Court of Appeal Reverses Trial Court Decision Based on Credibility of Corporate Representative’s Declaration
California’s Second District Court of Appeal recently reversed a trial court’s decision granting the defendant’s motion for summary in judgment in a personal injury case alleging asbestos exposure, based on the credibility of a corporate representative with limited personal knowledge of the case. (In re LAOSD Asbestos Cases (Ramirez v. Avon Products Inc.) 2023 WL 354915, — Cal.Rptr.3d—(2023).)
Plaintiffs Alicia and Fermin Ramirez filed a personal injury complaint in Los Angeles Superior Court against multiple entities alleging Alicia Ramirez developed mesothelioma as a result of exposure to asbestos from various sources, including contaminated talcum powder from Avon Products, Inc. (“Avon.”) used by Alicia and her daughter from the mid-1970’s to 2007.
Avon brought a motion for summary judgment on the grounds that plaintiffs could not prove Avon’s products contained asbestos. The motion relied on the declaration of Avon’s designated person most knowledgeable, stating Avon never used asbestos in its products, required suppliers to provide asbestos-free talc and had internal programs to ensure the talc was asbestos-free.
The trial court granted Avon’s motion for summary judgment finding the affirmative evidence in Avon’s person most knowledgeable declaration shifted the burden and that plaintiffs’ evidence did not create a triable issue regarding the asbestos content or asbestos exposure from Avon products.
However, the Court of Appeal found the trial court abused its discretion by relying on the declaration of Avon’s person most knowledgeable and ruled the declaration and documents were inadmissible based on lack of foundation, lack of personal knowledge and hearsay. The Court reversed the trial court order granting summary judgment, holding that a defendant’s designated corporate representative produced for deposition and in supporting affidavits required the personal knowledge of a non-expert witness pursuant to the rules of evidence.
The Court explained there was no special category for a corporate representative witness in the Evidence Code, only expert and lay witness. As a lay witness who did not start working for Avon until 1994, halfway through the alleged exposure period, the Court ruled that Avon’s corporate representative is limited to matters of personal knowledge, unlike an expert witness who can opine on hearsay and not necessarily based on personal knowledge
For support, the appellate court reasoned that “Person most qualified” is a term defined in California Code of Civil Procedure section 2025.230 pertaining to depositions of entities as a part of discovery and therefore, not limited to admissible evidence. The primary purpose of California Code of Civil Procedure section 2025.230 is not to aid the party whose witness is being deposed but to aid the opposing party. The Court also noted the deposition may be used against any party who was present or represented at the deposition “so far as admissible under the rules of evidence applied as though the deponent were then present and testifying as a witness.” (Code Civ. Proc. § 2025.620.) [Emphasis in original.]
Also, if the subject matter of the questioning is clearly stated during the deposition, the burden is on the entity to produce the right witness and if the designated witness lacks personal knowledge regarding the information sought, the witness “is supposed to find out from those who do.” (Maldonado v. Superior Court (2002) 94 Cal.App.4th 1390, 1395-1396.)
Of note, the majority of the Court’s focus in its decision was on the reliance by Avon’s corporate representative on the documents attached to the representative’s declaration, discussing the issues with the documents in detail. The Court ruled all the documents relied on by the corporate witness were hearsay and “double hearsay” in that the documents also contained hearsay statements made by someone other than the author.
As for Avon corporate documents, the appellate court held the records did not satisfy the business records exception for hearsay. These included memorandums described by the Court as summarizing telephone conversations with no information they were prepared in the ordinary course of business and several documents were not prepared near the time of the events described.
The Court also found that the Avon documents did not demonstrate that Avon’s products never contained asbestos, covering only a limited period, not the 50-year period of alleged exposure claimed by plaintiff Alicia Ramirez. The Court focused in detail on a 1992 unsigned, unsworn document in a “press-release form” from an Avon employee with no details regarding the employee’s role, the basis of the statements or relevant time period for support that no contaminated talc was used in Avon’s products. While the appellate court held that the trial court abused its discretion in admitting all the hearsay documents, it found the abuse of discretion regarding the 1992 statement “particularly egregious.”
In considering Avon’s argument that a corporate witness lacking personal knowledge could testify regarding underlying evidence that was independently admissible, the Court found that was of no help here for Avon where Avon had not shown that any of the underlying evidence from the declaration was admissible. Because the corporate representative did not identify sources for most of the information in the declaration, the representative not only lacked personal knowledge but “likely” acquired the information from others who also lacked personal information.
The Court of Appeal was clear that any restrictions on the testimony of a corporate witness at trial applies equally to all parties and the burden is on the plaintiffs to prove “long-ago activities” occurred. As such, corporate defendants can rely on In re LAOSD Asbestos Cases (Ramirez v. Avon Products Inc.) (2023) 2023 WL 354915, — Cal.Rptr.3d—, along with the recent California Supreme Court decision in Berroteran v. Superior Court (2022) 12 Cal.5th 867, to prevent plaintiffs from admitting historical corporate documents and former testimony considered unfavorable to corporate defendants. The ruling by the California Supreme Court in Berroteran, relies on a general bar against admission of former testimony from a discovery deposition at trial and requires a party seeking admission of former testimony for the trial court to demonstrate that the party seeking to exclude the former testimony had “the right and opportunity to cross-examine” the witness with an interest and motive for cross-examination similar to that at trial. (Berroteran v. Superior Court., (2022) 12 Cal. 5th 867, 900.)
As for corporate depositions, In re LAOSD Asbestos Cases (Ramirez v. Avon Products Inc.) (2023) 2023 WL 354915, — Cal.Rptr.3d—, is likely to provide fodder for plaintiffs’ demands for defendants to produce corporate representatives for deposition, including multiple corporate witnesses with the Court’s reliance on Maldonado v. Superior Court (2002) 94 Cal.App.4th 1390. Plaintiffs can argue a designated corporate representative lacks personal knowledge and Ramirez requires corporate entities to produce the “right” witnesses who have personal knowledge. Defendants can show Maldonado is distinguishable in that it did not involve “long-ago activities” of a defendant corporate representative but rather a recent wrongful termination brought by the plaintiffs. The Court in Maldonado agreed it was understandable that the three corporate representatives produced for deposition had minimal knowledge regarding the plaintiffs because many employees involved in the termination of plaintiffs were no longer employees due to a subsequent bankruptcy and layoff. However, in its ruling the Court focused on the “cavalier attitude” of the corporate witnesses regarding information the Court felt should have been readily available to the witnesses produced. [Emphasis added.] For example, an available personnel file with information concerning the plaintiffs’ dates of employment and positions would have allowed the corporate human resources manager to answer questions in response to the deposition notices.
Defendants may also consider whether to identify their corporate representative as an expert witness, so that the corporate representative can testify about background information regarding their knowledge and expertise and premises generally accepted in the area of expertise. (People v. Sanchez (2016) 63 Cal. 4th 665, 685–86.) While that could allow for the admission of helpful corporate documents, designating a corporate representative as an expert could also create issues related to attorney client privilege and so such a designation should be considered cautiously.
For more information or specific guidance, please contact Lesa Meyers.