The Personal Knowledge Requirement Gets Personal

In a recent decision, the Court of Appeal held that much (but not all) information learned by a person most knowledgeable (“PMK”) witness in preparation for a deposition is inadmissible hearsay. Additionally, a non-expert witness cannot avoid the personal knowledge requirement of Cal. Evid. Code § 702 by being designated as a “corporate representative.”

In Ramirez v. Avon Products, Inc., the plaintiff – Alicia Ramirez – developed mesothelioma. In her complaint, Ms. Ramirez alleged that she had been exposed to asbestos through several different ways, including through the use of Avon talcum powder products, which she used daily from the mid-1970’s to 2007.

At trial, Avon introduced a declaration from Lisa Gallo (the “Gallo Declaration”) in which Gallo stated “Avon never included or used asbestos as an ingredient or component of its cosmetics products. Since the [early 1970’s,] Avon has required its talc suppliers provide only asbestos-free talc.”

The trial court admitted Gallo’s declaration into evidence and, because of the statements contained within the declaration, granted Avon’s motion for summary judgment.

After reviewing Gallo’s employment history with Avon, the Court of Appeal reversed, reasoning that Gallo’s declaration was, at best, a “channeling” of information from other Avon employees that constituted hearsay and, at worst, was purely inadmissible hearsay that lacked personal knowledge, both on Gallo’s part and on the part of the employees that Gallo was “channeling.” As a result, the Court of Appeal reversed the trial court’s motion for summary judgment.

Personal Knowledge Requirement Under Cal. Evid. Code §702 and § 801

Lisa Gallo was hired and began working in Avon’s research and development department in January 1994. At the time Gallo’s declaration was taken, she was employed as Avon’s vice president of Global Innovation, Research, and Development. For purposes of both her declaration and deposition, Avon designated Gallo as a “person most knowledgeable” (PMK) witness and offered her as a “designated corporate representative.”

Cal. Evid. Code § 702 prohibits the testimony of a witness concerning a particular matter unless that witness has personal knowledge of the matter. Additionally, Cal. Evid. Code § 801 allows a witness to testify as an expert even if that expert does not have personal knowledge of the matter; however, even in such instances, the expert witness’ testimony must be in the form of an opinion and is further limited by the constraints set forth in subsections (a) and (b).

By designating Gallo as a PMK, Avon sought to lay the foundation for Gallo’s testimony based on Gallo’s personal knowledge, in fulfillment of § 702.

Perhaps in recognition of the fact that Gallo lacked personal knowledge of the matter in her declaration, Avon designated Gallo as a “designated corporate representative.” By labelling Gallo as a corporate representative, Avon sought to place Gallo among the ranks of an expert witness, albeit without actually designating Gallo as an expert witness. If successful, then Gallo’s declaration could stand even though Gallo had no personal knowledge of the matter in her declaration.

The Court took issue with Avon’s strategy for at least three reasons.

§702 and the Personal Knowledge Requirement

The first issue with Avon’s course of action is that Gallo only began working for Avon in 1994, yet the plaintiff’s alleged exposure to asbestos through Avon’s talcum powder began in the early 1970’s. Thus, the obvious question is: how could Gallo have personal knowledge of Avon’s talc suppliers and their practices between the early 1970’s and 1994 when she did not even work for Avon until January 1994?

The Court answered this by reasoning the only plausible way that Gallo would have been able to make such statements is through independently researching the company’s procedures prior to her employment, and relying upon the statements of Avon employees who had worked with the company before her arrival. In other words, Gallo would have had to rely upon hearsay in order to stand by the statements she made in her declaration because she couldn’t have had personal knowledge of Avon’s suppliers’ procedures prior to January 1, 1994.

The Court expressly stated, “Avon has not shown that the evidence underlying the Gallo Declaration would itself be admissible. Although Gallo does not identify any source at all for most of her information, given that she did not work at Avon until 1994, her statements involving activities before that time cannot be based on personal knowledge and must be based on hearsay.”

The Court went on to say that even if Gallo were simply “channeling” the information she had gathered from other employees who had worked for Avon prior to 1994, each of those employees whom Gallo relied upon for information should have filed their own declarations with the court. To put it bluntly, “The person should have provided his or her own declaration. The inconvenience of filing multiple declarations is not an exception to the hearsay rule.”

Additionally, because Gallo did not identify exactly which individuals were the source of her information that she relied upon when making her declaration, the Court also suggested that Gallo was “most likely ‘channeling’ information from people who not only lacked personal knowledge themselves, but acquired their information from people who also lacked personal knowledge.’”

§ 801 and the Black-and-White Lines of Expert Designation

The second issue with the trial court’s admission of Gallo’s declaration into evidence is that Gallo was not an expert witness. Avon attempted to place Gallo on par with the category of expert witness, without formally declaring Gallo an expert witness; instead of calling Gallo an expert witness, Avon called her their “corporate representative.” If successful, Gallo would be allowed to provide an opinion on the matter – namely, whether Avon’s suppliers used talc with asbestos in the 1970’s – without having personal knowledge of the truth of the matter.

Additionally, the trial court also found that Gallo’s testimony was admissible because information in Gallo’s declaration was based on Gallo’s independent review. The Court commented that it did not know what the trial court meant by the phrase “independent review,” and held that such information Gallo may have come across in her “independent review” would still be hearsay because Gallo was not an expert witness.

In sum, the Court stated, “There is no special category of ‘corporate representative’ witness…Gallo was simply a lay witness, and as such she was limited to matters as to which she had personal knowledge.”

Exhibits in Support of Declaration Were Also Inadmissible Hearsay

Finally, in a possible attempt to shore up the glaring deficiencies in Gallo’s workaround of the Evidence Code, counsel for Avon attached exhibits in support of her declaration. However, the Court still found that Gallo’s lack of personal knowledge was not cured by the exhibits because such documents were “all hearsay with no identified exception.” Specifically, four of the documents were not even prepared by Avon and the identity of the author(s) was unknown. Additionally, it was unclear when some of the documents had been prepared and whether some of the documents had been prepared in the ordinary course of business. Therefore, the documents were inadmissible as evidence.

For these reasons, the Court of Appeal held that the trial court had erred in admitting the Gallo declaration and accompanying exhibits. As a result, the Court reversed the lower court’s order that improperly granted summary judgment to Avon.

Takeaways

One takeaway is that a witness cannot avoid the personal knowledge requirement required by the California Evidence Code simply by being designated as a “corporate representative.” A witness is either an expert witness or non-expert witness and must be designated as such; there is no in-between.

A second takeaway is that the personal knowledge requirement really does mean personal knowledge. Information about the subject matter that a witness learns or comes across while preparing for a deposition or trial is still hearsay unless that witness is an expert witness. And even then, the expert witness’ testimony will still be limited to the constraints set forth in Cal. Evid. Code § 801.