full of attorneys.
Interviewing a witness may also help an attorney decide whether to conduct a deposition of that witness. An interview can establish the extent to which a witness is adverse or even hostile to one party or another, whether an opposing attorney has contacted that witness, and whether the witness has any plans to leave the area.
If the interview reveals that the witness has evidence that will be damaging to the interviewing attorney’s client, that attorney might decide to depose that witness to avoid surprise at trial, or might decide not to depose the witness in the hope the testimony will not reach the courtroom. That attorney will have to make a judgment as to whether any other party is aware of, or is likely to become aware of, that witness, whether the case is likely to settle before any other party learns of the damaging testimony, and whether the witness will be available for trial.
A similar decision is presented by the interview that reveals favorable testimony. Deposing the witness preserves the testimony for trial, but it also reveals it to the other parties. Those parties may be able to undermine the effectiveness of the witness’s testimony at trial as a result of the deposition.
Nonetheless, an attorney possessing information gleaned from an interview, whether it reveals favorable or damaging information, is in a better position to make decisions as to what witnesses to depose.
Whether the Dangers of a Deposition Outweigh the Benefits of a Predeposition Interview
When an interview suffices, the expense of the deposition is spared, and the information is not revealed to the other parties. Of course, another party may serve discovery to learn the identities of witnesses who have been interviewed, or to obtain the written or recorded statements. However, the identities of witnesses interviewed by counsel and recorded by counsel in notes or otherwise are protected by a qualified attorney work-product privilege. Nacht & Lewis Architects, Inc. v Superior Court (1996) 47 CA4th 214, 217, 54 CR2d 575. This information will tend to reveal counsel’s evaluation of the case by identifying the persons who claimed knowledge of the incident from whom counsel considered it important to obtain statements. Keep in mind, though, that because the privilege protecting counsel’s interview of the witness is only qualified, counsel may be compelled to reveal the information obtained in the interview. Notes or recorded statements taken by counsel, however, are protected by the absolute work-product privilege because they reveal counsel’s “impressions, conclusions, opinions, or legal research or theories” within the meaning of CCP §2018(c). Nacht & Lewis Architects, Inc. v Superior Court, supra.
On the other hand, the identities of potential witnesses who turned over to counsel their independently prepared statements would not reveal counsel’s evaluation of the case and, thus, do not enjoy any work-product protection. By the same token, statements written or recorded independently by witnesses neither reflect an attorney’s evaluation of the case nor constitute derivative material, and therefore are neither absolute nor qualified work product. 47 CA4th at 217. Although Nacht does not specifically define what constitutes an “independently” recorded or written statement, the court’s reasoning implies that any recording, whether by audiotape or by court reporter, of the attorney’s interview of the witness would be privileged.
Even when a previously interviewed witness must be deposed, the interview provides a road map for the attorney, who now as a result of the interview has a good sense of what the witness will say. An attorney who has conducted an interview before the deposition may be able to avoid certain problem areas in the testimony, and may be able to phrase specific questions so as to minimize the adverse impact of any testimony. If the witness is friendly, the attorney may choose to explain to the witness what the opposing counsel is likely to do at the deposition to undermine that witness’s testimony. If the witness changes his or her testimony during the deposition, the interview can be used to impeach the witness or to refresh the witness’s memory. The effectiveness of impeachment will depend, in part, on how the interview was conducted (see below).
Whether the Interview Is Ethical
One of the thorniest issues concerning witness interviews is whether there are ethical considerations that should prevent an attorney from interviewing a particular witness or restrict the scope of the interview. While an attorney is not permitted to communicate with an opposing party represented by counsel, an attorney generally is permitted to communicate with a witness who is not a party to the case. See Cal Rules of Prof Cond 2–100. However, special rules and limitations apply to present and former employees, directors, and officers of a corporate party to the litigation.
Generally, an attorney has a right to meet ex parte with ex-employees of a corporation that is an adverse party, even if they were managerial employees. Continental Ins. Co. v Superior Court (1995) 32 CA4th 94, 119, 37 CR2d 843; Bobele v Superior Court (1988) 199 CA3d 708, 714, 245 CR 144. Although counsel may not inquire about privileged communications, inquiry may be made with regard to relevant facts. State Farm Fire & Cas. Co. v Superior Court (1997) 54 CA4th 625, 652, 62 CR2d 834. The opinion in Continental Ins. Co. v Superior Court, supra, contains a good overview of these issues and their development in the law.
