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Barry v. Trustees of the International Association Full-Time Salaried Officers and Employees of Outside Local Unions and District Counsel's Pension Plan

December 22, 2006


The opinion of the court was delivered by: John D. Bates United States District Judge


A bench trial in this breach-of-fiduciary-duty suit under the Employment Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001-1461, is scheduled to commence on February 5, 2007. In advance of that trial, defendant Jacob West filed a motion in limine seeking to exclude three categories of documentary evidence that plaintiff plans to introduce: (1) reports issued by committees of the United States Senate and House of Representatives ("Senate Report" and "House Report"); (2) memoranda ("Winston & Strawn Memos") prepared by attorneys at the law firm of Winston & Strawn during an internal investigation of former defendant Union Labor Life Insurance Company, Inc. ("ULLICO"); and (3) the investigative report prepared by former Illinois Governor James Thompson in his capacity as chairman of Winston & Strawn ("Thompson Report"). Plaintiff, in opposing defendant's motion, has clarified that he does not intend to introduce the Thompson Report itself, but does plan to rely on at least some of the 113 exhibits attached to the report. Defendant has responded with a supplemental memorandum challenging the admissibility of those 113 exhibits as well. For the reasons that follow, the Court will grant in part and deny in part defendant's motion in limine.


The lengthy factual and procedural history of this case, which is fully set forth in two prior opinions of the Court, will not be repeated here. See Barry v. Trustees of the International Ass'n of Full-Time Salaried Officers and Employees of Outside Local Unions and District Counsel's (Iron Workers) Pension Plan, Civ. A. No. 02-2371, 2006 WL 2507557, at *1-*3 (D.D.C. Aug. 29, 2006) ("Barry II"); Barry v. Trustees of the International Ass'n of Full-Time Salaried Officers and Employees of Outside Local Unions and District Counsel's (Iron Workers) Pension Plan, 404 F. Supp. 2d 145, 148-50 (D.D.C. 2005) ("Barry I"). For purposes of the present motion, it suffices to recount the information that follows. Since the Court's ruling in Barry I and its subsequent order granting plaintiff's motion to reconsider certain aspects of that decision, Jacob West has been the only remaining defendant. The only counts still pending against West are Counts III and IV of the Second Amended Complaint, which allege that West breached his fiduciary duties to the employee pension benefit plan ("the Plan") in which plaintiff participates. Specifically, plaintiff alleges in those counts that West, a director of ULLICO and a trustee of the Plan, failed to disclose to the Plan the details of a ULLICO discretionary stock repurchase program from which plaintiff claims the Plan could have significantly benefitted. Barry II, 2006 WL 2507557, at *4; Barry I, 404 F. Supp. 2d at 153.

In Barry II, this Court found "that there [were] genuine issues of material fact regarding whether West was aware of the relevant information, whether the information would have been material to the Plan, and whether any alleged failure to disclose on the part of West caused the Plan to suffer a loss." 2006 WL 2507557, at *4. The Court thus denied the parties' cross-motions for summary judgment on Counts III and IV. In so ruling, the Court acknowledged that some of the documents on which the parties were relying presented potential hearsay problems. See id. at *5-*9 & nn.2-5. For instance, the Court noted that the Thompson Report "is a written, out-of-court statement that West [was seeking] to use as proof of the matters asserted therein," and that the "Report may not fit within any of the established exceptions to the hearsay rule[.]" Id. at *6 n.3. The Court emphasized in two other footnotes that consideration of statements by ULLICO Chief Executive Officer Robert Georgine contained in minutes from a key meeting was "not foreclosed by hearsay limitations because" those statements had not been offered to prove the truth of the matter asserted. Id. at *5 n.2; id. at *7 n.4.

With the bench trial set to commence on February 5, 2007, West moved to bar plaintiff from introducing into evidence a number of documents, including the ones identified by the Court in Barry II, that arguably constitute hearsay. After reviewing the parties' memoranda of law and conducting an independent review of the pertinent evidentiary rules and case law, the Court concludes that some but not all of the materials challenged by West must be excluded. The Court further concludes, in light of plaintiff's representation that he no longer intends to introduce the Thompson Report into evidence, that defendant's challenge to the admissibility of that Report is now moot. Finally, plaintiff's failure to identify with precision which portions of certain materials he seeks to introduce requires the Court to defer resolving some of defendant's challenges until after plaintiff provides his final exhibit list.


The admissibility of three categories of documentary materials is currently in dispute:

(1) the House and Senate Reports, (2) the Winston & Strawn Memos, and (3) the 113 exhibits attached to the Thompson Report. Defendant contends that the documents constitute inadmissible hearsay because they are out-of-court statements "offered in evidence to prove the truth of the matter asserted." Fed. R. Evid. 801(c), 802. Plaintiff counters that the reports issued by the House and Senate committees are exempt from the bar against hearsay evidence as reports issued by a public office or agency. See Fed. R. Evid. 803(8). As to the Winston & Strawn Memos, plaintiff maintains that all of the relevant memoranda should be admitted under the residual exception to the hearsay rule, Fed. R. Evid. 807, because they are especially trustworthy and highly probative on the disputed issue of damages. Pl.'s Opp'n at 5-6. Plaintiff argues in the alternative that at least two memoranda, which chronicle interviews with Joseph Carabillo and John Grelle, should be admitted under Rule 803(8) because the Senate staff re-interviewed the two men and the Senate adopted "their Winston & Strawn interviews . . . as part of the factual findings of the agency." Id. at 6. Finally, plaintiff maintains that the exhibits to the Thompson Report are exempt from the hearsay bar as records kept in the course of regularly conducted business activities. See Fed. R. Evid. 803(6). For ease of analysis, the Court will address each set of materials separately, starting with the House and Senate Reports.

