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Anna Fair v. Royal & Sun Alliance and Arrowpoint Capital Corp.

January 11, 2012

ANNA FAIR,
PLAINTIFFS,
v.
ROYAL & SUN ALLIANCE AND ARROWPOINT CAPITAL CORP., AS SUCCESSOR IN INTEREST TO ROYAL & SUN ALLIANCE, NASH FINCH COMPANY, AND SEDGWICK CMS, DEFENDANTS.



The opinion of the court was delivered by: Veronica L. Duffy United States Magistrate Judge

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTIONS TO QUASH AND FOR PROTECTIVE ORDER [DOCKET NOS. 48 and 70]

INTRODUCTION

This matter is before the court on plaintiff Anna Fair's complaint alleging bad faith denial of her worker's compensation insurance claim. See Docket No. 1. Jurisdiction is premised on diverse citizenship of the parties and an amount in controversy in excess of $75,000 pursuant to 28 U.S.C. § 1332.

Ms. Fair served defendants Nash Finch Company and Sedgwick CMS with a notice of deposition and two subpoenas duces tecum pursuant to Fed. R. Civ. P. 30(b)(6). These two defendants then moved the court for an order quashing that notice of deposition, quashing one of the subpoenas duces tecum and for a protection order. See Docket Nos. 48, 70.*fn1 Ms. Fair opposes these motions. The district court, the Honorable Jeffrey L. Viken, referred defendants' motions to this magistrate judge for decision pursuant to 28 U.S.C. § 636(b)(1)(A).

FACTS

The following are facts relevant to the instant motion. Plaintiff Anna Fair was employed by defendant Nash Finch Company ("Nash Finch"). While so employed on July 8, 2003, she suffered a work-related injury to her left ankle, resulting in a recurrence of a stasis ulcer. At the time of the injury, Nash Finch had procured worker's compensation insurance through an insurance policy sold to them by Royal & Sun Alliance. Sedgwick CMS ("Sedgwick") administered worker's compensation claims for Royal & Sun Alliance. Ms. Fair received worker's compensation benefits from Royal & Sun Alliance for her ankle injury prior to August, 2009.*fn2

In August, 2009, Ms. Fair required additional medical treatment for her work-related ankle injury. Defendants did not agree to pay for the care and Ms. Fair's medial care provider would not provide the treatment until payment for the care was verified. Accordingly, Ms. Fair arranged for her treatment to be covered by Medicare so that she could receive the treatment she needed. Ms. Fair was treated in September, 2009. Medicare paid over $3,000 on Ms. Fair's medical expenses relating to her ankle for this 2009 treatment.

Ms. Fair was herself responsible for just under $500 of these medical expenses.

Ms. Fair's attorney pursued payment from defendants for these medical expenses. Defendants did not make the payment. Ms. Fair alleges that defendants' decision not to pay was a deliberate bad faith denial of her worker's compensation claim. Defendants allege that the failure to pay the claim was due to inadvertence rather than design.

Ms. Fair's attorney filed a petition on March 15, 2010, before the South Dakota Department of Labor in an attempt to force defendants to pay Ms. Fair's worker's compensation claim for the September, 2009, medical treatment. Defendants answered the petition by stating that they had already paid all bills on Ms. Fair's claim and asking that Ms. Fair's petition be dismissed.

In April 2010, Ms. Fair's medical care provider turned Ms. Fair's account over to a debt collection agency, which began attempting to collect the approximately $500 from Ms. Fair that was still owed on her September, 2009, treatment bill.

Approximately three months after Ms. Fair's petition before the Department of Labor was filed, defendants paid in their entirety the medical expenses for Ms. Fair's September, 2009, treatment--resulting in a reimbursement of Medicare and payment of the additional $500 balance. Ms. Fair filed her complaint in this matter on January 24, 2011.

Since the lawsuit was initiated, the parties have engaged in some discovery. The deposition of Ms. Fair has been taken. Depositions of Cindy Weingart, Dave Oertli, Patty Nylin, Beth Iacono, and Deborragh Woods were taken. And written discovery requests have been served and, for the most part, responded to.