Ex parte communications with current employees of an adverse corporation are somewhat more complicated. California Rule of Professional Conduct 2–100 permits opposing counsel to initiate ex parte contacts with present employees (other than officers, directors, or managing agents) who are not separately represented, as long as the communication does not involve the employee’s action or failure to act in connection with the matter, which may bind the corporation, be imputed to it, or constitute an admission of the corporation for purposes of establishing liability. Triple A Machine Shop, Inc. v State (1989) 213 CA3d 131, 141, 261 CR 493. The exact scope of permissible inquiry, however, is not clearly defined. Presumably, a current, nonmanagerial employee cannot be questioned about his or her role in the events giving rise to the lawsuit, because that employee’s actions could be imputed to the corporation for purposes of establishing liability. Whether that employee can be questioned about coemployees’ actions, corporate policies and procedures, or factual observations of the events at issue is unclear.
Although an attorney’s interview of a current employee of an adverse corporate party is limited or prohibited once that attorney knows the corporation is represented by counsel, Rule 2–100 does not prohibit ex parte contacts when the attorney does not know the corporation is represented by counsel. For example, an attorney representing a potential plaintiff may contact current employees of the potential defendant before suit is filed as part of the process of investigating the merits of the claim. Jorgensen v Taco Bell Corp. (1996) 50 CA4th 1398, 1403, 58 CR2d 178. The knowledge or presumption that the potential defendant has “house counsel” does not trigger the application of Rule 2–100, unless the claimant’s attorney in fact knows that such house counsel represents the person being interviewed when the interview is conducted. 50 CA4th at 1402.
Even interviews of current employees conducted after suit is filed may be permitted. In Truitt v Superior Court (1997) 59 CA4th 1183, 69 CR2d 558, the court was faced with communications by an investigator for plaintiff’s counsel that would have violated Rule 2–100, if plaintiff’s counsel knew that the defendant corporation was represented by counsel in the matter at the time of the communications. 59 CA4th at 1187. Although the communications occurred after suit was filed, they were held to be permissible because they occurred before the answer was filed, which was the first time plaintiff’s counsel had actual knowledge that the defendant corporation was represented in this matter. 59 CA4th at 1189.
Before conducting interviews of current employees of an adverse corporate party, counsel should consider these ethical issues carefully. Counsel who conducts an interview in violation of Rule 2–100 runs the risk of being disqualified from the case and sanctioned. Because these issues are complex and can be hotly contested, the benefits of the interview may not justify the risks. For further discussion of the issue of ex parte interviews, see California Civil Discovery Practice, chap 3 (3d ed Cal CEB 1998).
How To Minimize Disadvantages of the Interview
Even when interviewing a witness is permitted, interviews present several disadvantages:
The testimony is not preserved for trial if the witness dies or otherwise becomes unavailable.
Because an interview does not usually result in sworn testimony, it may be difficult or impossible to impeach the witness at trial.
Interviewing a witness may undermine that witness’s effectiveness at trial by creating the impression of bias or interference by counsel.
Therefore, before conducting a witness interview, counsel should consider how best to conduct the interview so as to minimize these disadvantages. Options for conducting witness interviews include:
Written or recorded statements. Even in the absence of a deposition, it may be possible to impeach a witness by a prior written or recorded statement. Evid C §§1235–1238. Although the witness’s statement can be memorialized with a tape recorder or by asking the witness to sign a written statement, using a court reporter should be considered as another option. While the resulting transcript would not qualify as that of an oral “deposition” under CCP §2025, it is much easier than a tape recording to use at trial. Some witnesses are intimidated by a request for a written or tape-recorded interview, and may be even more hesitant to speak with a court reporter present. Counsel must weigh the benefit of obtaining a recorded interview against the risk of turning a cooperative, friendly witness into a recalcitrant, antagonistic one.
