TIG INSURANCE COMPANY, Plaintiff, v. WOODSBORO FARMERS COOPERATIVE and E.F. ERWIN, INC., Defendants CIVIL ACTION NO. 5:18-CV-191 United States District Court, S.D. Texas, Laredo Division Filed April 07, 2020 Kazen, John A., United States Magistrate Judge ORDER *1 Before the Court is Defendant Woodsboro Farmers Cooperative's Motion to Compel Discovery Responses. (Dkt. No. 42). Plaintiff TIG Insurance Company (“TIG”) filed a response to the Motion to Compel, which also included a Motion for Protective Order. (Dkt. No. 45). On March 20, 2020, the Court conducted a hearing on the Motions (the “March hearing”). (Min. Entry dated Mar. 20, 2020). As ordered, Defendant Woodsboro Farmers Cooperative (“Woodsboro”) and TIG have since filed supplemental briefing. (Dkt. Nos. 47, 48, 49). I. Background TIG filed this action against Woodsboro and Defendant E.F. Erwin, Inc. (“Erwin”) seeking a declaratory judgment regarding an underlying state court suit. (Dkt. No. 1). The complaint seeks a declaration that TIG owes neither a duty to defend nor a duty to indemnify Erwin in the underlying litigation. (Id. at 9). Erwin has since filed a counterclaim against TIG for declaratory judgment, seeking a declaration that TIG has a duty to indemnify in the underlying litigation. (Dkt. No. 28 at 15). Woodsboro has filed a similar counterclaim for declaratory judgment. (Dkt. No. 29 at 15). The duty to defend and duty to indemnify are the only claims at issue in this lawsuit. Woodsboro filed the pending Motion to compel TIG's responses to two requests for production, eight interrogatories, and two requests for admission. (Dkt. No. 42 at 2). During the March hearing, Woodsboro clarified that it was only seeking to compel TIG's response to the two requests for production and eight interrogatories. II. Legal Standard Federal Rule of Civil Procedure 33 governs the scope of interrogatories. Particularly, Rule 33(a) states that “an interrogatory may relate to any matter that may be inquired into under Rule 26(b).” Id. Similarly, Federal Rule of Civil Procedure 34(a)(1) allows a party to request the production of “any designated documents or electronically stored information” or “tangible things” within the scope of Rule 26. Rule 26 in turn provides, “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.” Fed. R. Civ. P. 26(b)(1). “Discovery requests are relevant when they seek admissible evidence or evidence that is reasonably calculated to lead to the discovery of admissible evidence.” Wiwa v. Royal Dutch Petroleum Co., 392 F.3d 812, 820 (5th Cir. 2004) (internal quotation marks omitted). Thus, “[t]he threshold for relevance at the discovery stage is lower than at the trial stage.” Rangel v. Gonzalez Mascorro, 274 F.R.D. 585, 590 (S.D. Tex. 2011). “Relevancy is broadly construed, and a request for discovery should be considered relevant if there is ‘any possibility’ that the information sought may be relevant to the claim or defense of any party.” DAC Surgical Partners P.A. v. United Healthcare Servs., Inc., No. 4:11-CV-1355, 2014 WL 585750, at *3 (S.D. Tex. Feb. 14, 2014). *2 Federal Rule of Civil Procedure 37(a) governs motions to compel discovery responses. A party seeking discovery may move for an order compelling production or answers against another party when the latter has failed respond to an interrogatory submitted under Rule 33 or has failed to produce documents requested under Rule 34. Fed. R. Civ. P. 37(a)(3)(B). “A party may move to compel production of materials that are within the scope of discovery and have been requested but not received.” Crosswhite v. Lexington Ins. Co., 321 F. App'x 365, 368 (5th Cir. 2009) (citing Fed. R. Civ. P. 37(a)). “A party who has objected to a discovery request must, in response to a Rule 37(a) motion to compel, urge and argue in support of its objection to an interrogatory or request, and, if it does not, it waives the objection.” Harper v. City of Dallas, Texas, No. 3:14-CV-2647-M, 2017 WL 3674830, at *6 (N.D. Tex. Aug. 25, 2017) (citations omitted). III. Analysis A. Woodsboro's Contention Interrogatories Nos. 1–6 Woodsboro requests that the Court overrule objections and compel TIG's to answer Interrogatories Nos. 1–8, the first six of which are contention interrogatories. (Dkt. No. 42 at 3; Dkt. No. 42-1 at 5–6; Dkt. No. 45 at 2). Woodsboro states that it based these interrogatories on TIG's complaint. (Dkt. No. 42 at 3). Woodsboro further states that TIG responded with boilerplate objections constituting an obstruction of discovery. (Id. at 3–4). In