On December 21, 2011, Ms. Fair's counsel served on defendants a deposition notice pursuant to Fed. R. Civ. P. 30(b)(6) and a subpoena duces tecum. The deposition notice listed 18 separate and specific inquiries it wished Sedgwick to provide representatives to answer questions regarding, and 13 separate and specific inquires it wished Nash Finch to provide representatives to answer questions regarding. The 13 topics posed for Nash Finch are identical to the first 13 topics posed for Sedgwick. The deposition was noticed as a video deposition and set a date of January 20, 2012, for the deposition to take place.

Ms. Fair simultaneously served Sedgwick and Nash Finch with a subpoena duces tecum for three specific documents or sets of documents, to be produced to Ms. Fair's attorney one week before the Rule 30(b)(6) deposition. Sedgwick and Nash Finch also object to one of these subpoenas duces tecum.

Sedgwick and Nash Finch now seek to quash the notice of deposition, quash one subpoena duces tecum, and they seek a protection order. Ms. Fair resists the motions.

DISCUSSION

A. Good Faith Certification

Both the Federal Rules of Civil Procedure and this district's local rules of procedure require that parties meet and confer in an attempt to resolve discovery disputes before filing discovery motions. See Fed. R. Civ. P. 26(c)(1); DSD LR 37.1. A certification must be part of any discovery motion and the certification must show that a good-faith effort was made to resolve disputes before filing the motion. Id.

Defendants satisfied their duty to meet and confer prior to filing the second motion, Docket No. 70. As to the first motion to quash and for a protective order, Docket No. 48, no such attempt was even made by defendants before filing the motion. Defendants state that "due to the holidays, the parties have not had an opportunity to satisfy the obligations to meet and confer." See Defendants' brief at Docket No. 49, page 2.

Plaintiff's counsel represents that he was in his office working every business day over the holidays and even on some non-business days. He was never contacted by defendants' counsel regarding the subject of this discovery motion.

Had defendants attempted to contact plaintiff to resolve the discovery issues and had defendants been unable to get in touch with plaintiff, the failure to abide by Rule 26(c)(1) and Local Rule 37.1 might be excused. But the meet-and-confer requirement is mandatory--both rules use the word "shall." And defendants made no effort to fulfill this requirement before filing the instant motion. If defendants' counsel were in the office long enough to draft and file this motion, they were in the office long enough to place a telephone call or send an e-mail to plaintiff's counsel. The court finds that defendants have not satisfied their obligation under Fed. R. Civ. P. 26(c)(1) or DSD LR 37.1 before filing this motion and that the failure to do so provides an independent ground for the denial of the motion.

However, defense counsel did contact plaintiff's counsel after filing the motion and represent that they were unable to resolve their differences. Because the merits of defendants' objections to plaintiff's discovery are likely to arise again, and because the meet-and-confer was eventually held (albeit after the motion was filed) the court addresses the merits of the motion.

B. Scope of Discovery in a Civil Case

Under Fed. R. Civ. P. 30(b)(6), a party may designate a public or private corporation as the deponent and list with reasonable particularity the matters the party wishes to examine the corporation on. The corporation must then designate one or more persons to testify on behalf of the corporation. Defendants Sedgwick CMS and Nash Finch do not take issue with the nature of plaintiff's Rule 30(b)(6) notice. They do not argue that Ms. Fair has failed to state with reasonable particularity the matters on which she wishes to inquire. Rather, defendants' argument against the discovery is that the discovery is not relevant and poses an undue burden.

The scope of discovery is governed by Fed. R. Civ. P. 26. The scope described by that rule is broad:

Unless otherwise limited by court order, the scope of discovery is as follows: Parties may obtain discovery regarding any non-privileged matter that is relevant to any party's claim or defense--including the existence, description, nature, custody, condition, and location of any documents or other tangible things and the identity and location of persons who know of any discoverable matter. For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence. All discovery is subject to the limitations imposed by Rule 26(b)(2)(C).

See Fed. R. Civ. P. 26(b)(1).

This broad scope of discovery under subsection (b)(1) is limited by subsection (b)(2)(C). That subsection provides that:

On motion or on its own, the court must limit the frequency or extent of discovery otherwise allowed by these rules or by local rule if it determines that:

(i) the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive;

(ii) the party seeking discovery has had ample opportunity to obtain the information by discovery in the action; or

(iii) the burden or expense of the proposed discovery outweighs its likely benefit, considering the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stake in the action, ...


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