WILLIAM A. LEMONS, JR., M.D., Plaintiff, v. PRINCIPAL LIFE INSURANCE COMPANY, Defendant Case No.: 2:18-CV-1040-CLM United States District Court, N.D. Alabama, Southern Division Filed March 09, 2020 Ragsdale, Barry A., Special Master SECOND REPORT AND RECOMMENDATION OF SPECIAL MASTER *1 Pursuant to the Court's Order of May 17, 2019 (Doc. 43) and Fed.R.Civ.P. 53(a)(1)(c), the undersigned was appointed by this Court to meet with the parties, examine and review the pending discovery disputes in this matter, and to submit a report regarding a recommended resolution of those disputes. In its Order of August 19, 2019 (Doc. 55), this Court extended the undersigned's authority to address “all outstanding discovery issues,” including Plaintiff's Motion to Compel and Overrule Discovery Objections (Doc. 46). Based on a review of the filings and discussions with counsel, there are currently a number matters in dispute involving Plaintiff's previous motions to compel as well additional or supplemental discovery that Plaintiff seeks from Defendant. APPLICABLE STANDARD Federal Rule of Civil Procedure 26(b)(1) provides in part: 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 discovery in resolving the issues, and whether the burden of expense of the proposed discovery outweighs its likely benefit. Furthermore, “[i]nformation within this scope of discovery need not be admissible in evidence to be discoverable.” Fed. R. Civ. P. 26(b)(1). Proportionality requires counsel and the court to consider whether relevant information is discoverable in view of the needs of the case. See Graham & Co., LLC v. Liberty Mut. Fire Ins. Co., No. 2:14-cv-2148-JHH, 2016 WL 1319697, at *3 (N.D. Ala. April 5, 2016); Walker v. Life Ins. Co. of N. Am., No. 5:16-cv-00506-HNJ, ECF No. 73, at p. 2 (N.D. Ala. June 7, 2018). Whether a particular discovery request is “proportional to the needs” of the case involves consideration of several non-exclusive factors: “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.” Fed. R. Civ. P. 26(b)(1). “Any application of the proportionality factors must start with the actual claims and defenses in the case, and a consideration of how and to what degree the requested discovery bears on those claims and defenses.” Graham, 2016 WL 1319697 at *3 (citing Witt v. GC Servs. Ltd. P'ship, 307 F.R.D. 554, 569 (D. Colo. 2014)). The court must “consider these and all the other factors in reaching a case-specific determination of the appropriate scope of discovery.” Rule 26 2015 advisory committee note. DISCUSSION Several of Plaintiff's outstanding discovery requests involve what has been called “discovery on discovery” in which Plaintiff seeks to challenge the sufficiency and thoroughness of Defendant's production of documents and other evidence. These requests reflect Plaintiff's continuing distrust of the completeness of Defendant's responses. A number of Plaintiff's requests seek confirmation of previous representations by counsel regarding compliance with Defendant's obligations under the discovery rules. To the extent that the undersigned has recommended that Plaintiff's requests be denied based on the affirmative representations of counsel, Plaintiff remains free to produce evidence challenging the veracity of those representations, but, in the absence of such evidence, the undersigned will accept and memorialize the statements of counsel. I. Plaintiff's Motion to Overrule Discovery Objections and Motion to Compel. *2 The undersigned has reviewed and considered Plaintiff's Motion to Overrule Discovery Objections and Motion to Compel Responses to Second and Third Set of Discovery (Doc. 46), Defendant's Response in Opposition (Doc. 49), and Plaintiff's Reply (Doc. 51), as well as correspondence from counsel.[1] In addition, the undersigned conducted a teleconference with counsel on August 19, 2019 to hear arguments regarding Plaintiff's motion to compel. The remaining discovery disputes identified in Plaintiff's motion to compel involve Plaintiff's Requests for Production (“RFP”) 26, 27, 30, 31, and 36-39, as well as Interrogatories 22-24, and Requests for Admission (“RFA”) 12-13.