Conducting A Prelitigation Investigation

Litigation attorneys are constantly bombarded with news of trial victories and defeats – millions of dollars awarded in damages in one case while a defense verdict is achieved in another. Although some attorneys may read these stories and point to the importance of assembling the right trial team, nuances in juror selection, or evidentiary rulings from the bench in identifying what tipped the scales, they may overlook the fact that the critical moments of any complex litigation come at the very beginning.

When the first whispers emerge that a client may face the challenge of product liability litigation, it is imperative that both in-house and outside counsel conduct a thorough investigation into the product and its background so that trial counsel can begin developing a comprehensive defense strategy. Why was the product developed, and for what scientific or medical purpose? What efforts were made by the company to properly research, study, investigate, and develop the product while managing the risk/benefit profile? What was done by the company after the product’s launch to ensure it operated in the marketplace as expected? Each of these components folds into the successful narrative ultimately told at trial.

These preliminary investigations hold several important strategic goals:

  • Even for products that were developed relatively recently, the passage of time can dull the memory of those who were intimately involved in the process. Years can pass from the start of litigation, through the possible creation of an MDL, to the beginning of corporate witness discovery. Quickly securing a complete understanding of the facts from key witnesses protects against the fading quality of participants’ memories. 
  • A thorough prelitigation investigation helps the client and counsel better identify any potential factual weaknesses and gaps in information that may impact the long-term litigation strategy. Further, such probing helps identify key records custodians and repositories of potentially relevant information. It ensures that proper litigation holds are placed to preserve data, documents, and information appropriately and comprehensively for future use.
  • If a potential witness is a former employee who is now outside the subpoena power of the likely litigation venue or otherwise potentially unavailable, preliminary investigations should include efforts to record or memorialize the key components of the witness’ product involvement and likely testimony so that it is preserved – both for the construction of a comprehensive factual timeline to aid in case strategy, and potentially to be used as substantive evidence.
  • Once a comprehensive preliminary investigation is performed, information gathered from witnesses in combination with a review of custodial documents can be used to create a product timeline, key document notebooks, and ultimately, an effective trial strategy. 

This article shares a few strategic considerations for conducting these initial investigations, including how to preserve critical information that is gathered and the potential risks and pitfalls.

A. Organizing the Preliminary Investigation

Determining the individuals most responsible for the product’s development, marketing, management, and post-marketing surveillance is a fundamental and critical step to developing a preliminary investigation strategy. Who were the engineers, physicians, and scientists who helped develop the product in question, the marketing team that sold it, and the clinical personnel who monitored adverse events? Depending on the complexity of the product and the size of the company, these key witness lists will vary in size. For complex organizations, especially those that may have gone through reorganization following initial development of the product, it is often helpful to create an organizational chart that clearly identifies the critical participants, defines those witnesses’ relevant job responsibilities, and creates a full understanding of the departmental hierarchy. 

 In addition to identifying key witnesses, it is critical to garner an understanding of the client’s information ecosystem, i.e., the central sources that hold relevant preclinical testing, regulatory filings, and post-marketing surveillance documents. Of course, these data will need to be thoroughly examined to identify any potentially relevant documents and to place proper litigation holds. Regulatory filings should be reviewed to ensure that all appropriate milestones were met for the regulatory pathway used to receive market approval for the product. To the extent any data or document gaps are identified, these need to be documented and quickly filled to the extent possible.

B. Options for Collecting Information During Prelitigation Investigation

Once the key employees, former employees, and stakeholders are identified, and a sampling of documents from key custodians are reviewed, the next important step is to gather information directly from these critical witnesses. 

There are multiple avenues to collect this potentially relevant information. Some lawyers will record interviews with potential witnesses – either through audio or videotaping of the questioning and answering process. Other lawyers will create internal “memos to file,” summarizing the conversations, assessing the strengths and weaknesses of the witnesses’ demeanor and recollection, and highlighting any potential obstacles created by the witnesses’ prospective testimony. And in certain circumstances, such as a witness relocating out of the country or when age or health are considerations, a lawyer may wish to memorialize the discussion in a declaration or affidavit to preserve the witness’s testimony. 

The method used to report and summarize the witness’s knowledge may depend largely on whether the witness is a current or former employee. For current employees, there is little debate that conversations between the defense counsel and the employee are protected by attorney-client privilege. Further, assuming the current employee has no plans in the near future to switch jobs, retire, or otherwise leave her employment with the client, it can usually be safely assumed that the employee will remain available to testify at the appropriate time.