response, TIG states that the contention interrogatories would require TIG to “marshal its evidence” and “present its case in chief in its responses.” (Dkt. No. 45 at 2, 9). TIG contends that it is not required to do so at this time. (Id.). TIG argues that its potential duty to indemnify is determined based solely on the facts developed in the underlying litigation (id.), and thus it is unable to respond to the discovery requests until it has had an adequate opportunity to review the documents generated in the underlying litigation. (Id. at 9). TIG agrees to supplement its responses to the contention interrogatories after it completes its review of documents it recently received from Woodsboro pertaining to the underlying litigation. (Dkt. No. 45 at 2). Woodsboro seeks to compel TIG to immediately respond to the contention interrogatories, asserting that TIG has had more than adequate time to investigate Erwin's claim. (Dkt. No. 46 at 3–4). For each Interrogatory Nos. 1 through 6, the request states, “Identify each fact you contend was established in the Underlying Litigation that supports your contention that ....” (Dkt. No. 42-1 at 5–6). The Court agrees with Woodsboro's general premise that contention interrogatories “which seek information about the factual bases underlying the claims and contentions of an adverse party, are expressly authorized...” (Dkt. No. 46 at 2) (citing Jonibach Mgmt. Tr. v. Wartburg Enters., 136 F. Supp. 3d 792, 822 n.32 (S.D. Tex. 2015)). However, contention interrogatories should not request “a detailed and exhaustive list of all evidence that may be offered in support of its denials,” but can request that the opposing party “explain the factual bases for its denials.” (Dkt. No. 46 at 1–2) (citing Lamar Advert. Co. v. Zurich Am. Ins. Co., No. 18-1060-JWD-RLB, 2020 U.S. Dist. LEXIS 13891, at *14–15 (M.D. La. 2020)). The Court finds that Woodsboro's Interrogatories Nos. 1–6, as worded, are overly broad and go beyond the scope of proper contention interrogatories. By requesting TIG to “[i]dentify each fact you contend was established in the Underlying litigation that supports your contention that...” (Dkt. No. 42-1 at 5–6) (emphasis added), Woodsboro is effectively requesting “a detailed exhaustive list of all evidence.” Lamar, 2020 U.S. Dist. LEXIS 13891, at *14–15. Thus, Woodsboro's request to compel TIG to identify each fact as requested by Interrogatories Nos. 1–6 is DENIED. *3 Nonetheless, the general premise of Woodsboro's contention interrogatories is permissible. The Court therefore MODIFIES Woodsboro's Interrogatories Nos. 1–6 and, for each of those interrogatories, ORDERS TIG to explain the factual bases for the subject matter identified in each interrogatory by providing the material facts upon which it relies; but TIG is not required to provide a detailed and exhaustive listing of all evidence that may be offered in support of its denials. As discussed at the March hearing, the Court ORDERS TIG to respond to Woodsboro's Interrogatories Nos. 1—6, as herein modified by the Court, by May 19, 2020. B. Woodsboro's Interrogatories Nos. 7 and 8 At the March hearing, the Court heard the parties' arguments as to appropriateness of TIG's objections to Woodsboro's Interrogatories Nos. 7 and 8 and whether TIG's answers to those interrogatories—made subject to the asserted objections—were sufficient. Based on the discussion during the March hearing, including the reasons articulated by the Court, which are incorporated into this Order, the Court ORDERS as follows: 1. TIG's objections to Interrogatories Nos. 7 and 8 are OVERRULED. 2. Based on the Court's finding that TIG's answers to Interrogatories Nos. 7 and 8 are adequate, Woodsboro's Motion to Compel more complete answers to Interrogatories Nos. 7 and 8 is DENIED. C. Woodsboro's Requests for Production Woodsboro's Request for Production No. 1 seeks a copy of TIG's claims file related to the incident made subject of the suit. (Dkt. No. 42-1 at 5). Woodsboro's Request for Production No. 2 seeks any correspondence related to this incident or occurrence made subject of this lawsuit which was authored or received by TIG. (Id.). Woodsboro contends that these requested documents are relevant and discoverable because TIG relied upon them to support its decision to deny coverage and thereby bring this suit. (Dkt. No. 42 at 4). TIG responds that these documents are irrelevant to a suit for declaratory judgment to decide a duty to defend and duty to indemnify. (Dkt. No. 45 at 1). TIG states that the facts and