RPC 4.3 and will help to identify potential RPC 4.2 issues before they arise.
Further, plaintiffs have agreed to provide Prudential with five days' advance notice of all ex parte interviews of current or former employees who appear likely to fall into the category of employees whose conduct might, in and of itself, establish Prudential liability. Prudential, however, will not contact or attempt to contact the proposed interviewee in any manner during the time between receipt of such notice and the end of the interview. (Transcript pp. 46-49) This balances Prudential's interest in avoiding surprise with plaintiffs' right to conduct open, candid interviews. Moreover, it provides counsel in advance with the opportunity to review Prudential's files to ascertain whether an issue of privilege exists. At the interview, Prudential will not participate except to state objections on the grounds of attorney-client privilege or confidentiality. (Transcript p. 36) Finally, each side must inform opposing counsel, within ten days of such an ex parte interview, of its intention to take that person's deposition or introduce that person's testimony at trial.
If such notice is not given, the party who conducted the ex parte interview waives all rights to take or use that person's testimony in the case. Although plaintiffs have objected to this procedure on the ground that it violates the work product privilege, the Court does not believe that requiring parties to disclose information within ten days which will eventually be disclosed anyway violates any privilege -- especially given the strong competing interest in a case of this nature in efficient, cost-effective discovery. The Court believes that where a case involves an investigation into the sales and marketing practices of a force as large and geographically diverse as Prudential's, the rules set forth herein will balance the interests of all sides to this controversy and promote the cost-effective, efficient advancement of the litigation.
The arena of most heated contention, however, is not the implementation of Rule 4.2 but the question of which current and former employees it covers. The parties first dispute the scope of the "control group" with whom ex parte contact is prohibited. The proposed national class and the agents assert that the language "case or matter at issue" refers only to litigation, while Prudential argues that the word "matter" applies more broadly to the events or issues in dispute and that "not only Prudential's current and former home office corporate executives but also its current and former field managers" are thereby covered. (Prudential Moving Br. p. 13)
This Court finds that the control group must extend beyond those responsible for the conduct of the litigation; if this were all the Opinion 668 Court intended to cover, it would have used simpler language than "case or matter at issue." However, the Court does not find that every Prudential employee with the title of manager or supervisor is a member of the control group. Although the New Jersey Supreme Court did not provide much guidance as to what it meant by "management of" the case or matter at issue, this Court finds it clear that the control group can only include Prudential employees with responsibility for or significant involvement in (1) making final decisions regarding the company's conduct of the instant litigation; or (2) establishing policies or firm-wide procedures for sales or marketing of the insurance products at issue in this case. Only such employees can reasonably be termed "represented" by company counsel because only such employees might be able to speak for Prudential on any relevant question.
The parties also dispute the scope of the clause limiting access to employees "whose conduct, in and of itself, establishes the corporation's liability." The proposed national class argues that its complaint alleges "a company-wide scheme to harm policyholders formulated at high executive levels, carefully implemented by upper management . . . " and, therefore, that the conduct of a single broker cannot, in and of itself, establish Prudential's liability for the billions of dollars in damages they seek. Accordingly, the proposed national class argues, its attorneys may interview "current and former Prudential employees who possess knowledge of Prudential's wrongdoing but who were not instrumental in creating or implementing corporate policy to encourage the wrongs alleged. . . ." (Proposed National Class Br. in Opp. p.7)
Prudential, on the other hand, argues that since proof that individual brokers committed fraud is indispensable to plaintiffs' class claims, individual brokers' admissions of misconduct may be imputed to Prudential in the aggregate and plaintiffs' ex parte contacts should be restricted accordingly. As Prudential points out, plaintiffs have not disavowed a liability theory under which, even absent direct evidence of a policy or directive from upper management, the aggregated actions of numerous brokers establish that such a policy must have existed. However, even assuming that plaintiffs will proceed under such a theory, the contribution of a single broker's testimony to plaintiffs' case would still be merely evidence and not, in and of itself, the establishment of Prudential's liability. "Were we to adopt a blanket rule prohibiting interviews with all employees whose statements might be admissible against a corporation, virtually no pre-filing investigations of claims against corporations could be conducted . . . ." Id. at 300-01.
Prudential argues that plaintiffs' construction of the restriction is too narrow, and that it effectively limits its application to one employee per case. The Court disagrees. The Court recognizes that, in some situations, multiple employees could each engage in conduct which, "in and of itself," could establish corporate liability; there is obviously no rule that only one such employee exists in each case. For example, in an environmental case in which liability is strict and dozens of employees can testify that they participated in hazardous dumping, Opinion 668 would restrict ex parte interviews with each of these employees. This, however, is not such a situation.
Accordingly, the Court does not believe it is likely that an individual broker will possess the type of information that should restrict plaintiffs' right to contact him ex parte. However, in the event plaintiffs' counsel determines that an individual agent, or any other former or current Prudential employee, does have such information, the interview or proposed interview should cease immediately and resume only after Prudential has received the notice and opportunity to be present which Opinion 668 mandates.
C. Other Issues
Prudential argued in its written submissions, but not at oral argument, that this Court should preclude ex parte contacts with Prudential agents or managers based upon confidentiality agreements they signed as a condition of employment. These contracts are between Prudential and its employees, and the matters they define as confidential -- e.g., "contract values and beneficiary information . . . which may be used to solicit for sales on behalf of some other company . . ." -- are largely well outside the scope of this litigation. Although they may arguably preclude some interviewees from answering some questions plaintiffs might pose, in these limited circumstances it is up to the employee to adhere to the agreement and not to the Court to preclude the interview. Should a Prudential employee breach an enforceable obligation to Prudential, Prudential is of course free to pursue any legal remedies it might have.
Finally, the agents have requested that the Court make a specific finding that the rules governing ex parte contacts set forth herein and in Opinion 668 do not apply to them, as they are parties to the lawsuit who need to enjoy full communication with their co-plaintiffs. Prudential has not disputed the point, and the Court is obviously in full agreement that, where a former employee has become a party adverse to his former corporation, the rules governing ex parte contacts with "represented" parties do not apply to restrict that employee's contacts with other parties adverse to the corporation.
For the foregoing reasons, Prudential's motion to restrict ex parte contacts with current and former Prudential employees is granted to the extent set forth in this opinion. Plaintiffs are directed jointly to provide the Court, within ten days of the date of the attached order, with a proposed "script" to be followed by all counsel in their initial contacts with potential interviewees.
An appropriate order is attached hereto.
Dated: December 19, 1995
ALFRED M. WOLIN, U.S.D.J.1
In accordance with the Court's Opinion filed herewith,
It is on this 19th day of December, 1995
ORDERED that the motion of The Prudential Insurance Company of America to restrict ex parte contacts with current and former Prudential employees is granted to the extent set forth in the Court's accompanying Opinion; and it is further
ORDERED that plaintiffs are directed jointly to provide the Court, within ten (10) days of the date of this Order, with a proposed "script" to be followed by all counsel in their initial contacts with potential interviewees.
ALFRED M. WOLIN, U.S.D.J.