Background
Slade Fidler alleged that he was injured at an Andretti Indoor Karting and Games facility when a track attendant turned off his go-kart, causing it to stop and be struck by another kart. Before filing suit, his attorney sent AIKG a letter advising that an incident had caused Fidler injuries and requesting preservation of extensive surveillance footage. AIKG investigated, reviewed video from Fidler’s visit, preserved footage from the final two laps of his race, and allowed the remaining footage to be destroyed.
Fidler sued AIKG and related defendants for damages and later sought spoliation sanctions. AIKG moved for summary judgment and asserted a breach-of-contract counterclaim based on an agreement that included mediation, covenant-not-to-sue, and indemnification provisions. The trial court denied Fidler’s spoliation motion, granted AIKG summary judgment on his claims, and dismissed AIKG’s counterclaim on the ground that AIKG had waived alternative dispute resolution through its litigation conduct.
The Court’s Holding
The Court of Appeals vacated the denial of Fidler’s spoliation motion. The trial court found that the preservation letter gave AIKG actual notice of contemplated litigation but nevertheless held that no preservation duty arose because the letter was overbroad, vague, and insufficiently specific. The appellate court held that this reasoning applied a nonexistent legal standard. Under Georgia law, the duty to preserve relevant evidence arises when litigation is reasonably foreseeable to the party controlling the evidence. The case was remanded for reconsideration under that standard.
Because the summary-judgment ruling was influenced by the erroneous spoliation analysis, the court also vacated summary judgment for AIKG and directed the trial court to reconsider it. On AIKG’s cross-appeal, the court affirmed the finding that AIKG waived alternative dispute resolution by asserting a multicount counterclaim, engaging in discovery, and failing to timely invoke that right. But it vacated the dismissal of the remainder of AIKG’s breach-of-contract counterclaim because the trial court had not addressed AIKG’s separate theories based on the covenant not to sue and indemnification clause.
Key Takeaways
- Once the trial court found that AIKG had actual notice of contemplated litigation, it could not negate the preservation duty by applying a reasonableness standard to the contents of the preservation letter that Georgia law does not recognize.
- The summary-judgment ruling had to be reconsidered because the unresolved spoliation issue could affect whether summary judgment was proper.
- AIKG waived its contractual alternative-dispute-resolution right, but the trial court still must consider its affirmative breach-of-contract counterclaim theories based on the covenant not to sue and indemnification provision.
Why It Matters
The decision reinforces that Georgia’s preservation duty turns on whether litigation was reasonably foreseeable to the party controlling the evidence. A trial court abuses its discretion when it denies spoliation relief under an unsupported legal test after finding actual notice of contemplated litigation.
The opinion also distinguishes waiver of an alternative-dispute-resolution provision from other asserted grounds for a contractual counterclaim. Waiver of mediation or arbitration did not resolve AIKG’s separate claims based on the covenant not to sue and indemnification clause.