United States District Court, N.D. California
ORDER RE FIFTH AMENDMENT ASSERTIONS RE: MDL DKT. NOS.
DONATO UNITED STATES DISTRICT JUDGE
witnesses affiliated with defendants asserted the Fifth
Amendment privilege against self-incrimination and declined
to answer any substantive questions when deposed during
discovery by the direct purchaser plaintiffs
(“DPPs”). The witnesses and their party
affiliations are Satoshi Okubo (at different times, Matsuo
and ELNA); Tomohiro Inoue, Shin Kinoshita and Hiroyuki Imai
(ELNA); and Noriaki Kakizaki (NCC). The witnesses were
executives employed by the affiliated defendants, and may
know facts potentially material to the price-fixing
allegations in this multidistrict litigation matter. A jury
trial is scheduled to start on March 2, 2020.
discovery and all other pretrial proceedings had closed, and
a few months before trial, defendants announced that the
witnesses had had a change of heart and would appear to
testify at trial without invoking the privilege. They filed
motions to that effect. MDL Dkt. Nos. 1030, 1045. In the
ensuing firestorm, the DPPs say that it is too late for the
witnesses to withdraw the privilege and that plaintiffs are
entitled to an adverse inference jury instruction. MDL Dkt.
Nos. 1043, 1069. The Court finds the motions suitable for
resolution without oral argument. Civil Local Rule 7-1(b).
the parties have presented the dispute as a Fifth Amendment
matter, it is at heart a discovery issue. In our federal
system, the discovery rules are intended to prevent undue
surprise at trial for parties that have been diligent in
developing the evidence. Defendants flout this principle by
seeking to present at trial five witnesses who were
effectively unavailable to the DPPs during discovery and the
preparation of pretrial materials such as expert reports and
dispositive motion filings. That is not an acceptable tactic.
On the other hand, the DPPs were advised that the witnesses
had changed their positions in late October 2019, several
months before trial, and that defendants would make the
witnesses available for deposition. MDL Dkt. Nos. 1030-7,
1030-8; MDL Dkt. No. 1045-2 ¶¶ 6-7. Rather than
scheduling the depositions or promptly raising their concerns
with the Court, the DPPs did not act, on the apparent belief
that the witnesses could not withdraw the privilege and that
an adverse inference instruction was all but inevitable.
the DPPs' inaction is not beyond question, there is no
doubt that defendants bear the lion's share of
responsibility for creating this problem. It is a serious
problem, to be sure. The DPPs credibly state that their
expert opinions, motion papers, and overall preparation of
their case for trial were affected in some measure by the
witnesses' assertion of the privilege at the depositions.
defendants revealed the witnesses' changes of heart
closer to trial, the Court would have had ample grounds to
bar trial testimony and compel them to live with their
deposition statements. See, e.g., Nationwide
Life Ins. Co. v. Richards, 541 F.3d 903, 910 (9th Cir.
2008). But there is enough time to strike a balance between
the parties' competing positions. This is a complex case
involving a price-fixing conspiracy that is alleged to have
been global and long-running. The ends of justice are best
served by ensuring that the jury, as the trier of fact, gets
as complete an understanding as is realistically possible
before passing judgement on the DPPs' claims. While the
Court appreciates that there will be some degree of
disruption of trial preparation from conducting the
depositions now, it is confident it can be managed.
the witnesses defendants have identified may withdraw the
privilege assertion and testify at trial only if they are
made available for deposition by the DPPs at a time and
location in the United States at the DPPs' convenience
(reasonably so, of course). The expectation is that the
witnesses will answer the questions for which they previously
asserted the Fifth Amendment privilege. Because defendants
caused this situation, they are ordered to pay all of the
fees and costs associated with the depositions, including
court reporter, videographer and interpreter expenses.
Defendants are also ordered to pay the reasonable
attorney's fees and costs for one lawyer representing the
DPPs to take each deposition.
witness not made available on these conditions may not
withdraw the privilege assertion or testify at trial. The
Court defers consideration of whether the DPPs should be
allowed to revise their expert reports or pending motion
papers until the depositions are completed and the DPPs have
an opportunity to evaluate their circumstances. This
possibility is by no means foreclosed. All parties are
advised that no amended reports or filings of any kind may be
filed on the basis of the depositions without the Court's
parties are also advised that the Court has not made any
final determinations on whether or to what extent a jury
instruction on an adverse inference will be given. See,
e.g., American Bar Association Model Jury Instructions
in Civil Antitrust Cases B-348 and B-350. That issue will be
taken up as warranted at a pretrial conference.