[2] A. RFPs 26-27. RFP 26 asks Defendant to “[p]roduce all advertising materials and other explanatory materials concerning the regular occupation rider for the Policy from 1991 to 1999.” RFP 27 asks Defendant to “[p]roduce all advertising materials and other explanatory materials concerning the regular occupation rider for policies currently sold by Principal.” Plaintiff contends that the requested advertising materials are relevant to whether Defendant acted in bad faith. Defendant argues that it has previously produced advertising material relevant to Plaintiff's policy and that it has only objected to producing documents involving other policies. Plaintiff has failed to establish a need for advertising materials unrelated to the policy sold to Plaintiff. The undersigned recommends that Plaintiff's motion to compel Defendant to respond to RFPs 26-27 be DENIED. B. RFPs 30-31. RFP 30 asks Defendant to “[p]roduce all materials or documents relating to Dr. Lemons or his claim that are retrieved from Outlook (and any other email or employee messaging systems) using the following search terms: 1) ‘7471393’, 2) ‘1018734’, and 3) ‘Lemons’.” RFP 31 asks Defendant to “[p]roduce all materials or documents relating to Dr. Lemons or his claim that are retrieved from FINEOS or EINOS (or any other claim repositories or databases) using the following search terms: 1) ‘7471393’, 2) ‘1018734’, and 3) ‘Lemons’.” Plaintiff argues that these requests are an attempt “to ensure that all materials and communications pertaining to Dr. Lemons' claims decisions have been produced.” (Doc. 46 at 8). Defendant's counsel has affirmatively represented both to this Court and to the undersigned that all such claims-related documents have been produced to Plaintiff. Based upon that representation, the undersigned recommends that Plaintiff's motion to compel Defendant to respond to RFPs 30-31 be DENIED. C. RFPs 36-39. RFP 36 asks Defendant to “produce all instructions, manuals, policies, or other training or guidance materials regarding interpretation and application of the riders attached to Plaintiff's policy ...” RFP 37 asks Defendant to “[p]roduce a sample copy along with sample versions of the 4 riders [identified in RFP 36] for each of the following: 1) the HH 641 Series policy in force in October 2015 (or whatever the latest date the HH 641 Series was offered), 2) the last version of HH 641 Series Policy offered in Alabama, 3) the HH750 series policy current[ly] in force for 5A professionals in Alabama, and 4) the first and 5) last versions of the 700 series policy offered for 5A professionals in Alabama.” RFP 38 asks Defendant to “[p]roduce all documents, memoranda, or other materials explaining why and what led to Principal's decision to discontinue the 641 series policy as of May 2000 in all states besides California. Finally, RFP 39 asks Defendant to “[p]roduce a copy of any actuarial memos and loss experience ratios pertaining to the 641 Series Policy from 1990 to May 2000.” *3 Plaintiff contends that he needs these requested documents in order to demonstrate that previous versions of the identified riders contained different or additional language than the rider sold to Plaintiff in an effort to establish that the subject rider is ambiguous or that Defendant's interpretation of the rider has changed over time. Defendant objects to these requests on various grounds while asserting that it has produced all responsive documents related to the Policy at issue. The undersigned does not believe that materials and sample policies related to insurance policies and riders different from that at issue in Plaintiff's complaint will aid in the analysis of whether the subject rider is ambiguous or whether the denial of Plaintiff's claim was justified. The undersigned also believes that the production of these additional documents is not proportional to the needs of this case and recommends that Plaintiff's motion to compel Defendant to respond to RFPs 36-39 be DENIED. D. Interrogatories 22-23. Interrogatory 22 asks Defendant to “[i]dentify all instances where Principal or any of its agents informed Dr. Lemons that he could have more than one regular occupation under the Policy prior to his claim being filed.” Interrogatory 23 asks Defendant to “[i]dentify all instances where Principal or any of its agents informed Dr. Lemons that he must be disabled from all regular occupations under the Policy to collect benefits under the Regular Occupation Rider.” According to Plaintiff, Defendant has previously acknowledged that the only instances in which Plaintiff was informed about the referenced facts were the issuance of the Policy and the denial of Plaintiff's claim. Based