Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

BOCA INVESTERINGS PARTNERSHIP v. U.S.

December 22, 2000

BOCA INVESTERINGS PARTNERSHIP, ET AL., PLAINTIFFS,
V.
THE UNITED STATES OF AMERICA, DEFENDANT.



The opinion of the court was delivered by: Paul L. Friedman, District Judge.

OPINION AND ORDER

This matter is before the Court on plaintiffs' motion in limine to exclude defendant's Exhibits 91 and 92, which now is fully briefed. Upon consideration of plaintiffs' motion, the opposition, replies, surreplies and supplemental submissions, the Court finds that Exhibits 91 and 92 are not admissible under the business records exception to the hearsay rule, the residual exception to the hearsay rule, or as statements of co-conspirators. It therefore grants plaintiffs' motion.

Exhibit 92, entitled "CREDIT PROPOSAL" and dated April 5, 1990, describes a transaction involving ABN Bank and plaintiff American Home Products ("AHP"). At the conclusion of the proposal, the names Hans den Baas, Susan C. Casper and Susan L. Pearson, all of ABN Bank New York, are typed, but neither their names nor the names of anyone else are manually signed on the document. Exhibit 91, an internal ABN Bank memorandum from Mr. den Baas and Ms. Casper to G. Stroomer of ABN Bank's Amsterdam branch, elaborates on the transaction by providing a "calendar of events" that summarizes the mechanics of the proposed transaction. It, too, is dated April 5, 1990, and also is unsigned.

Defendant asserts that the two exhibits, taken together, describe and explain the transaction around which this case revolves. Statements made within the exhibits, defendant contends, speak to the alleged illegitimacy of the transaction and thus go to the heart of defendant's theory of its case. In their motion in limine, plaintiffs suggest that the exhibits are inadmissible at trial because they contain hearsay — statements being offered for the truth of the matters asserted that are made by individuals who have not testified, and will not testify at trial. See Rule 801(c), Fed.R.Evid. In response, defendant argues that the statements contained in Exhibits 91 and 92 are admissible under any one of three theories: (1) under Rule 803(6) of the Federal Rules of Evidence, the business records exception to the hearsay rule; (2) under Rule 807, the residual exception to the hearsay rule; or (3) as statements of a co-conspirator made during the course of and in furtherance of the conspiracy, under Rule 801(d)(2)(E). The Court finds that Exhibits 91 and 92 are not admissible under any of these theories.

A. Business Records Exception

Hearsay evidence is not admissible except as specifically permitted by rule. See Rule 802, Fed.R.Evid. If a court allows a party at trial to offer an out-of-court statement of a non-trial witness to prove the truth of the matters asserted therein, as the government asks the Court to do here, it deprives the opposing party of the opportunity to cross-examine the person who made that statement regarding its truthfulness. See generally 5 JACK B. WEINSTEIN & MARGARET A. BERGER, WEINSTEIN'S FEDERAL EVIDENCE § 802.02[2] (2000). When analyzing the underpinnings of the rule excluding hearsay, courts have noted that "[c]ross-examination may be the greatest legal engine ever invented for the discovery of truth, but it is not of much use if there is no one to whom it can be applied." United States v. Evans, 216 F.3d 80, 85 (D.C.Cir. 2000) (internal quotations omitted) (quoting California v. Green, 399 U.S. 149, 158, 90 S.Ct. 1930, 26 L.Ed.2d 489 (1970)). It is primarily for this reason that first the common law and then those who drafted the Federal Rules of Evidence permitted hearsay in the most limited of circumstances, and then usually only where the out-of-court statement has circumstantial guarantees of trustworthiness and reliability.

Rule 803(6) of the Federal Rules of Evidence, the business records exception, provides an exception to the rule excluding hearsay for records of regularly conducted activity. The theory is that if a statement is recorded in the ordinary course of a regularly conducted activity, and if it is the regular practice of the business to record such a statement, there is a sufficiently high degree of trustworthiness inherent in the document to ensure its truthfulness, making cross-examination of the person who prepared the document less necessary. Under the Rule, a "memorandum, report, record, or data compilation, in any form, of acts, events, conditions, opinions, or diagnoses" is covered by the business records exception if it was "made at or near the time by, or from information transmitted by, a person with knowledge, if kept in the course of a regularly conducted business activity, and if it was the regular practice of that business activity to make the memorandum, report, record, or data compilation." Rule 803(6), Fed.R.Evid. The Rule further states that this must be "shown by the testimony of the custodian or other qualified witness, unless the source of information or the method or circumstances of preparation indicate lack of trustworthiness."*fn1

