Opinion ID: 118161
Heading Depth: 2
Heading Rank: 1

Heading: The Suit Between Elwell and General Motors

Text: Ronald Elwell was a GM employee from 1959 until 1989. For 15 of those years, beginning in 1971, Elwell was assigned to the Engineering Analysis Group, which studied the performance of GM vehicles, most particularly vehicles involved in product liability litigation. Elwell's studies and research concentrated on vehicular fires. He assisted in improving the performance of GM products by suggesting changes in fuel line designs. During the course of his employment, Elwell frequently aided GM lawyers engaged in defending GM against product liability actions. Beginning in 1987, the Elwell-GM employment relationship soured. GM and Elwell first negotiated an agreement under which Elwell would retire after serving as a GM consultant for two years. When the time came for Elwell to retire, however, disagreement again surfaced and continued into 1991. In May 1991, plaintiffs in a product liability action pending in Georgia deposed Elwell. The Georgia case involved a GM pickup truck fuel tank that burst into flames just after a collision. During the deposition, and over the objection of counsel for GM, Elwell gave testimony that differed markedly from testimony he had given when serving as an in-house expert witness for GM. Specifically, Elwell had several times defended the safety and crashworthiness of the pickup's fuel system. On deposition in the Georgia action, however, Elwell testified that the GM pickup truck fuel system was inferior in comparison to competing products. A month later, Elwell sued GM in a Michigan County Court, alleging wrongful discharge and other tort and contract claims. GM counterclaimed, contending that Elwell had breached his fiduciary duty to GM by disclosing privileged and confidential information and misappropriating documents. In response to GM's motion for a preliminary injunction, and after a hearing, the Michigan trial court, on November 22, 1991, enjoined Elwell from consulting or discussing with or disclosing to any person any of General Motors Corporation's trade secrets[,] confidential information or matters of attorney-client work product relating in any manner to the subject matter of any products liability litigation whether already filed or [to be] filed in the future which Ronald Elwell received, had knowledge of, or was entrusted with during his employments with General Motors Corporation. Elwell v. General Motors Corp., No. 91-115946NZ (Wayne Cty.) (Order Granting in Part, Denying in Part Injunctive Relief, pp. 1-2), App. 9-10. In August 1992, GM and Elwell entered into a settlement under which Elwell received an undisclosed sum of money. The parties also stipulated to the entry of a permanent injunction and jointly filed with the Michigan court both the stipulation and the agreed-upon injunction. The proposed permanent injunction contained two proscriptions. The first substantially repeated the terms of the preliminary injunction; the second comprehensively enjoined Elwell from testifying, without the prior written consent of General Motors Corporation, either upon deposition or at trial, as an expert witness, or as a witness of any kind, and from consulting with attorneys or their agents in any litigation already filed, or to be filed in the future, involving General Motors Corporation as an owner, seller, manufacturer and/or designer of the product(s) in issue. Order Dismissing Plaintiff's Complaint and Granting Permanent Injunction (Wayne Cty., Aug. 26, 1992), p. 2, App. 30. To this encompassing bar, the consent injunction made an exception: [This provision] shall not operate to interfere with the jurisdiction of the Court in . . . Georgia [where the litigation involving the fuel tank was still pending]. Ibid. (emphasis added). No other noninterference provision appears in the stipulated decree. On August 26, 1992, with no further hearing, the Michigan court entered the injunction precisely as tendered by the parties. [1] Although the stipulated injunction contained an exception only for the Georgia action then pending, Elwell and GM included in their separate settlement agreement a more general limitation. If a court or other tribunal ordered Elwell to testify, his testimony would in no way support a GM action for violation of the injunction or the settlement agreement: `It is agreed that [Elwell's] appearance and testimony, if any, at hearings on Motions to quash subpoena or at deposition or trial or other official proceeding, if the Court or other tribunal so orders, will in no way form a basis for an action in violation of the Permanent Injunction or this Agreement.'  Settlement Agreement, p. 10, as quoted in 86 F. 3d 811, 820, n. 11 (CA8 1996). In the six years since the Elwell-GM settlement, Elwell has testified against GM both in Georgia (pursuant to the exception contained in the injunction) and in several other jurisdictions in which Elwell has been subpoenaed to testify.