Rule 30(b)(6) depositions rest on a legal fiction, taken to a ridiculous extreme, the personhood of a corporation. They are an invitation to create hearsay evidence, and an opportunity to make mistakes that cannot be corrected. Essentially the 30(b)(6) deponent is making official statements for the corporation, whereas most official corporate statements in law and practice are made by corporate officers, generally in writing, to make it clear that this is a corporate statement, not an individual one.
It’s been pointed out in legal advice sources that it may be advisable to designate a 30(b)(6) representative without direct knowledge, because the opposing attorney may fish with questions not on the list of issues, or seeking unspecified detail that might not be included in a briefing. I really can’t see why these depositions are even allowed, compared to interrogatories, which also create legally binding testimony. Corporations act through board approval or authorization, which is, in theory, deliberated. It is in that process that a corporation becomes a person.
The reason for depositions rather than interrogatories is so that a jury could, if necessary, view the witness to judge probity, (affect matters), but this is very strange in a 30(b)(6) deposition, where it could be very common that a witness will decline to answer, which, then, to some, may look evasive, or “slimy,” as as IH Fanboy called some answers — which seem proper to me in context — on LENR Forum.
It appears that the Rossi questions and conduct in the depositions was designed to solicit that kind of response, then to attack the corporation based on lack of response to questions that have already been answered by someone with much more direct knowledge, on the basis of failure to prepare. We discuss.
An initial extensive list of questions was directed to six deponents, December 14, 2016, see Exhibit 1. The deponents named were Darden, Mazzarino, Murray, personally plus 30(b)(6) representatives of Industrial Heat, IPH, and Cherokee Investment Partners (CIP).
This scheduled the Mazzarino and Cherokee depositions for December 28 and 29, in Raleigh. Mazzarino is an officer of Cherokee.
It is not specified in this request which questions are for which deponents. This was, then, a setup for “failure to prepare.” To prepare to answer all the listed questions would require massive work, and most questions, for CIP and IPH, would be, as far as I’ve seen from evidence visible in the case, irrelevant. The company wouldn’t know. IPH is a possible exception, and it is the IPH deposition that the Motion for Sanctions most strongly focuses on.
IPH could appear to be an exception because it is actually a plaintiff in the cross-complaint. However, IPH is largely a legal fiction, purely a device for holding intellectual property. As far as we know, it has no employees, and, as a wholly-owned subsidiary of IH, is entirely dependent on IH for funding and decision-making. Darden and/or Vaughn would have the best personal knowledge, there is no doubt, but both of them had already been deposed before the IPH deposition.
The Mazzarino deposition took place when? It is unclear to me. It appears that the Cherokee 30(b)(6) deposition for Cherokee did not take place as scheduled, but was scheduled, per the Amended notice, later, on February 15, after the Vaughn deposition on representing IH, February 13.
Mazzarino filed an Affidavit, February regarding the founding of IH, “for purposes of entering into the Licence Agreement with Rossi.” Because CIP and CA (Cherokee Advisors) employee time had been used at various occasions, and in 2015, after the financial restructuring resulting from the Woodford Investment and the founding of IHHI, IH began reimbursing CIP and CA for that time.
Cherokee objected to the deposition notice, February 9, 2017, with Exhibit 2.
Plaintiffs have noticed separate Rule 30(b)(6) depositions of defendants Cherokee Investment Partners LLC (“Cherokee”), Industrial Heat LLC (“IH”) and IPH International B.V. (“IPH”). Cherokee disclaims any obligation to prepare a Cherokee witness to testify as to topics that are unreasonably cumulative or duplicative of discovery sought from IH and IPH, or topics
as to which discovery can be obtained from IH and IPH in a manner that is more convenient, less burdensome or less expensive than obtaining that discovery from Cherokee. Cherokee specifically disclaims any obligation to prepare a witness to testify with respect to documents maintained and produced from the files of IH or IPH with respect to topics as to which IH and
IPH have also been noticed.
Cherokee addressed each question, with a general answer being
Subject to the general objections, Cherokee will prepare a witness to testify with respect to any knowledge of Cherokee employees or principals, obtained while acting in their capacity as such, of [this issue].