on this acknowledgement, the undersigned recommends that Plaintiff's motion to compel Defendant to respond to Interrogatories 22-23 be DENIED. E. Interrogatory 24. Interrogatory 24 asks Defendant to “[s]tate the amount of revenue Principal has derived from 641 Policies in the State of Alabama to date.” Plaintiff contends that the requested revenue information is relevant to a determination of damages. The Alabama authority cited by Plaintiff relates to the factors considered in evaluating post-judgment motions regarding an award of punitive damages. The requested information is not relevant to the threshold question of whether Defendant acted in bad faith in denying Plaintiff's claim. The undersigned recommends that Plaintiff's motion to compel defendant to respond to Interrogatory 24 be DENIED, with leave to seek such such information in post-judgment discovery if needed. F. RFAs 12-13. RFA 12 asks Defendant to admit that it “used an old version of FINEOS during the pendency of Plaintiff's claim.” RFA 13 asks Defendant to admit that “[t]he version of FINEOS being used by Principal during the pendency of Plaintiff's claim had no predictive modeling, claims analytics, or predictive metrics capabilities.” Plaintiff argues that Defendant should be compelled to respond to these requests in order to confirm Defendant's previous responses and statements that it used no predictive modeling or claims analytics in connection with Plaintiff's claim. Defendant has repeated and reinforced those statements in responding to Plaintiff's motion to compel and the undersigned takes Defendant's counsel at their word. The undersigned recommends that Plaintiff's motion to compel Defendant to respond to RFAs 12-13 be DENIED. II. Plaintiff's Additional Discovery Requests. In addition to the issues and disputes raised by Plaintiff's Motion to Overrule Discovery Objections and Motion to Compel (Doc. 46), Plaintiff has raised a number of additional discovery matters following the Court's Scheduling Conference that require the undersigned's consideration. Those discovery disputes have been addressed by the parties in a series of letter briefs, which the undersigned has read and considered. These remaining disputes include the following: A. The Reinsurance Agreement. Plaintiff seeks production of a reinsurance agreement with Swiss Re, the existence of which Plaintiff claims was first disclosed during the recent depositions. Plaintiff contends that the reinsurance agreement is an “insurance agreement” that must be disclosed under Rule 26(a)(1)(A)(iv). Defendant contends that “reinsurance agreements are not technically insurance agreements.” Unfortunately for Defendant it appears that most courts disagree with that contention and require the disclosure and production of reinsurance agreements See, e.g., Certain Underwriters at Lloyd's v. National Railroad Passenger Corporation, No. 14-CV-4717(FB), 2016 WL 2858815, at *15 (E.D.N.Y., May 16, 2016) (“Most federal courts across the country that have examined this issue, including at least one within this district, have determined that the reference in Rule 26(a)(1)(A)(iv) to ‘any insurance agreement’ includes reinsurance agreements.”); Hartman v. American Red Cross, No. 09-1302, 2010 WL 1882002, at *2 (C.D. Ill., May 11, 2010) (“The majority of District Courts to have considered the question agree that reinsurance agreements are discoverable.”). *4 The undersigned recommends that Plaintiff's request that Defendant produce any reinsurance agreements, including the one with Swiss Re, be GRANTED. B. Documents Describing the Policies' Series Terms. Plaintiff requests that Defendant be required to produce additional portions of the Claims Manual and the “underwriting manual for the 600 Series policies.” As regards the Claims Manual, Plaintiff complains about the thoroughness of Defendant's production while Defendant represents that it has produced all sections of the Claims Manual requested by Plaintiff. The dispute centers on one of seven sections referenced in the undersigned's previous Report & Recommendation. Having reviewed the parties' submissions, including deposition testimony and other documents, the undersigned agrees with Defendant that it has complied with previous orders and directives on this issue and recommends that Plaintiff's request regarding the production of further sections of the Claims Manual be DENIED. As regards the