business judgment rule in Georgia

2024Under Georgia law, the business judgment rule generally precludes claims against officers and directors for their business decisions that sound in ordinary negligence, except to the extent that those decisions are shown to have been made without deliberation, without the requisite diligence to ascertain and assess the facts and circumstances upon which the decisions are based, or in bad faith. 14 Again, Song offers only extremely limited facts in support of his argument. 23 FDIC v. Loudermilk, 295 Ga. 579, 585 (1) ( 761 SE2d 332 ) (2014).

2024Under Georgia law, the business judgment rule generally precludes claims against officers and directors for their business decisions that sound in ordinary negligence, except to the extent that those decisions are shown to have been made without deliberation, without the requisite diligence to ascertain and assess the facts and circumstances upon which the decisions are based, or in bad faith. 14 Again, Song offers only extremely limited facts in support of his argument. 23 FDIC v. Loudermilk, 295 Ga. 579, 585 (1) ( 761 SE2d 332 ) (2014).

2014See also In re Munford, Inc., 98 F3d 604 , 611 (B) (11th Cir. 1996) (“The business judgment rule protects directors and officers from liability when they make good faith business decisions in an informed and deliberate manner.” (citation omitted)).

2014See also In re Munford, Inc., 98 F3d 604 , 611 (B) (11th Cir. 1996) (“The business judgment rule protects directors and officers from liability when they make good faith business decisions in an informed and deliberate manner.” (citation omitted)).

2014“When we consider the meaning of a statute, we must presume that the General Assembly meant what it said and said what it meant.” Deal v. Coleman, 294 Ga. 170, 172 (1) (a) ( 751 SE2d 337 ) (2013) (citation and punctuation omitted).

2014“When we consider the meaning of a statute, we must presume that the General Assembly meant what it said and said what it meant.” Deal v. Coleman, 294 Ga. 170, 172 (1) (a) ( 751 SE2d 337 ) (2013) (citation and punctuation omitted).

2014See, e.g., Auerbach, 47 NY2d at 629-631 ; Heimann v. American Express Co., 279 NYS2d 867, 881 (N.Y.

2014See, e.g., Auerbach, 47 NY2d at 629-631 ; Heimann v. American Express Co., 279 NYS2d 867, 881 (N.Y.

2014In Flexible Products Co. v. Ervast, 284 Ga. App. 178 ( 643 SE2d 560 ) (2007), the Court of Appeals said that the rule “forecloses liability in officers and directors for ordinary negligence in discharging their duties,” 284 Ga. App. at 182 (2) (b) (ii), and a few years later, in Brock Built, LLC v. Blake, 300 Ga. App. 816 ( 686 SE2d 425 ) (2009), it reasoned that “allegations amounting to mere negligence, carelessness, or lackadaisical performance are insufficient as a matter of law [to overcome the business judgment rule].” 5 300 Ga. App. at 822 (3).

2014In Flexible Products Co. v. Ervast, 284 Ga. App. 178 ( 643 SE2d 560 ) (2007), the Court of Appeals said that the rule “forecloses liability in officers and directors for ordinary negligence in discharging their duties,” 284 Ga. App. at 182 (2) (b) (ii), and a few years later, in Brock Built, LLC v. Blake, 300 Ga. App. 816 ( 686 SE2d 425 ) (2009), it reasoned that “allegations amounting to mere negligence, carelessness, or lackadaisical performance are insufficient as a matter of law [to overcome the business judgment rule].” 5 300 Ga. App. at 822 (3).

2014See Lindner Fund, Inc. v. Waldbaum, Inc., 82 NY2d 219, 224 (N.Y. 1993).

2014See Lindner Fund, Inc. v. Waldbaum, Inc., 82 NY2d 219, 224 (N.Y. 1993).

2014See, e.g., Auerbach, 47 NY2d at 629-631 ; Heimann v. American Express Co., 279 NYS2d 867, 881 (N.Y.

2014See, e.g., Auerbach, 47 NY2d at 629-631 ; Heimann v. American Express Co., 279 NYS2d 867, 881 (N.Y.

2014In Flexible Products Co. v. Ervast, 284 Ga. App. 178 ( 643 SE2d 560 ) (2007), the Court of Appeals said that the rule “forecloses liability in officers and directors for ordinary negligence in discharging their duties,” 284 Ga. App. at 182 (2) (b) (ii), and a few years later, in Brock Built, LLC v. Blake, 300 Ga. App. 816 ( 686 SE2d 425 ) (2009), it reasoned that “allegations amounting to mere negligence, carelessness, or lackadaisical performance are insufficient as a matter of law [to overcome the business judgment rule].” 5 300 Ga. App. at 822 (3).