It is the general claim of Cherokee (and IH), that Darden and Vaughn were not acting as Cherokee “employees or principals,” though there is an admission that there was discussion of the corporate form to be used for what became IH. (Deposition on behalf of CIP by Fogelman, as excerpted, p. 137, line 7)
A. My discussions of this investment with Tom Darden, and as I mentioned earlier, going through the use of the name Cherokee, it was clear to me that there was a discussion of whether or not to use the name Cherokee in a to-be-formed entity. The clear inference there is there was a to-be-formed entity that may or may not reference your question. But that’s what I can think of in terms of what I know about the discussion with Dr. Rossi about an
entity to be used for his investment.
Q. Did you attend the closing on the investment into Dr. Rossi’s technology?
Q. Do you have any knowledge as to what representations were or were not made at closing?
A. No. Other than what’s — what would be in the agreements.
Fogelman would certainly have known about an major investment by Cherokee in the Rossi technology. This was not simply a coached witness with no personal knowledge. However, he would not know the intimate business of Industrial Heat as an employee or contractor for Cherokee. IH took a risk by using him as a representative, as can be seen by the above (which is basically harmless but which could be slanted and presented differently than what was actually said. He did not, there, testify about the “discussion” and this may all be later information given to him. If it is true that Cherokee money was not invested in IH, this was all irrelevant to Cherokee. Fogelman does answer questions where he’d have personal knowledge — and other questions he answers based on his briefing, which, given the IH position, I’d imagine would be short and not deep.
This is all a mess created by Rossi’s attempt to set aside the “entire agreement” clause. Its expense created by the Judge’s decision to ignore that pending discovery. “Entire agreement” clauses are designed to avoid this kind of scattershot complaint. It seems the Judge decided that there was a snowball’s chance in Hell of Rossi prevailing, if he could find a smoking gun indicating willful fraud and a series of other necessary conditions. He’s not finding that gun, and he’s pissed!
Slocum Hatch Fogelman was deposed on behalf of both Cherokee and IH. In his answers to questions, he appears to be speaking, on occasion, from personal knowledge. Fogleman is the CFO of Cherokee. This is not some random bozo, as Rossi’s motion implies. So why does the Motion include Cherokee?
Because they can.
It is only when questions are asked about details of the Rossi Agreement, the Rossi technology, and what followed, that Fogelman defers to the knowledge of Darden and Vaughn. Because this was an IH project, a personal investment, apparently, by Darden and Mazarrino, not on behalf of Cherokee, and deliberately and clearly intended to be separate, it would not be part of Fogelman’s job to know anything about it. But there were initial discussions.
Again and again Chaiken asks leading questions, implying that Fogelman is lying. Again and again, Fogelman sticks to the fact: no knowledge of that, other than what is in the pleadings. This is totally consistent with the pleadings with regard to Cherokee. Chaiken asks Fogelman about an email to Darden and Vaughn from Daniel Pike, which contained some obvious errors (from the rest of the evidence). Asked if it was correct, Fogelman says “No, not to my knowledge.” The email had been cc’d to Rossi, who provided it. It was not a representation by Darden or IH, as such. And this is all being presented as evidence that Fogelman was not prepared.
How would Fogelman know that the information was not correct? It’s obvious: As the CFO of Cherokee, he would know if “Cherokee owned the E-cat intellectual property.” They did not. IH did, and then it was assigned, per the Agreement and Amendment, to IPH. Cherokee was not involved.
This went on for almost eight hours. The basic questions could have been addressed in a few minutes.
How would the COP of the Rossi devices be a matter known to the Cherokee CFO? Only if Cherokee was the actual owner of IH (which Rossi apparently believed, or claims to believe, and he’d have thought, seeing the email from Pike, “Of course.”)
IPH also objected to the notice, the same as Cherokee, and then:
Subject to the general objections, IPH will prepare a witness to testify with
respect to IPH’s knowledge, if any, of contract negotiations between any plaintiffs or third-party defendants, on the one hand, and any defendants in this lawsuit, on the other hand.
What I’d expect is that IPH would have zero knowledge, that IPH entirely depended on Darden and Industrial Heat. The company has no “operations,” it is a wholly-owned subsidiary of IH,
Given the objections, Rossi was on notice that these 30(b)(6) representatives might not have further information, and would simply say that “we don’t have that information, Industrial Heat does.”
So, then, the actual IPH deposition has lots of “no knowledge” answers, because Chaiken takes the answer to his question as literal and absolute:
Q. Okay. Is there any topic on this list that you are not prepared to testify about to?
Q. So you are prepared to testify about all the topics listed on Pages A-4 and A-5?
A. Is that the same question?
Rossi then leaves out 5 pages that may have clarified this.