Interviews and interactions with former employees are more complicated. As an initial matter, it remains an open question whether communications between defense counsel and a former employee are protected by attorney-client privilege. The former employee typically has not entered into a separate attorney-client relationship with defense counsel.  

Despite the lack of an immediate attorney-client relationship, many courts have held that communications between corporate counsel and a former corporate employee are protected by privilege where they “relate to the former employee’s conduct and knowledge . . . during his or her employment,” even if the communication takes place after the employment relationship has ended.[1] In addition, discussions “between a former employee and [her] former employer’s counsel” regarding “the matters concerning which [s]he subsequently testified at [her] deposition . . . come within the broad purview of the work-product doctrine.”[2]  So, regardless of whether the former employees are personally represented by corporate defense counsel, it is likely that communications between the former employee and the client’s lawyer will be protected by privilege so long as they address events and information directly related to the former’s employee’s job with the client. Clearly, this issue should be thoroughly vetted and researched in the likely venue’s jurisdiction before engaging in substantive discussions with former employees.

Beyond the question of privilege, defense counsel should also consider whether steps should be taken to preserve the former employee’s knowledge and potential testimony beyond simply preparing an internal memo, especially if the former employee is outside the subpoena power of the litigation’s venue. While a former employee may be willing to spend an hour or two discussing his or her historical involvement with the product, that is a substantially different “ask” from spending multiple days preparing for and sitting for a deposition. While Rule 45 of the Federal Rules of Civil Procedure permits nationwide service of a subpoena, out-of-state commissions of state court subpoenas are often more difficult. Further, there may be potential “friendly” testimony from the former employee that should be preserved to support a dispositive motion.  

In such circumstances, a declaration or affidavit of the former employee to preserve key aspects of the employee’s testimony should be considered. The focus of the affidavit or declaration should be the personal knowledge of the witness – the when, what, where, how, and why – and avoid opinion testimony and second-hand accounts or hearsay. While it is possible for an affiant to express opinions in the declaration, such opinions must be well grounded in the witnesses’ qualifications and expertise and provide sufficient factual basis for the opinion. Affidavits that fail to properly note when certain events happen, fail to properly document the source of the gathered information, or that otherwise fall outside of the scope of the personal involvement of the witness, will likely be excluded. 

The preparation of an affidavit or declaration for use in the litigation carries with it similar concerns of discoverability. Unsurprisingly, most courts have held that affidavits or declarations are not subject to work product protections.[3] When assessing the discoverability of party or witness affidavits, courts will likely look to the affidavit’s status (with many courts holding that a draft affidavit likely remains protected by work product doctrine while a finalized and signed declaration is likely not protected) and the lawyer’s role in preparing the affidavit. Despite the risk of discoverability, there are certain situations – like the possibility of losing helpful testimony – that will outweigh these discoverability concerns.

C. Conclusion

A well-organized, thoughtful early investigation is the bedrock for a successful trial strategy. In-house and outside legal counsel should appropriately plan for these investigations, identify the proper individuals with relevant knowledge, and take steps to document and summarize that knowledge to strategically defend the litigation.

[1] See Peralta v. Cendant Corp., 190 F.R.D. 38, 41 (D. Conn. 1999) (finding that privilege protection applied to communications between defense counsel and defendant’s former employee in preparation for the former employee’s deposition because those communications addressed issues within the scope of the former employee’s employment); see also Export–Import Bank of the United States v. Asia Pulp & Paper Co., 232 F.R.D. 103, 112 (S.D.N.Y. 2005) (“Virtually all courts hold that communications between company counsel and former company employees are privileged if they concern information obtained during the course of employment.”).

[2] Gary Friedrich Enterprises, LLC v. Marvel Enterprises, Inc., 2011 WL 2020586, at *6 (S.D.N.Y. May 20, 2011)(generally holding that “Although there are some aspects of attorney communications with former employees that are carved out of the attorney-client privilege, many of these communications are nevertheless protected under the aegis of the work product doctrine.” 

[3] See e.g. Folger Adam Co. v. PMI Indus., 989 WL 1851357, at *2 (S.D.N.Y. Nov. 21, 1989).  (Holding that an “affidavit is a witness’ sworn recollection, and does not, by definition include an attorney’s ‘mental impressions, conclusions, opinions, or legal theories,” so as to qualify for work product protection.)