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Nipponkoa Insurance Co. Ltd. v. NDK Crystal, Inc.

United States District Court, Seventh Circuit

November 26, 2013

NDK CRYSTAL, INC., et al., Defendants.


P. MICHAEL MAHONEY, Magistrate Judge.

Defendant's Motion to Strike [95] is granted in part and denied in part. See "STATEMENT" below for details.


Nipponkoa Insurance ("Plaintiff") has filed a declaratory action suit against NDK ("Defendant"), following an explosion of Defendant's pressurized "autoclave" tank in December 2009. After the explosion, Defendant made an insurance claim to cover the resulting damage and Plaintiff ultimately seeks judgment that its insurance policy does not cover the loss.

During the discovery process, Defendant deposed Mr. Raymond Quiett, Plaintiff's lead underwriter on the Defendant's insurance account. Under oath, Mr. Quiett was asked numerous questions concerning his representations to Defendant and other relevant issues. After the deposition was concluded, Plaintiff submitted an errata sheet making twenty-two changes to the answers given by Mr. Quiett. Now, Defendant objects to those errata-sheet changes and has filed a motion to strike the modifications, claiming that many of the changes in the errata sheet improperly and directly contradict Mr. Quiett's original deposition answers. Plaintiff insists that the errata-sheet changes comply with Rule 30(e)(B) Federal Rules of Civil Procedure.

Rule 30(e)(B) permits deponents to review the deposition transcript and make any "changes in form or substance" if the deponent signs "a statement listing the changes and the reasons for making them." Fed.R.Civ.P. 30(e)(B). Although the rule is seemingly straightforward and concise, many courts are still divided as far as the scope and nature of the changes permitted by Rule 30(e) are concerned. See 7 James Wm. Moore et al, Moore's Federal Practice, ΒΆ 30.60 (3d ed. 2013).

Here in the Northern District of Illinois, Judge Will set the original standard of deposition errata changes in Lugtig v. Thomas, holding that even if the written changes contradict the original deposition, they would be allowed under Rule 30(e). Lugtig v. Thomas, 89 F.R.D. 639 (N.D. Ill. 1981). Judge Will reasoned that it was better to allow the witness to change his testimony early on when signing the deposition, rather than waiting until trial to reveal any changes. Id. at 641. Certainly, if a party is able make changes to their testimony during discovery, the opposing party would be on notice of the deviations and could seek discovery on the changed testimony. Notably, the court in Lugtig also stressed that the unambiguous language of Rule 30(e) allows changes to "form and substance" and declines to place any limit on the nature of the changes themselves. Id.

Judge Will held that the original deposition testimony would remain part of the record and could be used to impeach the witness. Id. This would place the witness in the same situation as if he had changed his testimony at trial. Further, the deposition could be reopened and the witness be asked any necessary follow up questions. The costs, including attorneys' fees reasonably necessary to reconvene the deposition would be borne by the party making the changes.

Judge Will's reasoning in Lugtig was followed in this district for nearly twenty years. See Sanford v. CBS, Inc., 594 F.Supp. 713, 715 (N.D. Ill. 1984); Hawthorne Partners v. AT & T Technologies, Inc., 831 F.Supp. 1398, 1406 (N.D. Ill.1993). However, in 2000 the Seventh Circuit decided Thorn v. Sundstrand and Chief Judge Posner discussed a different interpretation of Rule 30(e). See Thorn v. Sundstrand Aerospace Corp., 207 F.3d 383, 389 (7th Cir. 2000).

Coincidentally, Thorn originated out of the Northern Illinois Western Division and this Magistrate Judge handled all discovery issues. In that case, the attorney for the defendant submitted an errata sheet for a crucial defense witness that changed the substance of the witness's testimony. There was no error in transcription reported. This Magistrate Judge allowed the errata change. Although Judge Posner agreed that the change was permitted by Rule 30(e), by analogy to cases ruling that a separate affidavit may not be used to contradict a witness deposition to defeat a Rule 56 Motion, he held that an errata change of substance that contradicts the transcript is impermissible unless it corrects an error in transcription. Id. In short, he found that a change of testimony, even substantive supplementation and explanation, is allowed under the Rule, but contradiction is not. Id.