[…] Heat, LLC, has.
BY MR. CHAIKEN:
Q. Okay. But I’m not talking to Industrial Heat today, I am talking to IPH. So I am asking what — what information you have independent of that.
MR. LOMAX: Objection to the form of the question.
THE WITNESS: I don’t have information independent of the information that Industrial Heat, LLC has.
BY MR. CHAIKEN:
Q. Okay. I am trying to understand what information Industrial Heat has now since you are relying upon it. So what information does Industrial Heat have to support that allegation?
MR. LOMAX: Objection to the form of the question.
THE WITNESS: I think that is the same question you asked before.
BY MR. CHAIKEN:
A. And I would refer you to the testimony from Industrial Heat, LLC.
Q. Okay. But you don’t know what that testimony is?
A. I don’t.
Q. Okay. What information does IPH have to support the allegation that in paragraph 51, “Rossi’s statement was false that Italian law would not allow the 24-hour validation process as set forth in the license agreement without first obtaining a permit that would require at least six months to obtain”?
A. Okay. I think this is the same question you have just asked.
Q. No, actually I am talking about a different allegation.
A. Please repeat the question.
Q. Sure. Well, I just read directly from paragraph 51 of your complaint, excuse me, from your counterclaim where you allege that Rossi’s statement was false in paragraph 51. What proof did IPH have that Rossi’s statement was false?
MR. LOMAX: What is the difference between this question and the last question?
MR. CHAIKEN: The question was — the last part was Rossi had no such meeting with the Ferrara health office and I asked what —
MR. LOMAX: Okay. Asking about a different fact.
Paragraph 51 is part of the “factual background.” There is no requirement that every party be informed about every alleged fact; it is clear that IH was handling all matters for IPH, being sole owner of it. The 30(b)(6) deposition was a nearly-useless fishing expedition, only a few questions were actually appropriate for an “IPH” answer. The question asked here was not. This was all about negotiations between IH and Rossi, and then I would assume that the question was asked of Darden or Vaughn, who would in any case be the source of information that IPH would then pass on.
Paragraph 51 was stated “on information and belief.” There is no requirement for “proof.” What was proper to ask about would be evidence, not proof. But this linguistic sloppiness may be common.
The matter of the Ferrara test is not clearly covered in the list of issues to be addressed; further, while it might be considered subsumed in one of the very general issues (which one?) that one list of questions was provided to a series of deponents created a lack of clarity about how each deponent should be prepared. As well, questions asked about “knowledge,” and if the “company” had no knowledge — and IPH would not normally have this knowledge, even if their attorneys did in preparing the counterclaims — “no knowledge” would be the answer on the issue. To interpret the 30(b)(6) rules as requiring that the company become informed on everything, duplicating what would be provided in the individual depositions, seems extreme to me.
Rossi counsel cites QBE Ins. Corp. v. Jorda Enters., 277 F.R.D. 676, 689 (S.D. Fla. 2012).
First of all, what happens here? Suppose the court does decide that Cherokee and IPH failed to properly instruct Fogelman. There are two consequences, per QBE. Depending on circumstances, one or both might apply. One is that Rossi attorney expenses for an allegedly useless deposition might be awarded. The other is that Cherokee and IPH would be prohibited from introducing at trial any claims that were the subject of the issues not properly addressed.
And the result of that? This would have little or no effect on the counterclaims, only on those where IPH was the sole counter-plaintiff, which is COUNT II: BREACH OF CONTRACT (Various Provisions in the License Agreement) (IPH against Leonardo and Rossi) , a series of largely meaningless claims, minor violations. Industrial Heat would not be affected by this.
Rossi was asking about things that were not Cherokee or IPH business, except as IPH was a counter-plaintiff. (Cherokee is not a counter-plaintiff.)
When Judge Altonaga did not dismiss the complaint as to Cherokee, she relied upon this, my emphasis and links added:
On October 26, 2012, Rossi arrived at Cherokee’s office to execute a License Agreement (“License Agreement”) [ECF No. 1-2]. (See id.). At this time, Darden and Vaughn told Rossi they had formed a new business entity, Defendant, Industrial Heat, LLC (“IH”), a branch of Cherokee designed to serve as the holding company for the E-Cat license. (See id. ¶ 41).3 Darden and Vaughn represented to Rossi that Cherokee entirely owned and funded IH. (See id. ¶ 43).
