by Andrew Flake
When we think about “successful” mediations, it is often about a financial bottom-line: what was demanded; what was paid; what potential jury verdict was avoided. The dollar-recovery can certainly be measured, and the trial exposure, especially in commercial cases, often estimated fairly well.
But the concept of success in mediation is actually broader, as anyone who has ever been involved in litigation knows. Control is key, and in addition to the economics of the case, we need to be thinking about other areas of control — control over uncertainty; control over peace of mind; control over business direction, and yes, control over time.
Sometimes overlooked, in the evaluation of a case, is the amount of mental bandwidth, and scheduling bandwidth, that litigation can consume. In the business world, executive time is a corporate resource, just like any other.
Even the CEO of one of world’s largest multinational corporations does not get a free pass where litigation in the state is concerned, regardless of the limits on her time, the lack of unique knowledge of the case, the importance and demands of the CEO role.
The Georgia Supreme Court decided a case last month, General Motors v. Buchanan, that makes this very clear. It was wrongful death action, filed in Georgia state court, involving the failure of a steering wheel angle-sensor. The Plaintiff wanted to depose GM’s CEO, Mary Barra, who had testified about GM’s investigation of that particular sensor program. GM of course objected, principally because it considered that many others at the company, as opposed to its CEO with all of the demands on her time, had actual personal knowledge.
In many federal courts, one way of dealing with such concerns has been via rules or presumptions that, at a certain level of seniority, an executive lacking unique personal knowledge should not be subject to deposition. This is the so-called “apex doctrine.”
GM argued for adoption in Georgia of the apex doctrine, presumptively making any “high-ranking” executive, without special knowledge of the case, off-limits for deposition. At a minimum, GM suggested that once it made certain showings about the burdens on Ms. Barra and her lack of knowledge, the burden should shift over to the plaintiff to demonstrate why a high-level deposition was warranted.
A unanimous Georgia Supreme Court recognized that imposition on an executive’s schedule or her limited knowledge are factors that must be considered, but declined to adopt the apex doctrine, or any similar rule or presumption. The decision of how to handle an executive deposition, and whether some protection or limit is warranted, is that of the trial court, considering the specific facts of the case before it. Nor should it apply any rule or presumption, other than the normal Georgia Rule 26 framework:
…a court must consider whether the deposition of a particular individual would cause “annoyance, embarrassment, oppression, or undue burden or expense” based on, for example, that person’s scheduling demands or responsibilities and lack of relevant or unique personal knowledge that is not available from other sources. OCGA § 9-11-26 (c).
The Justices pointed out that Georgia’s own Rule 26 is not exactly like its federal counterpart; it is broader, and it lacks the language added to federal Rule 26 that discovery sought be “proportional to the needs of the case.” They also seemed concerned about immunizing a “high-ranking” executive or managerial class, preferring a fact-specific evaluation by the trial court. In Georgia, said the Court, “High-ranking corporate executives are not immune from discovery and are not automatically given special treatment excusing them from being deposed simply by virtue of the positions they hold or the size of the organizations they lead.”
And the same is true for small, as for sprawling, companies and organizations. Not that a trial court can ignore evidence of burden, of time demands, and general business of the executive or her responsibilities: if raised by a party, the trial court is required to address them and determine whether they are “good cause” for a deposition-limit. It is just that a seat at the head of the boardroom, no matter how pressing the corporate time demands, does not result in any kind of special treatment.
Which brings us back to the value of mediation. Time is a scarce resource for all of us, and in the business world, the costs of executive participation are not always tracked as carefully as they should be. How do we measure the savings of a sound mediated settlement? It is not just in coins. It is also in space on the calendar.[The case is General Motors, LLC v. Buchanan, 2022 WL 1750716, at *8 (Ga., filed June 1, 2022).]