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May 21

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Court Requires Expert Witness to Have a Body and a Brain

A recent case addressed the interesting question of whether a corporation could serve as an expert witness.  The matter involved a breach of fiduciary duty case coordinated with an appraisal proceeding, in re Dole Food Company (“Dole”).  The defendants designated Stifel, Nicolaus & Company, Incorporated (“Stifel”), a corporation, to serve as their expert witness regarding the value of Dole.

The expert reports were signed by Seth Ferguson, a Stifel managing director, and Michael Securro, a Stifel employee, but only as authorized representatives of Stifel and not in their personal capacity.  Mr. Ferguson appeared for deposition as the person most knowledgeable (“PMK”) regarding the reports, but defense counsel objected to the suggestion that the opinions rendered belonged to him personally and reiterated that Stifel was the expert, not Mr. Ferguson.  Presumably, the distinction would allow Stifel to rely on the collective knowledge and experience of all Stifel personnel, rather than solely Mr. Ferguson.

Ultimately, the Court found that the Rules of Evidence support that a witness must be a biological person, eloquently stating:

“Lacking a voice, a corporation cannot testify. Lacking ears, it cannot hear. Lacking a mind, it cannot have personal knowledge or a memory to be refreshed. Lacking a conscience, it cannot take an oath or provide an affirmation. And because of its incorporeal nature, it cannot even meet Delaware’s statutory requirement that a person taking an oath do so “with the uplifted hand.”

A more detailed discussion regarding the Rules of Evidence the Court applied in concluding the requirements for an expert witness is found in this related article.

About the author

Renee Howdeshell

Renee Howdeshell is a founding member of Fulcrum Inquiry, an accounting, finance and economic consulting firm that performs damage analyses for commercial litigation, forensic accountings, royalty & distribution audits, financial investigations, and business valuations. Ms. Howdeshell holds a degree in Finance and Marketing from the University of Virginia's McIntire School of Commerce and is a Certified Public Accountant (CPA) and a Certified Fraud Examiner (CFE). She has testified as an expert witness in federal court, CA state court and arbitration regarding the results of her work. She can be reached at (213) 787-4112 and her resume is available at www.fulcrum.com.

Permanent link to this article: http://betweenthenumbers.net/2015/05/court-requires-expert-witness-to-have-a-body-and-a-brain/

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