JEREMIAH THOMAS * NO. 2020-CA-0475
VERSUS * COURT OF APPEAL WASTE MANAGEMENT OF * LOUISIANA, LLC D/B/A FOURTH CIRCUIT WASTE MANAGEMENT NEW * ORLEANS HAULING AND STATE OF LOUISIANA WARDELL ALLEN *******
APPEAL FROM 25TH JDC, PARISH OF PLAQUEMINES NO. 62-894, DIVISION “A” Honorable Kevin D. Conner, Judge ****** Judge Edwin A. Lombard ****** (Court composed of Judge Terri F. Love, Judge Edwin A. Lombard, Judge Tiffany G. Chase)
Jeffery A. Mitchell Monica C. Sanchez Hugo L. Chanez MITCHELL SANCHEZ, LLC 3850 N. Causeway Blvd., Suite 1500 Metairie, LA 70002
-AND-
Troy R. Keller TROY R. KELLER, APLC 917 N. Causeway Blvd Metairie, LA 70001
COUNSEL FOR PLAINTIFF/APPELLEE
Charles J. Duhe, Jr. Michael M. Thompson Lacey Sanchez Rispone TAYLOR, WELLONS, POLITZ & DUHE, APLC 4041 Essen Lane, Suite 500 Baton Rouge, LA 70809
COUNSEL FOR DEFENDANTS/APPELLANTS
AFFIRMED
FEBRUARY 24, 2021 EAL
TFL The Appellant, Waste Management of Louisiana, LLC d/b/a Waste
TGC Management New Orleans Hauling (“WM”), seeks review of the January 30,
2020 judgment of the district court, granting the Motion for Constructive
Contempt of the Appellee, Jeremiah Thomas, and awarding him $1,500 in
attorney’s fees plus costs. Based upon our review of the facts and applicable law,
we affirm the district court’s judgment, finding no abuse of its vast discretion.
Facts and Procedural History
This appeal stems from a personal injury lawsuit filed by Mr. Thomas in
Plaquemines Parish. Mr. Thomas was working at a landfill in Belle Chasse on
April 2015, when the door of a WM container he was standing near snapped open,
striking him on the back of his head. The WM container was on a vehicle being
operated by Wardell Allen. Mr. Thomas was knocked unconscious upon impact.
Mr. Thomas alleges that as a result of the accident he suffered a traumatic brain
injury (TBI) and other severe injuries that required him to undergo back surgery
and receive treatment for consistent neck pain, in addition to other treatments. In
1 2016, he filed a lawsuit against Mr. Allen and WM, seeking economic and non-
economic damages.
The instant appeal involves a three-year discovery dispute over WM’s
failure to produce certified copies of insurance policies requested by Mr. Thomas.
This dispute began in August 2017, when Mr. Thomas propounded a Request for
Production of Documents upon WM, which included the following request for
insurance policies:
Please produce a certified copy of any and all insurance policies, including but not limited to:
A. Liability insurance policy(ies); B. Excess insurance policy(ies); C. Commercial general liability (CGL) insurance policy(ies); D. Protection and indemnity insurance policy(ies); E. Umbrella policy(ies); and F. Any other applicable insurance policy(ies) providing coverage to Waste Management for the claims made in this action.
WM failed to initially respond and again failed to respond after receiving a
two week extension. Mr. Thomas then moved to compel WM to comply. The
district court granted the motion to compel (“First Judgment”) at a December 4,
2017 hearing, and ordered WM to respond within 30 days. WM did not make an
appearance at the hearing.
Thereafter, WM again failed to provide Mr. Thomas with discovery
responses, causing Mr. Thomas to file a second discovery motion, “Motion for
Constructive Contempt and to Compel Responses to Discovery.” WM then
responded, producing a $2,000,000 policy, which it claimed was its primary
2 policy. It also submitted a supplemental response to the discovery, but did not
produce another policy, explaining:
The previously produced policy provides more than enough coverage for the plaintiff’s claims in this case.