Unrecorded interviews. A less intimidating way to “lock in” a witness is to have another person present (a corroborator) during the interview. The attorney may conduct the interview in the presence of a “corroborator,” often another attorney or a paralegal at the firm, who could testify about the witness’s statements, if necessary. Many attorneys prefer to have an investigator interview their witnesses, because the investigator can also testify at trial. Because any corroborator or investigator is subject to cross-examination based on bias, neither of these methods is nearly as effective as locking the witness into the statements made at the interview by a signed writing or recording.
When a witness who has been interviewed is subsequently deposed, any communications that witness has had with any party or attorney involved in the case will generally come to light. Any informal contacts between an attorney and a supposedly independent witness can be used by a skillful opponent to imply to the jury either that the witness is not independent, or that the interviewing attorney was trying to influence the witness’s testimony. Having an investigator conduct the interview (rather than counsel), having it recorded, or obtaining a written statement from the witness may diffuse any argument of bias or interference.
An amazing amount of information is available free on the Internet, or for a fee through private databases. For example, attorneys litigating against a publicly held corporation should not overlook that corporation’s SEC 10k and 10q filings, which contain the company’s financial statements, detailed descriptions of its lines of business, future prospects, competition, stock holdings, options, compensation for officers and directors, and other significant information. Those filings may even contain information about the specific case involved.
There may also be a plethora of articles available on the Internet about better-known companies, and a wide range of publications. Gathering public information, such as newspaper articles, technical publications, textbooks, and the like, can also be accomplished the old fashioned way: from the public library. Given the amount of publicly available information, it is sometimes more efficient to retain a research service to gather specific information from both online sources and libraries.
A tremendous amount of information is also available from government agencies. This information, which includes court filings, filings with the SEC, corporate filings with the California Secretary of State or Department of Corporations, and information available from the federal government through the Freedom of Information Act (5 USC §§552–553) or the California government through the Public Records Act (Govt C §§6250–6270), is increasingly available on the Internet, although much of it must be obtained directly from the appropriate agency.
Surveillance is usually used in personal injury cases when there is some question as to the veracity of the plaintiff’s description of his injuries and physical limitations. When it is successful, it can be devastating to the plaintiff’s case. However, it is frequently inconclusive and runs the risk that the jury will find the defendant’s tactics to be extreme. Careful consideration should be given to the timing of the surveillance, and to whether it is likely to succeed in a given case.
For example, if a plaintiff complains of intermittent back pain, it will be difficult to obtain surveillance conclusively establishing that the plaintiff was lying. Even if the surveillance tape shows the plaintiff engaged in strenuous physical activity, the plaintiff will either say he was having a good day that day, or that he was in pain but engaged in the activity because he had to get on with his life and live with the pain. An attorney who is contemplating conducting surveillance of the plaintiff should set up that surveillance with detailed deposition questions so as to maximize the chance of catching the plaintiff in a clear fabrication or gross embellishment.
The timing of surveillance is also important. Although conducting surveillance before the plaintiff’s deposition allows the plaintiff to be cross-examined at the deposition with the results of the surveillance, it is usually preferable to take the deposition first. As discussed above, the deposition will help set up the surveillance. Also, most defense attorneys would prefer to keep the surveillance secret up to the point of trial. One exception to this is if the surveillance tape can be used at the depositions of treating physicians to persuade them that the plaintiff was not being truthful, and that their diagnoses should be changed accordingly.
If an attorney decides to keep the surveillance secret, it should be conducted after discovery closes. For example, the Judicial Counsel form interrogatories contain two questions (13.1 and 13.2) that require the defendant to reveal that surveillance has occurred. However, if it is not conducted until after discovery closes, there may be no way for the plaintiff to learn of the surveillance.
Discovery Stipulations
Agreements among counsel are particularly helpful when the letter of the discovery statutes does not allow for specific discovery to be obtained in the manner and at the time desired by counsel. Two examples of this are expedited depositions and the early exchange of expert witness information.
Stipulation for Expedited Deposition
The expedited deposition is a modification of the one-deposition rule that can be particularly helpful in complex commercial cases. Such cases pose timing problems because there is always an incentive to delay key depositions until all documents have been obtained and reviewed, and all issues and allegations thoroughly investigated. This makes it difficult to evaluate and resolve cases early. Rather than limiting each attorney to one opportunity to depose each witness, the parties can stipulate to expedited depositions, which are scheduled with specific limitations that allow the attorney to obtain basic important information early, without waiving the right to complete the deposition at a later date.