underwriting manual for the 600 Series policies, Defendant does not object to the production of the manual as undiscoverable or burdensome to produce, but instead contends that Plaintiff has not propounded a discovery request specific enough to require the production of the underwriting manual. The undersigned disagrees and believes that the underwriting manual for the 600 Series policies should be produced. As a result, the undersigned recommends that Plaintiff's request that Defendant produce any underwriting manual for the referenced 600 Series of policies be GRANTED. C. Doug Hanselman's Job Description and Evaluations. Plaintiff requests that Defendant produce all job descriptions and evaluations of Doug Hanselman, Defendant's Senior Claims Account Manager. The parties dispute the role that Mr. Hanselman was working in when he wrote a letter dated January 23, 2017 regarding Plaintiff's claim, but the Defendant acknowledges that he was involved in the handling of Plaintiff's claim. Defendant has produced the job description for a Senior DI Claims Analyst, the position that Defendant contends Mr. Hanselman was effectively occupying when he worked on Plaintiff's claim but has declined to produce the description for Mr. Hanselman's position as Senior Claims Account Manager. Given that there is no dispute that Mr. Hanselman was a Senior Claims Account Manager during the relevant time period, the undersigned recommends that Plaintiff's request for the applicable job description for Mr. Hanselman's position be GRANTED. The Undersigned does not believe that Plaintiff has established a need for Mr. Hanselmsn's employment evaluations and recommends that Plaintiff's request for such evaluations be DENIED. D. Reserve Communications regarding Plaintiff's Claim. Plaintiff renews his request for information regarding Defendant's reserves related to Plaintiff's claim. While acknowledging that the undersigned previously recommended, and the Court adopted, the position that reserve information was beyond the scope of discovery, Plaintiff argues that the deposition testimony of Mr. Hanselman changes the equation. According to Plaintiff, while Defendant previously represented that claims analysts don't have access to reserves information, Mr. Hanselman – who signed the January 23, 2017 letter – testified in deposition that he did have access to such information. Both parties submitted excerpts from Mr. Hanselman's deposition and the undersigned has reviewed those excerpts along with the submissions of counsel. The undersigned does not believe that the deposition testimony changes the circumstances sufficiently to alter the position previously articulated in the Report & Recommendation. As a result, the undersigned recommends that Plaintiff's request for communication and other documents regarding reserves be DENIED. E. All Communications regarding Plaintiff's Claim. *5 Finally, Plaintiff contends that depositions have established that “not all communications relating to Dr. Lemons or his claim were put in his file,” and demands that Defendant produce all communication regarding this claim, no matter where it might be maintained. In particular, Plaintiff is dissatisfied with Defendant's search methods and is critical of the thoroughness of Defendant's production. Once again, Defendant represents that all portions of Plaintiff's file have been produced and that it is unaware of any documents that were overlooked or withheld. Plaintiff cannot identify any communication or other document that would establish that the Defendant's production is insufficient. The undersigned recommends that Plaintiff's request for additional communication regarding Plaintiff's claim be DENIED. Respectfully submitted, this 9th day of March, 2020. Footnotes [1] Following discussions with counsel and a supplemental production by Defendant, Plaintiff's counsel notified the undersigned by email that Plaintiff was withdrawing the motion to compel regarding Request for Production 23 and Interrogatories 17, 18, and 19. [2] Plaintiff's Motion to Compel also seeks to strike or have overruled all of Defendant's objections on the ground that they lack an adequate explanation for the objections. The undersigned finds that Defendant's objections are properly and adequately articulated and recommends that Plaintiff's motion be denied to the extent that it seeks a sweeping rejection of Defendant's objections.