Appellate Division Upholds Admission of Expert Report, Finds No Violation of Due Process Rights During Remote Trial

In an unpublished New Jersey Appellate Division opinion, the court denied a party’s claims that her due process rights were violated by two witnesses sitting in close proximity to one another during a virtual civil trial, according to the opinion.

The plaintiff, Pooja Goel, individually and derivatively on behalf of Haskell Liquors Corp. and Ledgewood Liquors Corp., appealed a trial court order that admitted an expert report and argued her due process rights were violated during the trial, which was held virtually in the Essex County, Chancery Division, according to the opinion.

Shortly after signing an operating agreement to form Haskell Liquors and Ledgewood Liquors, the parties’ relationship deteriorated drastically. Goel filed a civil complaint against defendants, Harshad Patel and others, which alleged shareholder oppression, breach of fiduciary duty, breach of covenant of good faith and fair dealing, breach of contract, unjust enrichment and conversion. Goel accused the defendants of siphoning money and intentionally misrepresenting profit margins by keeping two sets of accounting records, according to the opinion.

According to the operating agreement, Goel would possess 15% ownership interest in the two businesses, while the defendants would collectively possess 85% ownership interest.

During litigation, the parties agreed to a court-appointed forensic accountant, Megan Sartor, to examine the corporations’ business records, ultimately finding that the plaintiff’s ownership interest in Haskell Liquors Corp. and Ledgewood Liquors Corp. amounted to $61,800 and $157,116, respectively, the opinion said.

The plaintiff objected to Sartor’s report and moved to bar her testimony. However, the court found the expert to be “highly” credible and accepted Sartor’s findings.

On appeal, Goel claimed that the trial court abused its discretion when it allowed the expert’s report to be presented, arguing that Sartor relied on fraudulent and misleading information. She also contended that two witnesses “sat in close proximity during the virtual trial,” which was tainted when the witness consulted with one another.

To support that argument, Goel relied on another appellate division case, D.M.R. v M.K.G. In that 2021 opinion, the court held that a virtual trial is tainted when witnesses consult with one another during the hearing, according to the opinion.

The per curiam opinion cited a New Jersey Supreme Court, State v. Vega-Larregui, where the court rejected a constitutional challenge of its use of virtual grand juries during the pandemic. In a 7-0 decision, the court denied a motion to dismiss the indictment of Omar Vega-Larregui on drug charges, finding that allowing grand jurors to participate from home via Zoom is a temporary but necessary measure due to the severity of the COVID-19 outbreak.

“In Vega-Larregui, the Court concluded that the virtual nature of a jury proceeding did not violate the fundamental fairness doctrine or defendant’s constitutional rights, as the court took diligent precautions to preserve the sanctity of these proceedings,” stated the opinion.

But in D.M.R., the appeals court held that a defendant’s due process rights had been violated. In that case, the court held a remote final restraining order trial over Zoom, according to the opinion.

“There, plaintiff’s mother was present in the room with him throughout the trial and spoke during his testimony; the parties improperly addressed one another directly; and the court questioned the plaintiff’s mother in a manner that resembled advocacy,” stated the opinion. “Because of these errors, we concluded that the defendant had been deprived of her due process rights.”

But in Goel’s case, the court found no such procedural errors. At the outset, the court emphasized adherence to the rules of court in the virtual proceeding. When background noise could be heard during witness testimony, the court gave a similar instruction once again, according to the opinion.

“But for that sole incident, nothing in the record suggests that prospective witnesses, or other third parties, were present in the room with the testifying witnesses,” stated the opinion. “Our review of the record shows the court took appropriate precautions to maintain the integrity of the proceedings.”

The court dismissed Goel’s claim that the expert opinion was admitted improperly.

The per curiam opinion was issued by Judge Morris G. Smith and Judge Joseph L. Marczyk, temporarily assigned to the appellate division.

Counsel to Goel, Shay S. Deshpande, a solo practitioner, could not be located for comment. The defendants’ attorney, Alan J. Markman of the Law Offices of Markman & Cannan, did not immediately respond to a call seeking comment.