For example, in a typical business dispute case, it may be necessary to obtain and review a large number of documents before complete depositions of the key witnesses can be taken, causing many months’ delay in the evaluation of the case. It may be advantageous for counsel to agree to two-hour or half-day depositions of the key witnesses early in the case, and agree to waive the one-deposition rule for these witnesses. With this type of stipulation in hand, the attorneys are free to take those expedited depositions without the risk that they will be unable to ask the deponents questions after all the documents are obtained and reviewed.
This procedure promotes an early resolution of the case, because the case can often be evaluated after the expedited depositions and can save all parties enormous sums in litigation expenses. If the case does not settle, the depositions may be completed in preparation for trial.
The written stipulation should provide that any party may subsequently depose any of the witnesses again, simply by issuing a deposition notice, without any showing of good cause. This arrangement can make the expedited deposition device worth pursuing in a discovery plan involving many potential deponents or large numbers of documents.
Stipulation for Early Exchange of Expert Witness Information
The early exchange of expert witness information also promotes the early evaluation of a case. Many cases, particularly business litigation, turn on expert testimony. It may be difficult to evaluate a case until the experts have been deposed, which is generally within a few weeks of trial and after an enormous amount of money has already been spent on the case. Most clients are interested in an early evaluation of the case, so that an assessment can be made about whether it should be settled, and at what level. An agreement to allow informal interviews of experts, or an exchange of expert reports or opinions, can be beneficial to all parties in the action. Most counsel, however, want their experts to have flexibility to react to new evidence and revise and refine their opinions as the case develops. This particular problem can often be resolved through an appropriate stipulation that prevents the use of information obtained during an informal exchange at the expert’s depositions or at trial.
Construction litigation provides an example of when stipulations regarding experts can be of crucial importance. Given the number of parties typically involved in such cases, and the technical nature of the claims, often the only practical way to obtain sufficient information with which to evaluate the case is to put all sides’ experts into a room together to exchange opinions. More-over, it is usually necessary for some destructive testing to be performed, such as opening walls or removing windows, to verify hidden conditions. It is common for counsel to stipulate that the experts establish a protocol for that destructive testing, and that they can all be present while it takes place.
When opposing experts meet to exchange information and opinions, the attorneys should stipulate that their discussion will be deemed privileged and cannot be used later against any of the parties. Sometimes, these meetings are enormously helpful in resolving the case, or at least in clarifying the issues so that discovery can be focused and effective.
Discovery stipulations can also be advantageous when two parties want to exchange information without revealing it to a third party. The classic example is when a plaintiff sues two defendants who have indemnity claims between them. As a general rule, if each of the defendants aggressively pursues its indemnity claim through formal discovery, the plaintiff will obtain an enormous benefit. In fact, the plaintiff may be able to sit back and simply allow the two defendants to prove the plaintiff’s claim against each other. Defense counsel frequently agree in such circumstances to exchange information informally. This allows each defense counsel to obtain the information necessary to evaluate and try the case, without providing a windfall to plaintiff’s counsel.
Stipulation To Coordinate Discovery Among Counsel
Even when statutory discovery tools are used, it is usually beneficial to all parties to agree to coordinate discovery efforts. This is particularly true in large, multiparty, and document-intensive cases. If each party serves similar interrogatories on all the other parties, the result is both cumbersome and inefficient. Duplicative and overlapping document requests can result in a mass of paper that will prove difficult to organize and use effectively. It is far preferable to stipulate to a discovery plan among counsel. A stipulated discovery plan can set the scope and order of discovery directed toward each party, minimize discovery disputes over procedural matters, and help counsel keep documents and other discovery organized.
For example, rather than have all six defense counsel serve form interrogatories on plaintiff’s counsel, all parties can agree that one defense counsel will serve them. To avoid dueling deposition notices, counsel may agree to set aside a number of consecutive days for taking several depositions, without delays or interruptions in the discovery process. Counsel should address at the outset whether each deposition will have to be completed before the next one commences. Of course, there may be strategic reasons for not resolving this issue at the outset. One attorney may want to hold one deposition open so that it can be resumed after other depositions are taken. By not resolving this issue, however, that attorney runs the risk that the attorney representing the first deponent will refuse to produce any other witnesses until that first deposition is completed.