Whether they said it or not, this appears to be entirely incorrect. It is conceivable from the evidence we have that a Cherokee entity may have been considered, but would have been immediately rejected as outside of the business area of Cherokee; rather, this was a personal project of Darden and Mazzarino, plus Vaughn, and Cherokee — these were key employees, founders of Cherokee — and thus supported in a minimal way, as by providing meeting space, a mail drop, etc.
Fogelman emphatically denies that Cherokee would have invested in this way.
Q. Did they — did Cherokee Investment Partners
ever pay any money to Industrial Heat, LLC, to your
A. Pay money to Industrial Heat?
Q. Invest in, give money to?
A. Not to my recollection.
Q. Okay. Now, allegation 38, paragraph 38 of the
complaint says: “At each of the aforementioned meetings
Darden, Vaughn and Cherokee repeatedly stated that
Cherokee has billions of dollars at its disposal and is
willing to pay Rossi and Leonardo to license the E-Cat
What evidence do you have that those statements
were not made by Mr. Darden, Mr. Vaughn and Cherokee?
A. Other than they are just beyond any imagination I have.
Q. I didn’t ask about your imagination, sir; I asked about evidence. Court cases are tried on evidence.
And I would like to know what evidence you have and that you intend to present to support your denial of that allegation.
A. I’m not aware of evidence.
What evidence do you have that Darden is not the reincarnation of Josef Stalin?
Q. Okay. Paragraph 39 of the complaint alleges that: “Moreover, at these meetings Darden, Vaughn and Cherokee fraudulently represented that, A, if Cherokee were granted a license to the E-Cat IP, they would protect the E-Cat IP from dissemination, so as to maximize value of the intellectual property around the world.”
What evidence do you have that Darden, Vaughn and Cherokee did not make that representation, if any?
A. I don’t have any evidence that they made the representation or that they did not make the representation.
Q. Is there someone at your company that would have more knowledge or more information regarding this fact?
A. Not that I know of.
I notice that this isn’t exactly correct. There would be Darden, in particular, but also Vaughn. However, the intention of the question would be “anyone else other than them.” From the context, there would not appear to be any other witnesses to the fact, but Rossi, Darden, and Vaughn, and proving a negative can be impossible. “Rossi: when they said that, so-and-so had excused himself momentarily.”
Q. Have you asked anyone about this prior to your
A. I think I recall, I’m not sure I recall exactly, but this seems like, by my recollection, one of the topics we discussed in a meeting.
Oddly, Chaiken does not then ask what was said at the meeting. “Heh, he, we fooled him!!!”? Most likely, Darden and/or Vaugh denied the claim, but they might have provided some details about what they did say. Fogelman does not say that he remembers nothing about it.
Q. But sitting here today, you have no facts or evidence to support your denial that Cherokee represented — I’m sorry, Darden, Vaughn and Cherokee represented that if Cherokee were granted the license to the E-Cat IP, they would protect the E-Cat IP from dissemination to as to maximize the value of the intellectual property around the world?
There is an issue here of the interpretation of “facts or evidence.” Fogelman does present evidence — his own knowledge and understanding of Cherokee practices and of Darden and Vaughn personally. But he believes that Chaiken is seeking something more definite, like a recording of the meeting, or an independent witness, which apparently does not exist. That would be the legal point of this, to find out if there is other evidence on the matter.
Q. No evidence?
Now, do you have any facts or evidence to support your claim — your denial of the claim that Darden, Vaughn and Cherokee fraudulently represented that they were authorized to use the funds managed by Cherokee to pay Leonardo in excess of $100 million for the E-Cat IP license?
Sir, do you have any facts or evidence to support your denial of that allegation?
The claim would be made in information and belief, and knowledge of Cherokee practices, and Fogelman attempts to state that:
A. The — so funds managed by Cherokee Investment Partners, LLC would refer to the private equity funds which were not permitted to make this investment. So…
Q. That is not the question, sir. The question is, do you have any facts or evidence to support your denial —
A. That would be — the limited partnership agreement would be what I would reference there too. That it says funds managed by Cherokee Investment Partners, LLC. That would refer, in my mind, to the private equity
Q. Okay. I am not asking whether the funds could do that. What I am asking is, do you have any facts or evidence to support your denial of the allegation that Darden, Vaughn and/or Cherokee fraudulently represented that they were authorized to use the funds managed by Cherokee to pay Leonardo in excess of $100 million for the E-Cat IP license?