Generally speaking, there are three instances in the litigation process when a witness has an opportunity to change his or her testimony: (1) in an errata sheet submitted directly after a deposition is taken, (2) in an affidavit to defeat a Rule 56 motion for summary judgment, and (3) during testimony at trial.

As far as the first instance is concerned, deposition changes are covered by the Federal Rule of Civil Procedure 30(e). As summarized above, Judge Posner accepted that the Rule allows a deponent to change "from what he said to what he meant, " but the changes could not actually contradict the original answers, unless correcting a transcription error. Id. As Judge Will pointed out in 1981, the plain language of the Rule allows any change; the only explicit limitation is that the errata sheet must state reasons for the change.

The second instance where a witness may change its testimony, dealing with a Rule 56 motion, is not governed by any specific Federal Rule of Civil Procedure. Yet, the Seventh Circuit has consistently held that a subsequent affidavit may not be used to contradict a witness's deposition to defeat a Rule 56 Motion for Summary Judgment (these are the cases cited by Judge Posner in Thorn by analogy to disallow actual contradictions).

The third instance where witnesses may change their testimony is during examination at trial. This is a too-common occurrence and nothing in the Federal Rules of Civil Procedure or the Federal Rules of Evidence forbids a change of testimony at trial; the witness testifies and if the testimony is contradictory, the original statement is customarily used for impeachment and it is up to the finder of fact to decide which version is correct.

It is difficult for this Court to understand why witnesses are allowed to change testimony at trial yet are not able to change their testimony with an errata sheet after being deposed during the discovery process. The source by analogy lies with Rule 56. Since 1985, appellate courts and the Supreme Court have encouraged trial judges to be more aggressive in granting Rule 56 motions. See Piscione v. Ernst & Young, L.L.P., 171 F.3d 527, 532-33 (7th Cir.1999); Bank of Illinois v. Allied Signal Safety Restraint Systems, 75 F.3d 1162, 1168-69 (7th Cir.1996); Russell v. Acme-Evans Co., 51 F.3d 64, 67-68 (7th Cir.1995); Schiernbeck v. Davis, 143 F.3d 434, 437-38 (8th Cir.1998); Raskin v. Wyatt Co., 125 F.3d 55, 63 (2d Cir.1997); Sullivan v. Conway, 157 F.3d 1092, 1096-97 (7th Cir.1998). Perhaps the only reason not to allow Rule 30(e) to be interpreted as it is written is a fear that litigants will use the errata sheets to defeat motions for summary judgment. Regardless, under Thorn it is now the rule in the Seventh Circuit that one cannot make any substantive change in one's deposition testimony that actually contradicts the original transcription unless it merely corrects an error in transcription. Thorn, 207 F.3d at 389.

Here, the parties dispute the errata changes numbered 1 through 4, 6 through 10, 12 through 15, and 17 through 22, respectively. The Court will discuss and rule upon each disputed change in order within the context of the Thorn rule:

1. Question: "Is Archway Insurance an agent or broker?"
Transcript Answer: "They are an agent."
Plaintiff's Change: "They are a broker."

This change is stricken as it is contradictory to the original answer.

2. Question: "So they work with Nipponkoa's best interest in mind, right?"
Transcript Answer: "According to the definition of agent, yes, they would be working with our interest in mind."
Plaintiff's Change: "According to the definition of agent, yes, they would be working with our interest in mind only insofar as their duties are stated in the limited agency agreement."

This change is allowed as it supplements the original answer and does not actually contradict it.

3. Question: "But you already knew that from looking at the prior exhibit which was dated in July, not in August, right, of 2007?"
Transcript Answer: "Yes."
Plaintiff's Change: ...

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