Offering the deposition testimony of Parker Douglas, a custodian of records for ABN Bank, and Hans den Baas, an otherwise "qualified witness" of ABN Bank, the government asserts that Exhibits 91 and 92 are admissible under the business records exception because they meet all the requirements of Rule 803(6). With respect to Exhibit 92, the credit proposal, the government contends that it is a "memorandum, report, record, or data compilation . . . of acts, events, conditions, opinion, or diagnoses,"*fn2 that was made "at or near the time" of the occurrence,*fn3 was "kept in the course of a regularly conducted business activity,"*fn4 and it was "the regular practice of that business activity to make the credit proposal".*fn5 The government similarly asserts that Exhibit 91, the internal ABN Bank memorandum that apparently is an addendum to the credit proposal, is a "memorandum, report, record, or data compilation . . . of acts, events, conditions, opinion, or diagnoses,"*fn6 that was made "at or near the time" of the occurrence,*fn7 was "kept in the course of a regularly conducted business activity,"*fn8 and it was "the regular practice of that business activity to make" the memorandum.*fn9

Although the testimony of Mr. Douglas and Mr. den Baas cited by the government is adequate to satisfy several elements of Rule 803(6), it does not satisfy what is arguably the most important element: that the records themselves and the statements therein were made "by, or from information transmitted by, a person with knowledge." Plaintiffs suggest that the cited deposition testimony does little more than narrow the possible authors of the documents to one (or more) of three individuals: Mr. den Baas, Ms. Casper and/or Ms. Pearson. More importantly, plaintiffs urge, the deposition testimony completely fails to identify the source or sources of the most important information provided to one or more of those three individuals and included in the two documents: the credit proposal's narrative summary of the transaction and the memorandum's narrative calendar of events to be followed to complete the transaction. Plaintiffs suggest that even if the narrowing of the possible authors to one of three individuals is sufficient to satisfy the requirement that the exhibits' proponent identify the "person with knowledge" who generated the documents, they still are inadmissible because defendant has failed to identity the "person with knowledge" who "transmitted" the information to Mr. den Baas, Ms. Casper and/or Ms. Pearson. Such information, they maintain, is hearsay within hearsay under Rule 805 which, in turn, "indicate[s] lack of trustworthiness" under Rule 803(6). The Court agrees.

With respect to Exhibit 92, the credit proposal, Parker Douglas testified that it is likely that Mr. den Baas, Ms. Casper and/or Ms. Pearson "reviewed the contents" of the memorandum and he "assumed" that they prepared it.*fn10 Mr. Douglas stated that it was within the scope of their responsibilities to create credit proposals such as this one for ABN bank, but he could not state with certainty that any of them in fact prepared the document.*fn11 Hans Den Baas testified that while he could not remember writing the memorandum, it "would be unlikely" that it was anyone other than he, Ms. Casper or Ms. Pearson who wrote it.*fn12 As for the narrative summary contained in the credit proposal, neither Mr. Douglas nor Mr. den Baas could offer testimony regarding its source.

Such equivocal testimony hardly instills confidence in the Court that the credit proposal was written by a "person with knowledge," as Rule 803(6) requires. Even if the identity of the author can be narrowed to one or more of three individuals, the uncertainty of the source of the information on which they relied and the unknown circumstances concerning the document's preparation indicate a lack of trustworthiness that makes the credit proposal inadmissible under the business records exception. When the proponent of a document cannot point with any degree of certainty to the individual or individuals who generated it or from whom they received the most important information the document contains, there is no reliable basis on which to admit the document and accept it for its truth.

The supporting deposition excerpts offered by defendant with respect to Exhibit 91, the internal ABN memorandum, also are inadequate to justify its admission. Mr. Douglas again testified that he "assumed" that the memorandum was the type of document that Mr. den Baas and/or Ms. Casper would write and that Exhibit 91 was prepared by a person within ABN Bank with knowledge, but he could not state who in fact prepared it.*fn13 Mr. den Baas testified that while the memorandum was the type that would come from the Corporate Finance Division, he had no recollection of having written it and he did not know for certain if Ms. Casper generated it, though "she might have written it."*fn14 Again, if the Court cannot be reasonably certain of the actual source of either the memorandum itself or its most significant contents — particularly the calendar of events — or the circumstances under which they were prepared or transmitted to ABN, the Court cannot have confidence that the memorandum and the statements contained in it are sufficiently trustworthy to justify their admission. Lacking such indicia of trustworthiness, Exhibit 91 is not admissible under the business records exception to the hearsay rule.

Even if the Court were to give defendant the benefit of the doubt by determining that Parker Douglas' and Hans den Baas' testimony narrowing the sources of the credit proposal and the memorandum down to two or three possible authors was sufficient to meet the Rule 803(6) requirement that a "person with knowledge" be identified, it would still find the documents inadmissible. The narrative summary of the transaction contained in Exhibit 92 and the narrative calendar of events in Exhibit 91 are the portions of the documents that are most important to defendant and which it most wants the Court to consider for their truth. It is these portions that in defendant's view demonstrate most strongly the illegitimacy of the transaction at issue in this case. Unfortunately for defendant, however, they constitute hearsay within hearsay and thus cannot be admitted in evidence in the absence of a separate and independent exception to the hearsay rule that authorizes their admission. See Rule 805, Fed.R.Evid. But there is no such exception here.

Our court of appeals articulated the rationale for this conclusion in United States v. Baker, 693 ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.