A. Other than the testimony of Mr. Darden and Vaughn, no.
He could have said more. “Other than that testimony, my knowledge of Darden and Vaughn, with a long history, and Cherokee practices and agreements.” As to “independent evidence,” no. There would not be any, if these meetings happened as we have seen described. Yet, Cherokee is being held accountable for alleged representations that Cherokee never signed on to, for an Agreement that Cherokee did not sign and that explicitly had an “entire agreement” clause to avoid claims like this coming up, and in addition running into the Statute of Frauds, which prohibits binding agreements based on oral representations, to be performed more than a year in the future.
Q. What has Mr. Darden testified to?
A. I don’t know that.
Q. What has Mr. Vaughn testified to?
A. I don’t know that.
Q. So you don’t know whether there is anything in their testimony that would serve as evidence to support your denial?
A. I don’t know their testimony.
Q. Okay. Sitting here today, sir, as the corporate representative of Cherokee Investment Partners, you have filed a legal pleading in which you deny that
allegation. Now, in doing so, you represent to the Court that there is a basis for that. Do you have a factual or evidentiary basis to deny that allegation at this point in time?
MR. LOMAX: Objection.
The transcript is interrupted here. Lomax objected to the “form.” However, Cherokee, as such, did not file such a pleading, but participated in a pleading filed by all the defendants, and it is enough that one of them has the required evidence, which would be, in this case, their testimony, and in addition the illegality of what was being claimed (i.e., Cherokee simply does not do this kind of business, and it is just as likely, if not more likely, that Rossi’s memory of what he was told was defective. Rossi is well-known for warping facts toward what he wants, plus … he lies.
This is useless. It is clear that the testimony will be allowed, and Fogelman referred to that, simply assuming that the evidence would be there. The Rossi goal would be to prevent the introduction of other evidence by Cherokee, but Darden and Vaughn could introduce it, if it exists.
This all gets really clear:
Q. Okay. Let me put it this way. Sir, do you deny that in reliance upon the representations above, Dr. Rossi and Leonardo, with the assistance of their Italian attorney, negotiated the terms of the license agreement with Cherokee?
A. Yes. With a license agreement with Cherokee Investment Partners, LLC, yes. That was never the intention.
Q. What facts or evidence do you have?
A. Cherokee Investment Partners, LLC would never make that investment.
Q. I understand what you are saying. But I am asking for facts and evidence, not your assertion that they would never make that.
A. This is my testimony.
If Cherokee, as such, participated in the negotiations, Fogelman, as CFO, would likely know it. But if they did not, he would know nothing, other than what Darden and Vaughn might have told him. He knows that Cherokee did not invest in Industrial Heat. So he knows that regardless of whatever Darden and Vaughn told Rossi, before or during the signing of the agreement, Cherokee was not a part of it. So then the legal question would be if Rossi performed due diligence to verify that Darden and Vaughn actually were representing Cherokee, while, in fact, he had in front of him a contradictory agreement, which he signed and did not withdraw from in spite of at least a years’ opportunity. No lawyer would have told him to rely on “Cherokee” without an official Cherokee signature. This appears to be open and shut, if it is raised in Summary Judgment.
For other reasons, Fogelman trusts his people, Darden and Vaughn. And clearly he has no contrary evidence. If he did have knowledge of evidence, he’d be up for perjury, or, if he should have known and did not find out, Cherokee might be prevented from presenting it at trial.
30(b)(6) depositions look like a mine field. See The Corporate Representative’s Deposition Bill Of Rights (And Wrongs)
If you don’t properly prepare for the deposition, your company can be sanctioned with a fine, a ruling that its witnesses won’t be allowed to testify at trial, or even with stricken pleadings. Reilly v. Natwest Mkts. Grp., Inc., 181 F.3d 253, 269 (2d Cir. 1999).
On the other hand, you’re not required to be perfect. Your company won’t be sanctioned just because you can’t answer every question on a certain topic. Elan Microelectronics Corp. v. Pixcir Microelectronics Co. Ltd., 2:10-CV-00014-GMN, 2013 WL 4101811 at *8 (D. Nev. Aug. 13, 2013).
If it turns out that you don’t have all the details on a particular topic, the company will have to follow up by producing another witness. Marker v. Union Fidelity Life Ins. Co., 125 F.R.D. 121, 127 (M.D.N.C. 1989).