2014In Flexible Products Co. v. Ervast, 284 Ga. App. 178 ( 643 SE2d 560 ) (2007), the Court of Appeals said that the rule “forecloses liability in officers and directors for ordinary negligence in discharging their duties,” 284 Ga. App. at 182 (2) (b) (ii), and a few years later, in Brock Built, LLC v. Blake, 300 Ga. App. 816 ( 686 SE2d 425 ) (2009), it reasoned that “allegations amounting to mere negligence, carelessness, or lackadaisical performance are insufficient as a matter of law [to overcome the business judgment rule].” 5 300 Ga. App. at 822 (3).

2019Thus, the trial court made no rulings on the [applicability of the exculpatory provision or the business judgment rule] or on the question of ... damages, ... which are issues to be decided by the trial court in the first instance." Id.

2019Thus, the trial court made no rulings on the [applicability of the exculpatory provision or the business judgment rule] or on the question of . . . damages, . . . which 11 are issues to be decided by the trial court in the first instance.” Id.

2014The Florida statute “provided that directors were to perform their duties in good faith, in a manner reasonably believed to be in the best interests of the corporation, and with such care as an ordinary prudent person in a like position would use under similar circumstances.” 89 F3d at 1516 (punctuation and emphasis omitted).

2014But the statutory standard was not inconsistent with the business judgment rule, for, as the Eleventh Circuit explained: The court-made [business judgment rule] does not change [the Florida] statutory simple negligence standard to a gross negligence standard; it merely protects directors who exercised reasonable diligence in the first instance from liability on the merits of their business judgment, unless they acted fraudulently, illegally, oppressively, or in bad faith. *593 Id. at 1518 .

2014To begin, we note that the general standard of care described in the first sentence of OCGA § 7-1-490 (a) does not appear to differ in any meaningful way from the standard adopted at common law in Georgia, see Woodward, 149 Ga. at 628 , and as we have explained, the standard at common law was 18 concerned with the way in which business decisions were made — not their wisdom — and in any event, it fit comfortably with the business judgment rule.

2014To begin, we note that the general standard of care described in the first sentence of OCGA § 7-1-490 (a) does not appear to differ in any meaningful way from the standard adopted at common law in Georgia, see Woodward, 149 Ga. at 628 , and as we have explained, the standard at common law was concerned with the way in which business decisions were made — not their wisdom — and in any event, it fit comfortably with the business judgment rule.

2014Other courts have found the business judgment rule inapplicable in a general partnership context because the rule is a function of the “unique corporate setting.” See, e.g., Henkels & McCoy, Inc. v. Adochio, 138 F3d 491, 502 (3d Cir. 1998) (citation omitted).

2014Other courts have found the business judgment rule inapplicable in a general partnership context because the rule is a function of the “unique corporate setting.” See, e. g., Henkels & McCoy, Inc. v. Adochio, 138 F.3d 491 , 502 (3d Cir. 1998) (citation omitted).

2024There, the Eleventh Circuit held that, if “a board’s consideration of [a shareholder’s] demand was dominated by a law firm that represents or previously represented an alleged wrongdoer in criminal proceedings related to the very subject matter of the demand, then the shareholder raises a reasonable doubt that the board’s rejection of his demand was an informed decision protected by the business judgment rule.” Id. at 407 (III) (A) (1) (a).That situation does not apply here, as Daniel represented Champion in its separate action against Song, and not the alleged individual corporate wrongdoer,

2021Unlike in Rymer v. Polo Golf and Country Club Homeowners Assn., Inc., 335 Ga. App. at 174, where a Polo Golf lot owner asked the trial court to find that the HOA breached its duty by not exercising its Declaration remedies against other lot owners, this appeal does not present the question of whether a corporation has exercised its discretion over its own affairs lawfully and in good faith. 18 involuntary servitude in violation of the United States and Georgia Constitutions.

2021Unlike in Rymer, 335 Ga. App. at 174 , where a Polo Golf lot owner asked the trial court to find that the HOA breached its duty by not exercising its Declaration remedies against other lot owners, this appeal does not present the question of whether a corporation has exercised its discretion over its own affairs lawfully and in good faith. 18 involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.”); Ga. Const. Art.

2014See, e.g., Woodward, 149 Ga. at 628 ; McEwen, 140 Ga. at 722-723 (1).

2014See note 2, supra. Although this presumption may be rebutted, the plaintiff bears the burden of putting forward proof sufficient to rebut it.