Georgia Supreme Court Rejects ‘Apex Doctrine’ | Parker Poe Adams & Bernstein LLP

On June 1, 2022, the Georgia Supreme Court issued a decision that could significantly impact discovery in Georgia courts. In Gen. Motors, LLC v Buchanan, No. S21G1147, 2022 WL 1750716 (Ga. June 1, 2022), the Court expressly rejected the apex doctrine, which limits the ability of parties to file high-ranking corporate officers, and noted the nature wide of discovery in Georgian law. If the Court’s direct analysis applied to the testimony of the corporate officers, the ramifications of the Court’s decision may turn out to be much broader.

Decision

The Buchanan the case turned directly on whether the “apex doctrine” applied in Georgia. As described in the notice, the apex doctrine is a creation of the Federal Court that shifted the burden of proof to a motion for a protective order when the issue was whether a party could remove an executive from office. high-ranking company, in this case the CEO of General Motors. General Motors and several amicus curiae argued that after demonstrating that (i) a high-ranking officer had no specific knowledge of the particular case and (ii) the information sought was available through other sources or means , deposit protection should be presumed. The net result of this doctrine ultimately shifts the burden of proof to the party requesting the deposition to prove that he needed the specific deposition in the particular case rather than to the deponent proving that the deposition should not take place.

The Georgia Supreme Court rejected this approach. Pointing out that the doctrine was not even fully established in federal courts, the Court pointed to the difference in the scope of discovery under federal law compared to Georgia law. Under federal law, Rule 26 of the Rules of Civil Procedure permits discovery of relevant issues “proportionate to the needs of the case.” Fed. A. Civil. P.26(b)(1). Georgia law permits discovery of any “non-privileged” matter that is relevant to the subject matter involved in the pending action. OCGA § 9-11-26(b). The Court pointed out that the scope of discovery in Georgia is very broad and based on the wording of the statute broader than the scope of discovery in federal courts.

As a result, the Supreme Court rejected the apex doctrine and sent the case back to the trial court to consider the petition for a protective order under the more traditional factors provided by Georgia law.

What this implies for the testimony of corporate officers

On the one hand, the decision to Buchanan makes corporate officers more likely to be removed than they would be under the apex doctrine. On the other hand, the decision can be interpreted as simply indicating that business executives are entitled to the same protection as any other witness in a Georgia case and certainly not lesser protection.

The Court clarified that it did not believe, under current Georgian law, that company directors are entitled to special protection.

High-ranking corporate executives are not immune to discovery and do not automatically receive special treatment exempting them from being deposed simply because of the positions they hold or the size of organizations. that they lead. And large multinational companies are subject to the same discovery rules in Georgia as smaller ones. Regarding the discovery rules, we said that “[t]Availability of one form of evidence does not render other forms of evidence irrelevant[.]” Bowden, 297 Ga. at 296(2)(b), 773 SE2d 692. Thus discovery is generally not limited to “single” knowledge. Very often, discovery is sought to find out what witnesses know or don’t know and to reveal inconsistencies between witnesses.

Buchanan2022 WL 1750716, at *8.

However, the Court also clarified that a corporate officer may be protected from dismissal in appropriate circumstances. A protection order can be issued under Georgian law to “protect against ‘annoyance, embarrassment, oppression or undue burden or expense'” as this decision must be made in the interests of the “justice”, which must include consideration for all concerned. parties.” Buchanan2022 WL 1750716, at *9.

In short, a corporate executive should be treated like any other witness, even if he has a much bigger target behind his back.

What this generally means for litigation in Georgia

While the Buchanan the case will receive the most publicity due to its rejection of the apex doctrine, its ultimate impact may be considerably wider. The decision clearly dictates to the state’s highest court that the discovery in Georgia is extremely broad. A party seeking to withhold information on a basis other than privilege may find the challenge it faces significant.

The very first line of the Court’s legal analysis is that “the scope of discovery under [Georgia law] is wide. Buchanan, 2022 WL 1750716, at *3. The Court also rejected attempts to use federal law to narrow the scope of discovery in Georgia. “And while we recognize as a general principle that we look to federal case law interpreting federal rules of civil procedure as persuasive authority, when the language of a Georgia statute departs from federal rules, the persuasiveness of the authority interpreting and applying the federal rules is reduced. Buchanan2022 WL 1750716, at *7.

Ultimately, any party litigating in Georgia must recognize that they may have a greater discovery burden than they would like. The starting and ending point for discovery seems to be that if a party can relate the information sought to the broad definition of relevance, it can be discovered. This will undoubtedly increase the costs associated with bringing or defending a lawsuit in Georgia.

The Supreme Court of Georgia, beacon of textualism

We recently made a point of highlighting the Georgia Supreme Court’s change to a court dominated by the judicial philosophy of textualism. Buchanan is another piece of evidence supporting this reality.

As part of its analysis rejecting the apex doctrine, the Court responded to “policy concerns about inefficiencies in discovery involving corporate defendants in the absence of mandatory application of the apex doctrine.” . .” Buchanan, 2022 WL 1750716, at *9. The Court dismissed out of hand not only the concerns, but also that the argument was properly presented to the judiciary. These “political concerns are properly addressed not by this Court, but by petitioning the General Assembly and advocating for a change in the law”. Identifier.

The Georgia Supreme Court should be viewed as a strict textualist court, and companies would do well to consider that reality not only in litigation, but also in how they approach legal issues within the state.

What this means for ADR in Georgia

Alternative dispute resolution is beyond the scope of this update. However, a direct result of Buchanan ruling appears likely to be an increase in discovery costs in Georgian courts. Any party doing business in Georgia should consider their options, including mediation, arbitration, and all other forms of alternative dispute resolution.

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