Courts recognize that these depositions are not “a memory contest or an opportunity to require a witness to do detailed mathematical calculations on the spot,” but they do require the company to make a good faith conscientious effort to properly prepare its witness. Elan Microelectronics Corp. v. Pixcir Microelectronics Co. Ltd., 2:10-CV-00014-GMN, 2013 WL 4101811 at *5 (D. Nev. Aug. 13, 2013).
That said, if the witness’s knowledge is limited for some reason, the company should notify its opponent of that fact before the deposition begins. Calzaturficio S.C.A.R.P.A. s.p.a. v. Fabiano Shoe Co., Inc., 201 F.R.D. 33, 38 (D. Mass. 2001).
Sanctions at this point seem premature, other remedies would address any possible “missings.” In this case, it appears to me that the “issues” may have lacked the particularity required to allow a claim for sanctions. The written objections raised the problem, and this was never resolved, Rossi seeming to think that it was enough that he presented an argument.
The circumstances in QBE were quite different. QBE, the insurance company, failed to provide the information, actually because it was unable to do so, because it was suing under subrogation and the client, in the end, refused to cooperate (and then it could sue the client for recovery of the insurance proceeds). It appears to have failed to timely object. It was unable to provide a substitute witness, even though it intended to do so, apparently. So a subrogation case failed because of lack of cooperation of the client, and it actually would fail and this is a totally fair outcome.
This knee-jerk, hair-trigger filing of a Motion for Sanctions, like all of the similar Rossi motions, seems premature at best.
On LENR Forum:
[some detailed commentary, generally sound, but I have some corrections or comments, so this is just a few excerpts]
These sanctions involve a rule on discovery (Rule 30(b)(6)) that I’ve never heard of before now,
Me neither. However, I did read up on it and link to some sources.
But it’s also important in this case to note that although IH is a corporation, this motion does not allege any Rule 30(b)(6) violation by IH regarding [its] deposition.
Right. It only alleges violation by Cherokee and IPH.
Rossi’s lawyers allege that the person deposed (Slocum Fogelman, an ‘agent’) who represented both IPH and Cherokee was not adequately prepared to answer questions on behalf of these corporations. Rossi’s lawyers allege that this lack of preparation harms them because they are not able to get adequate information IPH and Cherokee.
First of all, Fogelman is not just some ordinary “agent,” he is CFO of Cherokee and possibly the best person in Cherokee to answer questions that actually involve Cherokee business. As IPH had nobody available — other than Daren and Mazarrino who may be principals and already deposed — IPH — effectively Darden, I think — simply asked Fogelman to cover this, and presumably briefed him. There were practically no questions that IPH would have any information about other than that provided by Darden and Vaughn. However, Rossi asked detailed questions about case details that IPH would not necessarily know. As IPH is a plaintiff, this is a bit more serious, but … the source for the information would be …. Darden and Vaughn, and they were already deposed, and apparently satisfactorily so. (Vaughn deposed for IH). Darden and Vaughn were also personally deposed. So it was twice for each of them. Apparently Rossi would have wanted Darden to be deposed again, but enough was enough.
Rossi does not allege actual harm, only some vague potential harm. And this would be remediable by requesting additional deposition. The dispute over these depositions, obviously not resolved before they were taken, should have been presented to the Magistrate. However 30(b)(6) depositions may not be rejected; nevertheless, the issue was scope and detail, and Rossi’s questions were not specified well enough to allow preparation in a reasonable time to the depth that Rossi wanted, which was probably too deep, I doubt the Magistrate would have supported it. IPH was not required to know every detail of the pleadings and all the evidence behind it, and if they knew that any relevant facts were already available to Rossi for deposition, they were not, my opinion, under an obligation to separately determine what would be public record. The Rossi interpretation (“no matter how burdensome”) is preposterous. That only applies where the deposition is necessary.
First, unlike the previous Rossi Motion for Sanctions for witness tampering, this filing seems to likely to be initiated by Rossi’s lawyers rather than Rossi.
Yes, though the word “slime” still arises unbidden in my mind. The depositions went on far too long for the depth of what would legitimately be discovered from Cherokee and IPH. Fogelman was very, very clear about Cherokee, so the sanctions claim there makes no sense at all, but as to IPH, I’m not so sure. Overall, my sense is that the testimony was adequate. Essentially, IPH had almost no information, so Fogelman had almost no information, and since other witnesses were available, what is necessary is the testimony of the collection of witness, not each one.
