Less than 1.5 of all civil cases filed in federal court result in trial. So says a 2006 federal court study cited in the case of GMAC Bank v. HTFC Corporation in a February 29, 2008 memo. While this is a Pennsylvania case, it is one that is slowly developing some media attention and it is worth pointing out the issues regarding unethical and inappropriate conduct by witnesses and lawyers which occurs in both litigation and arbitration.

This statistic that 2% of civil cases filed in federal court actually end up before a jury may prove to be an argument in favor of arbitration. Parties seeking to avoid arbitration frequently claim that the arbitration process denies them a jury of their peers; notably, 98% who proceed in court still never see that desired jury.

Despite our intentionally eye-catching title of this post, we are keeping the vulgarities to a minimum. Nonetheless, you can see from the attached Court memo, that there are multiple obscene, offensive, and intimidating words and phrases used during the course of the deposition. As we’ve mentioned before, in keeping with the breezy and sometimes edgy characteristics of the blogosphere, we are not going to shy away from some of these quotations. That said, it is not our intent to wallow in this behavior. Nonetheless, lawyers are recommended to keep a copy of this opinion close at hand since, whether in arbitration or litigation, this kind of behavior does unfortunately crop up in our depositions. Thus, it is instructive.

The GMAC case involves a dispute over a number of loans where GMAC administers residential mortgage loans while HTFC takes loan applications and sells the residential mortgages to lenders such as GMAC. In this suit, GMAC claims that HTFC breached the contract by selling loans which were improperly underwritten while HTFC asserts a counter-claim for tortious interference with contract based on GMAC’s alleged improper administration of certain loans. Nonetheless, the focus of this Memo was based upon the September 26 and November 8, 2007 deposition of Aaron Wider, owner and Chief Executive Office of HTFC. The Memo is a mammoth 41-pages long where the judge remorsefully indicates that reigning in incivility by counsel and uncivil conduct by deposition witnesses have, unfortunately, become an issue for the legal profession as a whole as well as for the court system. Under the federal rules, a Motion to Compel Deposition Testimony can be filed if the deponent provides evasive or incomplete answers. Likewise, if someone’s conduct impedes, delays, or frustrates a fair examination, appropriate sanctions can be had. Both rules reference attorney’s fees.

In the summary of Wider’s conduct in the deposition is set forth in lengthy detail and has become legend in emails circulated among lawyers as well as on law-related internet sites. Short examples would be questions asking the witness to pull out a file and the deponent responding, “Open it up and find it. I’m not your fucking bitch.” As the court pointed out, “Wider used the fuck and variants thereof no less than 73 times…the word contract and variants thereof were used only 14 times.” The court determined that abusive language was used to simply intimidate and demean opposing counsel (e.g., references that the lawyer was a “joke” and a “fucking idiot”). Notably, the court also pointed out that the lawyer referenced the deponent as “Mr. Wider” while the deponent referred to counsel as “Bob.”

Also interesting was the fact that the deponent gave his own objections and interrupted the procedure by storming out at various times. We note there is some testimony cited where the deponent suggests that he have a law degree however this was not clearly confirmed in the opinion. Likewise, there was some question as to whether the witness had some mental illness which may have provoked his behavior. Yet it appeared that HTFC’s counsel, for whatever reason, did not choose to openly introduce that evidence to combat the claim for sanctions.

Ultimately, the witness was sanctioned for his behavior. Likewise, since the behavior started six (6) minutes into the deposition and continued for two (2) days, the court also found that HTFC’s counsel failed to meet his obligations by not aggressively instructing and controlling his client. There was reference to the fact that the rules would allow him to continue the deposition at another time under these circumstances (an unfortunate choice which I have never seen someone take nor do I know whether that too might result in claims of intentional and sanctionable delay and misconduct).

Ultimately, the court concluded, “Wider’s conduct was outrageous. [his lawyer’s] complicity is inexcusable. Therefore, sanctions will be imposes.” There was even a threat of more serious sanctions. Nonetheless, the ultimate cost of this behavior was $29,322.61.