Nevertheless, the district court granted the second motion in part and with
respect to insurance, the court ordered WM to produce all relevant insurance
policies in an August 30, 2018 judgment, referred to herein as the Second
Judgment.1
WM then submitted an additional $9,000,000 policy, totaling proof of $11,
000,000 in coverage, rationalizing that the value of Mr. Thomas’ claim was less
than this amount. WM’s response, however, spurred Mr. Thomas to file a third
motion— Motion for Constructive Contempt— averring that WM purposefully
disregarded the Second Judgment issued by the district court. At a January 13,
2020 hearing, the district court granted the motion (hereinafter the “Contempt
Judgment”) with regard to the outstanding insurance discovery and ordered that all
policies be produced within 30 days. The court further imposed sanctions against
WM, which was ordered to pay $1,500 in attorney’s fees plus costs to Mr. Thomas.
This timely suspensive appeal followed. WM raises two assignments of
error:
1 The district court’s Second Judgment states in pertinent part:
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that defendants, Waste Management of Louisiana, LLC, d/b/a New Orleans Hauling, and Wardell Allen, shall respond to plaintiff’s discovery requests, including:
1) Providing all applicable insurance policies relevant to the event that gave rise to this lawsuit, in response to Request for Production No. 6 . . .
3 1. The district court committed manifest error when it changed the Second Judgment, and, consequently, found WM in contempt of court despite its compliance with the court’s First Judgment; and
2. The district court misinterpreted La. Code Civ. Proc. art. 1423, resulting in the Contempt Judgment, wherein WM was ordered to produce its insurance tower or layers of insurance. Moreover, the court failed to conduct a balancing test of Mr. Thomas’ showing of the potential judgment value against the relevancy and hardship of producing insurance policies that “may be liable to satisfy part or all of [that] judgment” as required by law.
Standard of Review
Trial courts are vested with broad discretion when ruling upon discovery
matters. Sercovich v. Sercovich, 11-1780, p. 5 (La.App. 4 Cir. 6/13/12), 96 So.3d
600, 603. Appellate courts should not disturb such rulings absent a clear abuse of
discretion. Id. “An appellate court must balance the information sought in light of
the factual issues involved and the hardships that would be caused by the court's
order when determining whether the trial court erred in ruling on a discovery
order.” Id. (internal citation omitted).
Moreover, appellate courts also review a district court’s finding of contempt
for an abuse of discretion. Laborde v. Laborde, 19-0634, p. 4 (La. App. 4 Cir.
5/6/20), 299 So. 3d 657, 660, writ denied, 20-0686 (La. 9/29/20), 301 So. 3d 1193
(citations omitted). In Germain v. Germain, 19-0067, 19-0068, 19-0069, pp. 3-4
(La. App. 4 Cir. 9/11/19), 282 So.3d 282, 285, we defined contempt and further
explained the vast discretion afforded to the district court in matters where a party
disregards court orders:
Contempt of court is defined as “any act or omission tending to obstruct or interfere with the orderly administration of justice, or to impair the dignity of the court or respect for its authority.” La. C.C.P. art. 221.
4 Pursuant to La. C.C.P. art. 224(2), the “[w]ilful disobedience of any lawful judgment, order, mandate, writ, or process of the court” constitutes constructive contempt of court. In order for the trial court to find the accused in constructive contempt of court, the trial court must find that the accused “violated an order of the court ‘intentionally, purposely, and without justifiable excuse.’” Knapp, 16-0979, p. 13, 216 So.3d at 140. (quoting Burst v. Schmolke, 10-1036, p. 6 (La. App. 4 Cir. 4/6/11), 62 So.3d 829, 833). “The trial court is vested with great discretion in determining whether a party should be held in contempt for disobeying a court order and the court's decision should be reversed only when the appellate court discerns an abuse of that discretion.” Id., 16-0979, p. 13-14, 216 So.3d at 140.
Thus, in the instant matter, we apply the abuse of discretion standard to our
review of the Contempt Judgment.
Consistency of the District Court Judgments
The first assignment of error raised by WM is that the district court
manifestly erred by unreasonably changing its judgments, and ultimately requiring
WM to produce all of its policies to Mr. Thomas. WM avers that the district court
twice changed its judgment, which resulted in WM producing more of its policies
each time. The district court ultimately mandated WM share all of its policies
despite the fact that WM had already produced policies that would cover an
$11,000,000 claim, which WM avers exceeds the value of the instant claim. We
find this assignment of error to be without merit because the district court thrice
ordered the production of all relevant insurance policies.