I’m guessing that in the case of IPH and Cherokee, Darden’s lawyers did strategically recommend to name Fogelman as an agent for IPH and Cherokee and decided to have Darden prepare him in as minimal way possible as to comply with the law while minimizing risk.
The Cherokee and IPH cases are different. It appears to me that Fogelman was testifying for Cherokee from personal experience, as the CFO, not merely as a prepared and instructed agent. Every deposition is a risk, and 30(b)(6) depositions are particularly risky. One slip of the tongue…. One page I read advised considering not using a knowledgeable employee, because they might be asked questions outside the scope of the specific issues to be discussed, and we can see that this was being done. If they answer — maybe as some kind of guess — the corporation can be nailed to those comments. With an instructed representative, they can be briefed on what is covered in the issues, and then the Objections filed by Cherokee and IPH are important. Rossi was put on notice that they might decline to answer as they did, so he is not quite the innocent victim. I’d think that before going to the major expense of an eight-hour deposition, (two or three attorneys or even more), that issue would have been resolved. Up against the deadline, this would be a great reason to ask for more time. They have been getting Magistrate rulings quickly.
My opinion is that unlike previous Motions to Sanction, Rossi’s lawyer’s Motion actually seems reasonable: How can IPH offer affirmative defenses, countersue Rossi, and make computations of damages against Rossi and then claim (via agent Fogelman) that they don’t know anything about those things other than what IH has stated?
I went back and forth on this as I studied it. Now confining the issue to IPH, my own opinion is that if there are multiple parties, jointly filing, it is enough if one of them has, or claims to have, evidence. In this case, one defendant and counterplaintiff has signed on to a pleading, based on alleged facts in the common statement of history. It is not necessary that each plaintiff aver each fact. It is not necessary that each plaintiff be informed about details; they may simply trust the others and allow joint representation. Rather, this is the crucial issue in what may tend to have the greatest impact: if a party withholds or does not provide crucial evidence, they may not then, later, at trial, introduce it. “We have no knowledge” and “Here is the proof” are incompatible. However, if they state that the evidence is the testimony of So-and-So, and So-and-so is available for deposition, that is compatible and adequate.
I don’t think there is actually anything missing from the Cherokee/IPH testimony, and if there is, it is relatively minor and easily remedied. Cherokee and IPH were not obligated to have the knowledge that Rossi was demanding. This is most clear with Cherokee, and only gets confusing with IPH, because of IPH being a plaintiff for one count. However, again, a company may provide multiple witnesses, if one is not enough.
The substance here is that Rossi is wasting time and money, fishing for what is very unlikely to exist. If Darden and Vaughn told Rossi that Cherokee would guarantee the payments, they were lying, but I strongly suspect that if they said anything like that, it was in a different form and then interpreted through Rossi Glasses. The relationship between Darden and Cherokee was such as to generate legitimate confidence that they could raise $100 million if needed. As we have seen, that was true. Key, though, was it needed?
One more point: the Objections (from Cherokee and IPH) were not filed in the court, as far as I know. These were objections filed with the requesting attorney. Those only end up in court if placed there, typically by the requesting attorney seeking to compel response. My understanding is that a respondent may object to questions and is not required to respond unless the objection is overruled. So … I agree that this was premature, not following due process.
It’s slimy. Darden is doing everything he can to avoid answering questions. He is the one that knows the details of what happened. And he is the one that should have appeared. Anybody here who is interested in knowing the truth, and less interested in who wins the case, should be at the very least disappointed in IH’s behavior.
First of all, yes, Darden is generally the one who knows the most details. But they have already deposed Mazzarino, Darden, and Murray. Remember that this is all in addition to interrogatories, which also provide answers under oath, and which may include multiple rounds. Vaughn, in addition to required interrogatories, was deposed as the representative of Industrial Heat. The only questions where some confirmation might be needed would be from Cherokee, and Fogelman is the Chief Financial Officer of Cherokee, and in an excellent position to testify on certain questions — the only ones, in fact, that matter. No, Cherokee did not invest in Industrial Heat and does not own it. And wouldn’t. Period. Nohow, no way, ixnay, go away!
