Judge Stephen J. Schuster did not give a timeframe for his ruling on the issue, though it is unlikely to come this week. He acknowledged that regardless of his decision, the losing side would probably appeal.
Dwight Davis, the lead attorney for the electric cooperative who asked for Schuster to decide the issue, told the court that the EMC board wants to hire Brown back as president and CEO, but without a contract. Brown instead would be an at-will employee, Davis said, and he insisted that the settlement language means only that Brown would not seek to continue his employment.
To that end, business consultant J.W. Rayder, who helped negotiate the 2008 settlement on behalf of the EMC, testified that unlike President Lyndon B. Johnson — who in 1968 famously told the nation he would not seek nor would he accept his party’s nomination for president — the settlement does not preclude the cooperative’s board of directors from rehiring Brown as president and CEO.
But Pitts Carr, the attorney for the plaintiffs, insists the settlement language and subsequent announcements by the cooperative are clear that Brown must be succeeded by someone else.
Brown, who has been doing consulting work for the EMC at an unspecified fee since he retired, was not in the courtroom for Wednesday’s daylong hearing.
Rayder, the business consultant, lives in Chevy Chase, Md., and is CEO of Ashby Consulting. He is also chairman of the management committee of Gas South — a wholly owned subsidiary of Cobb EMC — for which he is paid $30,000 a month, he told the court. He bills Cobb EMC about $40,000 to $50,000 per month in consulting fees, at a rate of $400 per hour, he testified.
Davis asked Rayder what would have happened if the plaintiffs had, in 2008, insisted that Brown could not be rehired.
“There would not have been a settlement,” Rayder said.
Plaintiff’s attorney Carr did not call any witnesses on Wednesday, though he said the Cobb EMC board had paid headhunter firm Russell Reynolds $250,000 to help find a replacement for Brown.
Steven E. Fox, a partner at the Atlanta law firm of Rogers & Hardin who advises the EMC board’s governance committee, testified that the committee, which is chaired by Sarah Brown, had interviewed four external candidates brought by Russell Reynolds. They also interviewed four candidates who are already employed by the cooperative.
“But after much discussion, the committee concluded that Dwight Brown — who was not a candidate — was the person best suited to lead EMC. I told them no one was off-limits. Some were very able candidates, but in the board’s view, they were not as well-suited as Dwight Brown,” Fox said.
Fox, who has advised EMC’s governance committee since 2008, also insisted that the settlement language and EMC’s succession plans were clear.
“He couldn’t seek it (the CEO’s job). But that’s very different from accepting it,” Fox testified.
Russ Wofford, another attorney representing the EMC, asked Fox why the plaintiffs did not exactly specify in the deal that Brown could never be rehired.
“It was a deal they couldn’t get,” Fox replied. “And it probably was unenforceable. A sitting board can’t bind another board. They got what they could get” in the agreement.
In closing, Carr said he believed that “the whole successor interview process was a sham.”
“I was the lead negotiator for the plaintiffs in the settlement agreement, and it was under no circumstances our understanding that Dwight Brown could be rehired,” he said.