Clinic Realty L L C v. Lexington Insurance Co

CourtDistrict Court, W.D. Louisiana
DecidedMarch 5, 2024
Docket2:22-cv-05724
StatusUnknown

This text of Clinic Realty L L C v. Lexington Insurance Co (Clinic Realty L L C v. Lexington Insurance Co) is published on Counsel Stack Legal Research, covering District Court, W.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Clinic Realty L L C v. Lexington Insurance Co, (W.D. La. 2024).

Opinion

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF LOUISIANA LAKE CHARLES DIVISION

CLINIC REALTY L L C : CASE NO. 2:22-CV-05724

VERSUS : JUDGE JAMES D. CAIN, JR.

LEXINGTON INSURANCE CO : MAGISTRATE JUDGE LEBLANC

MEMORANDUM ORDER

Before the court are two motions compel. The first, Clinic Realty LLC’S Motion to Compel Discovery Responses, seeks an order compelling more complete responses to certain items of discovery. Doc. 19. The second, Plaintiff Clinic Realty LLC’s Motion to Compel Defendant’s Rule 30(b)(6) Deposition, seeks relief in advance of defendant’s upcoming Rule 30(b)(6) deposition on March 7, 2024, in light of objections to various deposition topics raised by Defendant, Lexington Insurance Company (“Lexington”). Doc. 20. Lexington opposes both motions. Docs. 23, 24. Clinic Realty has replied [doc. 25], and the motions are ripe for ruling. For the reasons that follow, it is hereby ORDERED that the motion to compel discovery responses [doc. 19] is GRANTED. It is FURTHER ORDERED that the motion to compel Defendant’s Rule 30(b)(6) Deposition [doc. 20] is GRANTED IN PART and DENIED IN PART. The incorporated motions for attorneys’ fees associated with each motion to compel will be addressed by separate ruling. The parties are to contact the undersigned for guidance should any dispute arise during the upcoming deposition. I. BACKGROUND Plaintiff Clinic Realty LLC owns a medical office building in Lake Charles, Louisiana. It is undisputed that the building was damaged in Hurricanes Laura and Delta, which made landfall near Lake Charles on August 27, 2020, and October 9, 2020, respectively. At all relevant times, the property was insured by a policy of insurance issued by Defendant, Lexington Insurance Company. Doc. 1, att. 1, p. 3. Clinic Realty filed suit in state court,1 alleging that Lexington made inadequate and untimely payments on the claim and raising claims of breach of insurance contract and bad faith under Louisiana law. Lexington removed the case to this court, and it is set for trial before the district judge on April 22, 2024.

The discussion that follows draws on the district court’s memorandum order in Chennault International Airport Authority v. Starr Surplus Lines Ins. Co., No. 2:22-cv-2735 (W.D. La. 7/20/23)(Doc. 76), and discovery should proceed consistent with that opinion, as outlined below. The Court acknowledges the district court’s upcoming ruling on a motion to quash [doc. 84] filed by defendant in Mancuso v. Starr Surplus Lines Ins. Co., No. 2:21-cv-3947 (W.D. La. 2/23/24), and the court reserves the right to revisit this ruling to the extent that the Mancuso ruling materially modifies its prior ruling in Chennault. II. LAW AND APPLICATION A. Governing Law Rule 30(b)(6) provides the mechanism for deposing a corporation. Under this rule, the party requesting the deposition must “describe with reasonable particularity the matters for examination.” Fed. R. Civ. Proc. 30(b)(6). The corporation then designates a person or persons

1 Clinic Realty LLC v. Lexington Ins. Co., No. 2022-3879D (La. 14th JDC 8/18/22). Doc. 1, att. 1. who will testify on its behalf and through which it provides responses to the noticed topics. Id.; Resolution T. Corp. v. S. Union Co., 985 F.2d 196, 197 (5th Cir. 1993). Additionally, Rule 26 sets a broad scope for discovery: Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Information within this scope of discovery need not be admissible in evidence to be discoverable.

Fed. R. Civ. Proc. 26(b). Courts must limit the frequency or extent of discovery if they determine that (1) the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, and less expensive; (2) the party seeking discovery had ample opportunity to obtain the information; or (3) the proposed discovery is outside the scope of Rule 26(b)(1). Fed. R. Civ. P. 26(b)(2)(C). The court should also limit discovery that is not proportional to the needs of the case. Carr v. State Farm Mut. Auto. Ins. Co., 312 F.R.D. 459, 468 (N.D. Tex. Dec. 7, 2015) (citing Crosby v. La. Health Serv. & Indem. Co., 647 F.3d 258, 264 (5th Cir. 2011)). Finally, “[t]he court may, for good cause, issue an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense.” Fed. R. Civ. P. 26(c)(1). B. Application to Disputed Discovery Requests Clinic Realty’s motion to compel discovery responses [doc. 19] references five general categories of items for which they seek more thorough responses: 1) loss reserves, 2) guidelines, protocols, and forms; 3) reinsurance; 4) claims handlers’ files; 5) other depositions. Each general category references one or more discovery requests or obligations—initial disclosures, requests for admission, interrogatories, and/or requests for production—that call for defendant to produce information relevant to that category. For the sake of clarity and precision, to the extent this ruling orders Lexington to produce additional information, this opinion generally focuses on the text of the request(s) for production associated with each category of document. 1. Loss Reserves

Clinic Realty seeks information relating to loss reserves, referencing Initial Disclosures 4(a),(c), and (g); Requests for Admission Nos. 8, 10, and 11; Interrogatory No. 16; and Request for Production No. 12. In its opposition memorandum [doc. 24], Lexington indicates that it will “supplement its discovery responses prior to the Rule 30(b)(6) deposition and produce the redacted information as to the reserves set during the adjustment of Plaintiff’s Hurricane Laura and Delta claims.” Doc. 24, p. 4. But Lexington maintains its objections to the parts of Interrogatory 16 and Request for Production 12 that seek documents and “information related to the financial and tax reporting and/or accounting for Lexington’s reserves, reinsurance claim(s), rough orders of magnitude, and/or payments for the losses, damages…” Id. Clinic Realty’s Request for Production No. 12 and Lexington’s response reads as follows:

REQUEST NO. 12. Please produce a copy of every document, claims-file entry, note, communication, journal entry, and ledger balance that reflects Your loss reserves booked for the Claims. RESPONSE: LEXINGTON incorporates by reference each of its General Objections as though fully set forth herein. LEXINGTON also objects to Request No. 12 as it seeks confidential, proprietary or otherwise protected business or commercial information and information relating to reserves, which is not reasonably calculated to lead to the discovery of relevant or admissible information.

Interrogatory No. 16 seeks narrative answers as to financial and tax reporting and/or accounting for Lexington’s loss reserves, reinsurance claims, rough orders of magnitude and/or payments. Consistent with the Chennault decision referenced above, the information sought via Request for Production No. 12 and Interrogatory No. 16 is discoverable.

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Clinic Realty L L C v. Lexington Insurance Co, Counsel Stack Legal Research, https://law.counselstack.com/opinion/clinic-realty-l-l-c-v-lexington-insurance-co-lawd-2024.