by David Cosgrove
The music finally stopped last week, and the dancers parted way. Any experienced trial attorney knows how challenging, if not frustrating, it can be to dance with a reticent or combative witness—particularly in front of a jury. Evasive answers and selective memory are just two of the hallmarks of a hostile witness. And when it came to Paolo Pellegrini, the SEC had to deal with a sophisticated hostile witness that the SEC itself called to the stand in its own case-in-chief in a complex civil securities fraud case.
The demonstration on how or how not to handle a hostile witness came in the early stages of the SEC civil enforcement case against “Febulous Fab” Fabrice Tourre. Mr. Tourre is the defendant because he is alleged to have spearheaded Goldman Sachs’ marketing of a doomed synthetic collateralized debt obligation that its sponsor (usually in a long position on the security) had put together and was actually shorting (betting against). But in the synthetic market, no one actually owns the instrument. Market participants bet in favor of or against the securities future performance. (Think of the folks in the stands at the race track.) Witness Pellegrini received a $175 million bonus from Goldman Sachs on the deal. Investors lost around $1 billion.
I recently attended a CLE where friend, former colleague, and well-respected attorney Sandra Wunderlich presented on how to deal with the hostile witness. Some of her insights and advice included:
Use the witness’ convenient failing memory to your advantage to challenge the credibility of his entire testimony.
Establish that the witness can clearly recall other events that happened around the event, and past events that happened in the distant past.
Elicit a series of “I don’t remember” answers clustered only around the event that is most critical to the issues of the case.
Pin the witness down to avoid a later claim that she suddenly—just in time for trial—remembered the answer. And ask whether there are any documents you can show her or that exist anywhere that would refresh her recollection.
Tips for spotting a liar: 1) Ask for the story in reverse. 2) Ask for details to break up a long narrative.
Tips for pinning a witness down: Use your preliminary questions to defeat a later claim that he didn’t understand the question.
Tips for dealing with a “chatty Cathy:” 1) Ask the question again and again if needed. 2) Be polite, but stay with it. 3) In rare cases, you might seek judicial intervention.
In sum, whether you are trying a securities case or a simple slip and fall, you need to be prepared to deal with the hostile witness at trial. Food for thought.