WM summarizes the allegedly ever-changing discovery rulings of the
district court as follows:
First Judgment: “fully respond to the Plaintiff’s discovery”, which in this instance was Request for Production No. 6.
5 Second Judgment: ordering WM to “provide all applicable insurance policies relevant to the event that gave rise to this lawsuit.”
Hearing on the Motion for Constructive Contempt: The district court stated “I meant every policy that could possibly provide coverage.”
WM characterizes the wording of the judgments and the district court’s
rulings as being ever-changing and having unreasonable terms. Terms such as
“fully respond,” “provide all applicable policies” and submit “every policy that
could possibly provide coverage,” however, instead evidence that the district court
consistently ordered the production of all relevant insurance policies.
The record reveals that there was no substantive change in the judgments
issued by the Court. As WM did not make an appearance at the initial motion to
compel hearing, it should have sought clarification of the First and Second
Judgment, instead of persistently failing to comply and later doling out the policies
it opted to disclose.
Indeed, at the January 2020 contempt hearing, the district court explained
that it was ordering the production of the same insurance policies it had originally
ordered, which is why it awarded attorney’s fees for all the previous rules:
. . . I'm going to order the production, once again, on these documents, failure of which to produce could result in dismissal of any argument you might have at trial. And then I'm also ordering attorney fees and court costs for the -- filing the Rule today. Not only today's Rule, but the previous Rules on the same issue. [Emphasis added].
The district court’s explanation belies WM’s assertion that there was any
change in what was ordered to be produced.
In consideration of the foregoing, we further find WM’s assertion that it
would have been in compliance with the First and Second Judgments had the
6 Contempt Judgment not been issued is also erroneous because WM’s repeated
failure to comply led to the rendering of the Contempt Judgment. This assignment
of error is without merit.
We address in the following assignment of error the underlying issue of
whether the district court had the authority to order production of all applicable
insurance policies.
Application of La. Code Civ. Proc. art. 1423
WM asserts in its second assignment of error that the district court’s
Contempt Judgment resulted in a misapplication of La. Code Civ. Proc. art. 1423,
and the court erroneously required WM to produce all of its policies. WM
maintains that under the clear wording of article 1423 and Louisiana jurisprudence,
a balancing test of factual issues and hardships is required when ordering the
production of discovery. If such a test were applied, WM maintains it would not
be required to produce all of its applicable policies. WM further asserts that it is an
absurd consequence to make a billion-dollar company produce all of its policies in
a personal injury lawsuit worth only a few million dollars.
Regarding article 1423, WM avers that by the time the district court issued
the Contempt Judgment, it had misapplied the plain meaning of the article. WM
contends that article 1423 allows for the partial discovery of insurance policies
relevant to a proceeding, not necessarily all policies because the plain language of
the statute does not support an interpretation of producing all policies. It avers that
there may be several policies under which there is no liability and those must be
safeguarded from production.
An interpretation of article 1423 requiring production of all of the relevant
policies would also lead to absurd consequences, according to WM, especially
7 because Mr. Thomas has not demonstrated that the value of his claims exceeds
$11,000,000. WM alleges that the production of extraneous policies and imposing
sanctions is contrary to Louisiana law.
Lastly, WM avers the district court is responsible for safeguarding the
discovery process. Consequently, the court should have conducted a balancing test
of Mr. Thomas’s potential judgment value against the burden of producing policies
that may be liable to satisfy all or part of a judgment based upon plain wording of
the article. WM asserts that Sercovich, supra, calls for a balancing test of factual
issues and hardships a discovery order may cause. “An appellate court must
balance the information sought in light of the factual issues involved and the
hardships that would be caused by the court's order when determining whether the
trial court erred in ruling on a discovery order.” Sercovich, 11-1780, p. 5, 96 So. 3d
at 603 (quoting Wollerson v. Wollerson, 29,183, p. 2 (La.App. 2 Cir. 1/22/97), 687
So.2d 663, 665).2
In the matter sub judice, WM maintains that because a balancing test was
not performed it should not have to produce all of its relevant policies. Production
of all policies, it argues, is an absurd consequence, especially because as a billion-
dollar company it has multiple layers of insurance that may not come into play
based on the value of Mr. Thomas’ claims.
