EvidenceProf Blog

Editor: Colin Miller
Univ. of South Carolina School of Law

Wednesday, August 4, 2021

District of New Mexico Finds Fraud Judgment Admissible Under Rule 608(b)

Federal Rule of Evidence 608(b) provides that

Except for a criminal conviction under Rule 609, extrinsic evidence is not admissible to prove specific instances of a witness’s conduct in order to attack or support the witness’s character for truthfulness. But the court may, on cross-examination, allow them to be inquired into if they are probative of the character for truthfulness or untruthfulness of:

(1) the witness; or

(2) another witness whose character the witness being cross-examined has testified about.

By testifying on another matter, a witness does not waive any privilege against self-incrimination for testimony that relates only to the witness’s character for truthfulness.

So, should an attorney be able to cross-examine a plaintiff about a prior judgment of fraud against him? That was the question addressed by the United States District Court for the District of New Mexico in its recent opinion in Auge v. Stryker Corp. and Howmedica Osteonics Corp., 2021 WL 3290693 (D.N.M. 2021).

In Auge, the plaintiff sued the defendants based on a dispute regarding royalty payments connected to his devices and techniques related to orthopaedic medicine and surgery. Before trial, the plaintiff filed a motion in limine asking the court to prevent defense counsel from cross-examining him regarding a judgment concluding that the plaintiff “made knowing misrepresentations,” “committed securities fraud,” “fraudulently induced” his colleagues, “committed a continuing fraud and breached his fiduciary and other duties” by “knowingly overcompensating himself,” and “breached his shareholder employment agreement and shareholder agreement.” 

The court denied the motion, ruling that

Pursuant to Federal Rule of Evidence 608(b), a court may admit evidence to prove “specific instances of a witness's conduct” if the evidence is “probative of the [witness's] character for truthfulness or untruthfulness[.]”...

[I]t is axiomatic that evidence of a prior fraud judgment is probative of a witness's character for truthfulness under Rule 608(b)....

As a result, the Court rejects Plaintiff's assertion that this evidence is irrelevant under Federal Rule of Evidence 401....

Next, the Court analyzes whether the evidence is so “remote in time” that it should be excluded from Rule 608(b)’s contemplation. Likewise, under Rule 403, “remoteness in time affect[s] the probative nature of the evidence.”...Here, Plaintiff's prior civil case was terminated in 2015, after the Supreme Court of New Mexico denied certiorari and it was remanded for a modified damages award in the district court....Under both Rules 608(b) and 403, the Court concludes the 2015 judgment is not too remote to overly dilute the probative value of the evidence....

In addition, the Court considers whether the probative value of this evidence is substantially outweighed by the danger of unfair prejudice....Here, the probative value of this evidence is enhanced by the issues underlying the parties’ dispute: what the parties intended their contractual agreement to control and whether Defendants intentionally violated that agreement for their own financial gain....Thus, Plaintiff's believability will likely play an important role in the jury's consideration of the parties’ intent under the contract.



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