Source: Law 360: by Sindhu Sundar
Law360, New York (March 26, 2015, 9:31 PM ET) -- General Motors Co. CEO Mary Barra and other high-level executives face depositions this year in the unfolding saga over deadly defects in its ignition switches, a tricky proposition particularly for chief executives who must walk a thin line between offering truthful, direct answers and protecting the company, attorneys say.
Plaintiffs' attorneys announced this month that Barra will be deposed in October, ahead of a bellwether trial scheduled for January 2016 in New York. Her deposition will be the last in a series that includes current and former GM executives, including retired general counsel Mike Millikin. Plaintiffs' attorneys have indicated that they intend to use the depositions, which begin in May, to prove that the company actively covered up its knowledge of the ignition switch defect.
The executives will be able to invoke their Fifth Amendment right to refrain from answering questions, but this is a tool that both defense and plaintiffs attorneys say executives should use sparingly and with caution. An executive's decision not to answer a question can eventually make its way to the jury, who may receive an instruction that they can infer that the answer to those questions would have been unfavorable to the defendant.
Bob Hilliard of Hilliard Munoz Gonzales LLP, who will be deposing Barra in this case, told Law360 that he plans to ask the court to provide jury instructions to that effect.
"This is a case where any single one of these executives could sink the company," Hilliard said. "If they obfuscate, the jury will be angry at them for not being forthright. The CEO and these witnesses are walking on a high and thin tightrope, because the jury is going to expect the unvarnished truth from them."
Depositions of top executives, especially CEOs, tend to put the executives in the delicate position of having to answer tough questions without compromising the company, so defendants usually assert the apex employee doctrine to fight such deposition requests, attorneys say. Under the doctrine, defendants usually argue that plaintiffs' attorneys should attempt to get the information they are seeking from lower-level employees or executives instead.
GM did not invoke that defense and submitted Barra for the deposition, Hilliard said.
"She was involved in departments affected by the ignition switch issue before she was promoted to CEO," Hilliard said. "Given the scrutiny focused on GM, if they had objected to her deposition, there would have been a public backlash."
In this case, Barra will be testifying not just as the face of the company. Her decades-long work at GM also make her a crucial fact witness with potential knowledge about the workings of the various engineering departments responsible for ignition switches, attorneys say.
Before she took over as CEO in January 2014, she was a top executive on the global product development team and oversaw the "design, engineering, program management and quality of GM vehicles around the world," according to her bio on GM's website.
"She has so much institutional knowledge of pre- and post-bankruptcy GM," said Tim O'Brien of injury firm Levin Papantonio Thomas Mitchell Rafferty & Proctor PA. "Couple that with her pronouncements in the media on her knowledge of industry standards, and it makes hers a very information-rich deposition."
In responding to questioning in high-profile litigation, defense attorneys say that executives must answer in a way that is protective of their companies but not defensive, and that they should know enough about underlying facts of the litigation to demonstrate their awareness and engagement with the issues.
But they should also not make it appear that they have in-depth involvement in the issues, because that would pave the way for plaintiffs to grill them more about specific decisions, according to defense attorneys.
"Generally in these cases, CEOs can expect to be questioned on their responsibility over the underlying issues, their knowledge about what has gone on, what actions they took when they found out, or how could they have not known about certain things," said Anand Agneshwar of Arnold & Porter LLP.
"The balance is to recognize that the CEO is the face of the company and make sure he or she testifies in a sensitive manner, especially when the litigation involves injuries," he said.