Litigation

Refusal to testify at debtor exam shouldn't be punished as contempt, Oregon Court of Appeals holds

By Lori Bauman

A witness at a debtor examination was improperly held in contempt for invoking her privilege against self-incrimination, according to a case decided today by the Oregon Court of Appeals.  In Redwine v. Starboard, LLC, plaintiff obtained a judgment against Starboard LLC.  Tamara Sawyer was then ordered to appear for a judgment debtor examination and to produce documents relating to Starboard and its financial affairs.  Starboard and Sawyer were both the target of an ongoing federal criminal investigation.  Sawyer appeared at the exam but refused to answer questions about her connections with Starboard or to produce documents, citing her privilege against self-incrimination.  The trial court determined that she was subject to the sanction of summary contempt.

The Court of Appeals reversed the judgment, holding that, given the criminal investigation, Sawyer was entitled to refuse to answer regarding her connections with Starboard.  This was the case even though the government might have readily obtained information about those connections from other sources. 

Full post as published by Northwest Business Litigation Blog on February 16, 2011 (boomark / email).