2 In Sercovich, a wife sought the production of certain business and tax records for business entities that her husband sold to his sons from a prior marriage, in order to calculate final periodic spousal support. The district court denied a motion to quash filed on behalf of the business entities to stop the production of the requested documents and denied a motion for new trial. Sercovich, 11-1780, pp. 2-4, 96 So. 3d at 601-02.
On appeal, this Court recognized that the wife’s right to such records under Louisiana’s “broadly and liberally construed” discovery statutes was not unlimited because her request involved the production of financial records of a confidential and sensitive nature. Therefore, the matter was remanded to the district court to conduct an in camera review of the requested records to determine which records should be produced. Id., 11-1780, pp. 7-8, 96 So. 3d at 604.
8 La. Code Civ. Proc. art. 1423, entitled Scope of Discovery; insurance
agreements, provides:
A party may obtain discovery of the existence and contents of any insurance agreement under which any person carrying on an insurance business may be liable to satisfy part or all of a judgment which may be entered in the action or to indemnify or reimburse for payments made to satisfy the judgment. [Emphasis added].
The plain wording of the article indicates that the existence and contents of
any policy under which a party may be liable for all or part of a judgment is
discoverable. Additionally, the article contains no requirement that a party seeking
the existence and contents of an insurance policy must first establish the value of
their claim. Thus, as explained above, the district court’s numerous judgments
ordering the production of all policies germane to this claim is consistent with the
plain meaning of this article. “When a law is clear and unambiguous and its
application does not lead to absurd consequences, the law shall be applied as
written and no further interpretation may be made in search of the intent of the
legislature.” La. Civ. Code art. 9. The clear and unambiguous meaning of a law
cannot be disregarded. See La. Rev. Stat. 1:4.
The transcript of the January 13, 2020 hearing evidences that the district
court, Judge Kevin Conner, explained to counsel for WM that the production of all
applicable policies to the instant matter is what had always been ordered and all
policies were discoverable because the value of Mr. Thomas’s claim cannot be
arbitrarily determined by WM or the court itself:
I'm interested in insurance policies written on behalf of your -- your client. You see, the problem is, people, almost all the case law says he's entitled to get the policies of insurance. It's not up to you or me to dictate to him what is acceptable in terms of the amount
9 of coverage and the amount of damages. That will be shown at trial. My problem is -- And I understand where you're coming from. If Mr. Chanez was standing up here and say, "Okay. It's a 5 million dollar claim and you guys have 10 million in insurance, there's a stipulation in the record that no arguments will be made for blah-blah- blah-blah-blah in terms of any type of exception or exclusion." I believe he might be willing to take the deal.
But I think what he's telling you is at this time he's not sure what the value of his claim is. He's not willing to stipulate to that.
I'm stuck as a Judge, and I think the case law is in his favor in terms of producing these policies. So I've already ordered them once, you haven't done it. . .
At the conclusion of the hearing, counsel for WM admitted he had an issue
with the prior orders of and sought clarification:
Mr. Thompson: Just, again, because 1 did have a problem and it's on me, the Court's Order is all applicable policies that could conceivably provide coverage for this.
The Court: In every case I've dealt with these twenty- something years of private practice, when I asked for a company to give me their policies I meant every one that could possibly provide coverage.
Mr. Thompson: Okay
The Court: Not self-insurance . . . . The ones that are written out that you have a policy on. I had ordered them previously produced and they haven't been produced. . . . [Emphasis added].
WM is correct in asserting that discovery has its limits. Discovery is
limited, “particularly when justice requires that a party or other person be protected
from annoyance, embarrassment, oppression, or undue burden or expense.”
Channelside Servs., LLC v. Chrysochoos Grp., Inc., 15-0064, pp. 10-11 (La. App.
4 Cir. 5/13/16), 194 So.3d 751, 757–58 (quoting Stolzle v. Safety & Systems Assur.
Consultants, Inc., 02-1197, p. 2 (La. 5/24/02), 819 So.2d 287, 289; see also La.
10 Code Civ. Proc. art. 1426). Nevertheless, insurance policies are jurisprudentially
recognized as being discoverable under article 1423 and WM does not offer any
specific legal support for its argument that the interests of justice outweigh a
party’s right to receive and review applicable insurance policies.