evidence developed in the underlying litigation are the only discoverable documents relevant to the duty to indemnify. (Id. at 6). TIG further contends that the only documents relevant to the duty to defend are the insurance policy and the petition filed in the underlying litigation, in accordance with the “eight corners rule.” (Id. at 5). Moreover, TIG states that the claims file contains privileged documents. (Id. at 7). At the conclusion of the March hearing, the Court provided both parties the opportunity to submit supplemental briefing on the issue of whether an insurer's claims file and correspondence is relevant and discoverable in a lawsuit seeking a declaratory judgment on the duty to defend and the duty to indemnify. Woodsboro provided supplemental briefing identifying seven cases which it contends provide authority for the proposition that claims files and correspondence are relevant to coverage determination and breach of contract claims. (Dkt. No. 47 at 1). Six of the seven cases cited by Woodsboro are from district courts outside the Fifth Circuit. (Id.). None of the cases cited by Woodsboro are on point, however. Those cases either did not deal with an action for declaratory judgment or involved extra-contractual claims. (Id.). None of the cases cited by Woodsboro support the proposition that production of TIG's claims file and prior correspondence is appropriate in this case involving only claims for declaratory judgment on the duty to defend and duty to indemnify. *4 TIG's complaint, Woodsboro's counterclaim, and Erwin's counterclaim all seek a declaratory judgment on only the issues of the duty to defend and the duty to indemnify. (Dkt. Nos. 1, 28, 29). No pleading asserts an extra-contractual claim. In Colony Ins. Co. v. Peachtree Const., Ltd., where the plaintiff brought a claim for declaratory judgment on the issues of the duty to defend and indemnify, the Fifth Circuit determined, “When an insured party is sued, an insurer's duty to defend is determined solely by the facts alleged in the petition and the terms of the policy.” 647 F.3d 248, 253 (5th Cir. 2011) (citing Pine Oak Builders, Inc. v. Great Am. Lloyds Ins. Co., 279 S.W.3d 650, 654 (Tex.2009)). This is known as the eight-corners rule. Id. Furthermore, as TIG has asserted, the duty to indemnify is based on the actual evidence developed in discovery or at trial in the underlying litigation. See e.g. City of Coll. Station, Tex. v. Star Ins. Co., 735 F.3d 332, 340 (5th Cir. 2013). Woodsboro has failed to identify any authority that contradicts these well-established Fifth Circuit principles or that demonstrates that the claims file and correspondence are relevant to an action for declaratory judgment on the duty to defend and duty to indemnify. Accordingly, Woodsboro's Motion to Compel with respect to Requests for Production Nos. 1 and No. 2 is DENIED. D. Motion for Protective Order In its response to Woodsboro's Motion to Compel (Dkt. No. 42), TIG requests a protective order for the information sought by Woodsboro's requests for production and interrogatories. (Dkt. No. 45 at 10–13). Woodsboro argues that this Motion is untimely as TIG's request comes after the date the discovery material was to be produced and after the date of the pending Motion to Compel. (Dkt. No. 46 at 4–5). The Court agrees that this Motion is untimely. As such, the Court DENIES Plaintiff TIG's Motion for Protective Order. (Dkt. No. 45). IV. Conclusion In summary, the Court DENIES in part and GRANTS in part Defendant Woodsboro's Motion to Compel. (Dkt. No. 42). The request to compel TIG's production of the claims file and correspondence is DENIED. (Dkt. No. 42). The Court DENIES Woodsboro's Motion to Compel Plaintiff TIG's response to contention Interrogatories Nos. 1–6 as written; but the Court GRANTS the Motion to Compel TIG's answers to Interrogatories Nos. 1–6 as modified by the Court herein. The Court GRANTS in part the Motion to Compel as to Interrogatories Nos. 7 and 8 by overruling TIG's objections to those Interrogatories; but the Court DENIES the Motion to Compel as to those interrogatories to the extent that TIG is not ordered to supplement its answers. Regarding Interrogatories Nos. 1–6, as modified, TIG is ORDERED to serve supplemental responses on Woodsboro by May 19, 2020. Finally, Plaintiff TIG's Motion for Protective Order is DENIED. (Dkt. No. 45). Any other relief requested in Defendant Woodsboro's Motion to Compel (Dkt. No. 42) not expressly granted herein is DENIED. It is so ORDERED. SIGNED on April 7, 2020.