updated 12/22/2003 4:38:23 PM ET 2003-12-22T21:38:23

Former Chrysler chief financial officer Gary Valade testified Monday that he didn't know why notes he took on the merger that produced DaimlerChrysler were not provided to attorneys for investor Kirk Kerkorian, who is suing the automaker over the deal.

Valade testified at a hearing before a special master that he placed notes he took while the merger was being negotiated into two binders. The binders were put into a box with other material that was sent to the general counsel's office at Chrysler after the lawsuit was filed.

"At that point, they were out of my hands and I do not know what happened to them," Valade said.

Valade also said he didn't know why the documents were not included in material previously provided to Kerkorian's attorneys.

"I had absolutely no idea that documents were missing ... I had no clue that they had not been produced," Valade said.

DaimlerChrysler attorney Michael Schell, however, said Valade had some of the 61 pages with him while flying to Wilmington last week. But Schell would not specify how many of the pages. Under cross-examination by Kerkorian attorney Terry Christensen, Valade said "I had a substantial amount of notes."

The production of the documents prompted a halt in the trial last week.

DaimlerChrysler maintains that the late production of potentially important documents was an inadvertent mistake, not a deliberate attempt to hurt Kerkorian's case. Five more pages of documents were turned over on Friday, bringing the total to 66 pages, attorneys for both sides said.

Kerkorian is suing DaimlerChrysler for more than $1 billion, claiming that Daimler-Benz falsely characterized a 1998 takeover of Chrysler as a merger. Kerkorian's Tracinda Corp. was the largest Chrysler shareholder at the time of the deal.

U.S. District Court Judge Joseph Farnan Jr. ordered Monday's hearing by the special master of the court to determine why the documents were presented so late and whether Kerkorian's case was prejudiced as a result.

The special master ordered the documents unsealed at the automaker's request. Kerkorian attorney's said they had no objection to the unsealing.

U.S. Special Master Collins Seitz, who has ruled on evidence questions in the case, ruled Monday that the documents could be used as evidence. He also granted DaimlerChrysler’s request to make the documents public.

"I don't think it is helpful for me to go into the substance of these notes," the special master said.

DaimlerChrysler wanted to question Valade about the contents of the notes to address any questions about motive that Kerkorian might raise as to why the documents weren't presented until late in the trial.

Christensen argued that testimony about the contents of the notes should be saved for the trial, when it resumes. Christensen said the existence of the notes was the relevant issue for the special master's hearing.

"It is a two-day examination, just to find out who said what to whom," Christensen said.

"What's in them is not relevant to this proceeding," Christensen said.

Under cross-examination by Christensen, Valade said he did not take notes of all the meetings he attended.

"It wasn't diabolical ... I took them if I thought I needed them," Valade said.

The documents include handwritten notes submitted by Valade to DaimlerChrysler attorneys as part of the pretrial gathering of information. Valade is now director of global purchasing for DaimlerChrysler.

Excerpts from the notes presented in court last week indicate that they refer to the negotiations between Daimler-Benz and Chrysler leading up to the combination of the two companies.

Christensen, who asked Farnan to enter a default judgment for the plaintiffs, argued that the notes contradict testimony from Daimler Chrysler witnesses, including chairman Juergen Schrempp. He highlighted passages that included phrases such as "sell out for profit," "why didn't we buy?" and "senior management sold out."

It was not immediately clear whether Valade or someone else wrote those passages, which appeared to be written on the letterhead of former Chrysler president Tom Stallkamp.

DaimlerChrysler attorney Tom Allingham told Farnan lawyers for the company did not realize copies of the documents had not been provided to the plaintiffs until a discussion between Valade and DaimlerChrysler's chief counsel, William O'Brien, the day before Valade was scheduled to testify last week.

Allingham said DaimlerChrysler attorneys set about immediately to rectify the situation, and that Valade was not at fault.

In a statement issued late Sunday, DaimlerChrysler said several witnesses would testify Monday that Tracinda has suffered no prejudice as a result of the "inadvertent" late production of the documents.

"The company believes its good faith (and that of its counsel) was conclusively demonstrated by the speed with which it corrected the problem immediately upon discovery," the statement said.

DaimlerChrysler said it expects the trial, which began Dec. 1 and was to have concluded last week, to finish sometime next month.

© 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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