In business litigation cases involving numerous documents, the parties should agree that documents being produced by a given party will be Bates-stamped (i.e., having consecutively numbered labels affixed to each page) with letters identifying the producing party. This provides a simple but effective way of keeping those documents organized, particularly when several parties may be producing their own copies of identical documents.
Bates-stamping documents will also help all counsel keep track of what documents they have produced. With a small number of documents this can be accomplished by attaching copies of the documents to all responses to the document demands. With large numbers of documents, it is accomplished more efficiently through Bates-stamping the documents, and then setting forth the Bates numbers of the documents being produced in the responses to the document requests.
This procedure will also make it easier to organize the documents into a database. For example, in construction litigation cases, there may be volumes of letters by homeowners or tenants making specific complaints about their units. Entering this information into a database allows the attorney to search for complaints by unit, owner or tenant, type of complaint, or time frame. Such database entries will enable the attorney to determine what complaints are being made relative to the work of a given subcontractor, and may also assist in making or resisting a statute of limitations defense. If all documents produced have been Bates-stamped with letters identifying the producing party, that information can be added to the database so that counsel will be able to determine what parties possessed what documents.
To track multiple exhibits to be used in a series of depositions, it is helpful to create a master list with one set of exhibit numbers. This avoids having 14 different “Exhibit 1″s to 14 different depositions. If the matter proceeds to trial, all parties will be working with the same set of numbered deposition exhibits.
Even in straightforward, two-party personal injury litigation, stipulations as to the order and timing of discovery can be advantageous. For example, most plaintiffs’ attorneys in a personal injury case will react positively to stipulations enabling the defense attorney to evaluate the case sooner rather than later. While defense counsel can serve Judicial Council form interrogatories on the plaintiff’s attorney and obtain the identity of health care providers in that manner, defense counsel can also pick up the telephone and ask the plaintiff’s attorney to send a list of those providers the next day. This arrangement saves at least a full month compared to the formal interrogatories procedure. Similarly, most plaintiffs’ counsel will agree to waive the 20-day period for notice to consumer for subpenaing of records from medical providers (CCP §2025(f)). It is extraordinarily rare for plaintiff’s counsel to move to quash a subpena seeking medical records relating to the plaintiff during that 20-day period. By obtaining medical records almost two months sooner, the plaintiff’s deposition can be taken and the entire case resolved sooner, to the benefit of both attorneys’ clients.
Depositions of expert witnesses is another area in which coordination among counsel is frequently necessary. Because all experts must be disclosed simultaneously, it is not uncommon for several parties to serve expert witness deposition notices on the same day. Some agreement among counsel will inevitably be required so that the expert depositions can be taken in a logical and efficient manner. Defense counsel usually argue, and plaintiffs’ counsel often concede, that it makes sense to depose plaintiff’s experts first because the defense experts will be responding to and testifying about the opinions of plaintiff’s experts.
Another expert witness stipulation that is frequently helpful concerns the right to disclose supplemental experts. Any party who has exchanged a list of expert witnesses may supplement that list within 20 days of the exchange to add an expert who will express an opinion on a subject covered by an expert designated by an adverse party, as long as the party adding the expert had not previously retained an expert to testify on that subject. CCP §2034(h). An attorney with no disclosed expert in an area in which there is an adverse expert may want to depose that adverse expert before making a supplemental disclosure. To do this without a stipulation, however, that adverse expert’s deposition must be taken within the 20 days timeframe, which is not always possible. Alternatively, counsel can agree that a supplemental expert can be named within two days (or other specified period of time) of the completion of that adverse expert’s deposition.
Although it may be possible to conduct discovery in strict compliance with the Code, using only statutory discovery tools, it is rarely in anyone’s interest to do so. Informal discovery and discovery stipulations provide mechanisms for obtaining and exchanging information and documents more efficiently and more effectively than can be achieved by reliance solely on statutory procedures. Discovery disputes, particularly on procedural matters, can be minimized if not avoided entirely, and the case can be moved forward at a faster pace. Your clients, especially, will appreciate the savings in cost and time that these efforts produce.