The Louisiana Supreme Court explained that La. Code Civ. Proc. art. 1423,
“expressly allows inquiry into the amount of insurance coverage afforded a
defendant.” Guy v. Tonglet, 379 So.2d 744, 746 (La. 1980). Noting that the article
was not enacted to permit discovery of all aspects of defendant's financial status,
the Supreme Court rationalized that insurance is not classified as an asset because
it “is maintained specifically for the purpose of protecting a defendant against
litigation; the insurance company ordinarily defends the litigation; and disclosure
of the existence of liability insurance does not involve a significant invasion of
privacy.” Id. Thus, while the Supreme Court anticipates some minor invasion of
privacy when insurance policies are produced, it recognizes that this information is
nevertheless discoverable.
Lastly, in determining sanctions for a party’s failure to comply with
discovery requests, a district court considers the prejudice to the other party and
the willfulness of the noncomplying party. Richardson v. Amos, 42,948, p. 4
(La.App. 2 Cir. 3/19/08), 978 So.2d 1184, 1187 (internal citations omitted). WM
has blatantly failed to comply over the past three years. It opted initially not to
respond to the propounded discovery and thereafter, to only produce policies that
were consistent with its valuation of Mr. Thomas’ claim.
Furthermore, regarding prejudice to Mr. Thomas, we note “[t]he Louisiana
Supreme Court has delineated the ‘basic objectives’ of the Louisiana discovery
process as follows: (1) to afford all parties a fair opportunity to obtain facts
11 pertinent to litigation; (2) to discover the true facts and compel disclosure of these
facts wherever they may be found; (3) to assist litigants in preparing their cases for
trial; (4) to narrow and clarify the basic issues between the parties, and; (5) to
facilitate and expedite the legal process by encouraging settlement or abandonment
of less than meritorious claims.” Sercovich, 11-1780, p. 5, 96 So.3d at 603 (citing
Hodges v. Southern Farm Bureau Cas. Ins. Co., 433 So.2d 125, 129 (La.1983)
(citations omitted)). In the instant matter, WM’s conduct has obstructed the
discovery process for Mr. Thomas over a three- year period because he has not
been afforded a fair opportunity to obtain facts pertinent to litigation; has been
prevented from discovering true facts; and has been hindered in preparing his case
for trial and delayed in potentially settling his claims. Specifically, WM’s failure to
disclose all relevant insurers, who are potential joint and solidary obligors under
Louisiana’s Direct Action statute, prevented Mr. Thomas from suing additional
defendants and possibly settling this matter. See La. Rev. Stat. 22:1269 (B)(1).3
Considering WM’s serial noncompliance with the district court’s judgments,
the deleterious effect failing to comply with article 1423 has had and will have
upon Mr. Thomas, and the vast discretion of the district court, we find that there
has been no showing that the district court abused its discretion in granting the
3 Mr. Thomas notes that defendants in Louisiana have been sanctioned for withholding the production of insurance policies during discovery. For instance, in Peterson v. Gibraltar Sav. & Loan, Inc., 98-1601, p. 3 (La. 9/3/99), 751 So.2d 820, 822, the Louisiana Supreme Court, on rehearing, remanded a matter to the district court for a contradictory hearing to determine what, if any, sanctions were appropriate for a group of defendants and their attorneys who failed to disclose a $10,000,000 excess policy during discovery. Additionally, in Dufrene v. Gauthreau Family LLC, 09-153, pp. 5-6 (La. App. 5 Cir. 11/10/09), 28 So.3d 465, 469, the Fifth Circuit upheld sanctions against an insurer for failing to disclose additional applicable policies until the end of trial. The Dufrene court reasoned an award of sanctions against an insurer for failure to deal fairly with claimants did not bar an award of sanctions against insurer for its litigation conduct. Id.
12 Motion for Constructive Contempt, and ordering the production of all applicable
DECREE
For the foregoing reasons, the January 30, 2020 judgment of the district
court, granting Jeremiah Thomas’ Motion for Constructive Contempt against
Waste Management of Louisiana, LLC d/b/a Waste Management New Orleans
Hauling, and awarding Mr. Thomas $1,500 in attorney’s fees plus costs, is
affirmed.