A. House and Senate Committee Reports

Both the House of Representatives and the Senate reacted to the news of corporate malfeasance and possible director misconduct at ULLICO by initiating investigations in 2003. In the Senate, the Committee on Governmental Affairs took the reigns, studying the Thompson Report and a response to that report prepared by the law firm of Sidley, Austin, Brown & Wood; requesting and reviewing over fifty boxes of documents produced by ULLICO; analyzing the Winston & Strawn memos; and interviewing (or re-interviewing) key figures identified in the Thompson Report. See Majority Staff of the S. Comm. on Governmental Affairs, 108th Cong., 2d. Sess., Self-Dealing and Breach of Duty at ULLICO, Inc. 6 (Comm. Print June 2, 2004) ("Senate Report"). The Committee also conducted a hearing on June 19, 2003. Self-Dealing and Breach of Duty: A Review of the ULLICO Matter, Hearing before the S. Comm. on Governmental Affairs, 108th Cong., 1st Sess. (June 19, 2003), transcript and exhibits available at At that hearing, the Committee heard testimony from, and posed questions to, former Governor Thompson and Terence O'Sullivan, who had replaced Robert Georgine as ULLICO's Chairman and Chief Executive Officer. Both Georgine and Chief Legal Officer Joseph Carabillo were invited to testify, but they invoked their Fifth Amendment rights against self-incrimination and declined to appear. See id. at 3 (Opening Statement of Sen. Collins). These investigative efforts culminated in the report at issue here, a ninety-eight-page document to which the Senate Committee appended an extensive set of exhibits.

The House Committee on Education and the Workforce pursued its own investigation at virtually the same time. In March of 2003, the Committee sent Georgine a letter requesting the production of documents and records in connection with the investigation into the actions of ULLICO's Board of Directors. See H. Comm. on Education and the Workforce, 108th Cong., 1st Sess., Report on Investigation of ULLICO, Inc., Apx. A (Comm. Print Oct. 14, 2003) ("House Report"). A follow-up letter sent less than two weeks later reiterated the Committee's demand for a copy of the Thompson Report, which, according to media reports, ULLICO had agreed to release to the public in the interim. See House Report, Apx. B. These requests yielded approximately 95,000 pages of documentary evidence, including the Thompson Report. House Report at 1. As the Senate did, the House Committee convened a hearing in June of 2003. Id., Apx. E (The ULLICO Scandal and its Implications for U.S. Workers, Hearing before the H. Comm. on Education and the Workforce, 108th Cong., 1st Sess. (June 17, 2003)). Georgine, summoned by a subpoena, invoked his Fifth Amendment right and refused to testify. Id., Apx. E at 10. The House Committee thus heard testimony from only (1) a local lawyer with an expertise in pension fund and fiduciary matters, and (2) the counsel to ULLICO's Chairman of the Board.

The hearing also provided an opportunity for the House Committee members to assail the conduct of ULLICO's former directors and for minority members to chide their counterparts in the majority for failing to investigate other highly publicized corporate scandals with the same vigor they had shown in pursuing the ULLICO matter. See, e.g., Apx. E at 2 (Rep. Boehner) (noting that the Committee was prompted to act by facts suggesting that "at the same time organized labor was decrying corporate wrongdoing and corporate greed, many of the leaders of the same unions were, in fact, themselves profiting at the expense of rank and file union members and their families"); id. at 4 (Rep. Miller) ("Frankly, I wish the majority was as interested in investigating the billions of dollars employees lost in company 401(k) plans due to corporate fraud and abuse as it is in investigating the ULLICO transactions."). Indeed, ranking member Congressman George Miller went so far as to include in the House Committee report a summary of the minority's views on the issues, in which he noted that "[t]he Minority was never asked or permitted to participate in preparing the report." House Report at 306. The fruit of the House Committee's labors - - a thirteen-page report that largely borrowed its factual findings and legal conclusions from the Thompson Report - - was likewise a far cry from the final product released by the Senate. One reason for the difference between the two reports may well have been time; whereas the House completed its report on October 14, 2003, the Senate did not do so until June of 2004.

With this sketch of the Congressional reports in mind, the Court turns to the governing legal framework. Assuming that plaintiff would introduce the House and Senate Reports to demonstrate the truth of the factual findings and conclusions set forth therein, the reports constitute hearsay and are inadmissible unless they fall within one of the exceptions enumerated in the Federal Rules of Evidence. See Fed. R. Evid. 802. Plaintiff argues that the reports are admissible under Rule 803(8), which exempts from the bar on hearsay evidence [r]ecords, reports, statements, or data compilations, in any form, of public offices or agencies, setting forth (A) the activities of the office or agency, or (B) matters observed pursuant to duty imposed by law as to which matters there was a duty to report, excluding, however, in criminal cases matters observed by police officers and other law enforcement personnel, or (C) in civil actions and proceedings and against the Government in criminal cases, factual findings resulting from an investigation made pursuant to authority granted by law, unless the sources of information or other circumstances indicate lack of trustworthiness.

More specifically, plaintiff seeks to admit the Congressional reports under the last clause of this rule, one that applies in civil actions to "reports . . . of public offices or agencies, setting forth . . . factual findings resulting from an investigation ...

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