IPH is simply a holding company. Given what would be known to IPH, as a company, using Fogelman was as good as anyone else, other than perhaps the single officer, who is not in the United States. The questions that Rossi wanted to ask Fogelman about IPH, where Fogelman deferred to the testimony of Darden and Vaughn, were either not specified on the list, or were better answered by another witness, Darden and/or Vaughn, who had already been deposed and were presumably answered. All that an IPH representative would have done is to ask them for details, but details about what. The Rossi notice did not specify what was to be covered with each deponent, was therefore the requirement that all be prepared to testify on all matters? This would be a propesterous interpretation of the 30(b)(6) requirements.
In the case cited where sanctions were applied, there was no other provided witness, and the general rules are designed to avoid a deflection merry-go-round. That did not happen. All roads led to Darden and Vaughn.
Different questions were asked to the different entities. So Rossi’s lawyers were entitled to get answers to their different questions. Instead, Fogelman deflected, denied knowledge of, or passed the buck back to IH. And in some cases, IH passed the buck to IPH.
I have seen no example of IH deflecting any question to IPH. This seems to be an IHFB imagination, i.e., the story of refusing to answer. It’s quite clear that Fogelman was prepared to answer certain questions from the list, sometimes to say “no knowledge.” While one might interpret the rules to require Fogelman to have researched all these things, that is an overly narrow interpretation of the rules. If a witness cannot answer all the questions, another representative who can is to be supplied; however, this assumes that the questions are necessary. Rossi was asking about litigation details that Fogelman (i.e., IPH) was not required to know, in spite of the Rossi argument about Count II.
It’s sort of like when I call my insurance company and question them about a bill, they say that is the provider’s fault, go talk to them. So I call up the provider and they say, that is the insurance company’s fault, go talk to them. Convenient for them. While I get shafted on my bill.
Because he thinks about business like he thinks about Rossi.
We have lots of evidence that IPH passes the buck to IH. We have some evidence (not nearly as much) that IH passes the buck to IPH (See Exhibit 6).
Typical: where in Exhibit 6 is not stated. However, it is probably PDF page 4. This is not “buck passing” to “IPH.” The question is actually referred to “Jim Fogleman,” who is being deposed the next day. It was a question specifically about how IPH handled bills, and it looks like Fogleman (“Jim” is his nickname) handled accounting for IH and IPH. In other words, the idea that Fogleman was clueless was really crazy. The problem was questions that had nothing to do with “IPH” knowledge aside from what Darden et al would know. So this example shows that questions were being directed to where the knowledge would be.
I am now convinced that the Rossi Motion for Sanctions is completely erroneous, and Fogleman was someone with actual knowledge of at least some IPH matters, this was not some clueless representative. It is merely that he did not deal with the issues that Darden and Vaughn were dealing with. Darden was to be deposed on February 16, after all the others. So they get their opportunity to learn about all of it, and have not, in fact, complained about the Darden deposition nor are they asking for sanctions against IH or Darden or Vaughn, personally.
At some point will Rossi or his attorneys be subject to sanctions for filing frivolous motions?
Judge Altonaga swiftly despatched the Rossi Motion for Sanctions for Failure to Comply with Rule 30(b)(6), with her Order, 180.0_Order_denying_179. This was obvious. This video deposition issue is a discovery dispute, to be submitted to the Magistrate. Motions like this, then, in Altonaga’s court, are out of order, and may only be presented on the instruction of the Magistrate. At the same time, not apparently as a response, IH filed a Notice of Hearing before the Magistrate, raising an 30(b)(6) issue of failure to instruct the corporate representative for JM Products, Inc. While we cannot be sure of every detail, IH is apparently doing it right.
That notice also covers
(1) Third Party Defendant J.M. Products, Inc.’s (“JMP”) production of its bank records;
They are still arguing or dragging their feet over that?
(2) JMP’s production of documents pertaining to any agreements or payments made between JMP and Platinum American Trust (“Platinum”) and Franciso De Giovanni;
Secret Word, the Duck comes down with a large check held in his beak. For some distraction, how about Groucho Marx? It has nothing to do with our topic today. Or does it?
For those who don’t recognize the name, the Platinum American Trust has been represented by the JMP attorneys as the owner of JM Products, the supposedly independent customer which appears to have been operationally supported by Rossi, which the bank account would show, presumably. Or not. Francesco Di Giovanni is the beneficiary of the Trust, so I presume that this is what they mean. But maybe Johnson, when questioned, said, “I don’t know anyone by that name,” hence the 30(b)(6) issue.
Johnson is the sole trustee of the trust, which effectively gave him defacto operational control of the trust, as much as an owner, so his claim not to be an owner was at least misleading. Nice trick, though.