In Re: RFC and RESCAP Liquidating Trust Litigation

Background

ResCap Liquidating Trust and Primary Residential Mortgage, Inc. were engaged in a bench trial before the court. The trial had already occurred on multiple days between February 10 and March 4, 2020, and was scheduled to resume on March 12, with closing arguments expected on March 13. Two Primary Residential Mortgage witnesses remained: Dr. Justin McCrary and James Crawford.

The court was informed that an attorney in Quinn Emanuel's New York office, who was not on ResCap's trial team, had contracted COVID-19. The New York office was temporarily closed after the attorney tested positive. Dr. McCrary, who lives in New York, and Mr. Crawford, who lives in Utah, asked not to be ordered to travel to Minnesota to testify.

ResCap proposed continuing the trial with safety measures or, alternatively, allowing the witnesses to testify by videoconference. Primary Residential Mortgage objected to videoconference testimony. Its counsel argued that Dr. McCrary's testimony would be harder to present clearly by video and objected to using deposition testimony for Mr. Crawford because the defense had not conducted redirect questioning during his deposition. Primary Residential Mortgage therefore asked the court to reschedule the final two trial days.

Legal standard

Federal Rule of Civil Procedure 43(a) generally requires trial testimony to be taken in open court. It also allows a court, for good cause and in compelling circumstances with appropriate safeguards, to permit live testimony from another location through contemporaneous transmission—that is, live transmission while the witness testifies. The court stated that deciding whether to use videoconference testimony is within its discretion.

The court recognized that videoconference testimony is not identical to in-person testimony and may reduce the factfinder's ability to observe a witness's demeanor. But it also found that modern technology can preserve live testimony and that remote testimony may be appropriate when a witness faces danger or serious discomfort from appearing in court. The court noted that inconvenience alone is generally not enough, while unexpected illness or similar circumstances may support remote testimony.

Court's analysis

The court found both good cause and compelling circumstances. It considered COVID-19's unexpected occurrence, rapid spread, potential health risks, and effect on the safety of the parties and witnesses. It also found the witnesses' concerns about traveling during the outbreak significant, particularly because they could testify from other locations.

The court concluded that appropriate safeguards could ensure accurate identification of the witnesses, prevent improper influence by people present with them, and accurately transmit their testimony. Because this was a bench trial rather than a jury trial, the court was confident it could understand Dr. McCrary's testimony through videoconference technology and address any clarity problems during the testimony.

The court also determined that videoconference testimony was preferable to delaying the trial. The trial had already extended over nearly a month and a half, the court's schedule made a prompt rescheduling uncertain, and delay could create additional preparation time for Primary Residential Mortgage's damages expert. The court also noted that continuing COVID-19 concerns could cause further delays.

Ruling

The court denied Primary Residential Mortgage's request to reschedule the final two days of trial. Instead, Judge Susan Richard Nelson ordered that the court preside over those two days by videoconference on March 12 and 13, 2020. The parties were directed to conduct direct and cross-examinations from local federal courthouses and identify those courthouses and their lead information-technology personnel by the next morning.