Last Friday, Halloween, the Texas Supreme Court delivered defendants a “treat” in the form of a mandamus opinion articulating the standard for when discovery requests seeking information related to claims other than the plaintiff’s claims crosses the line from seeking relevant information into an impermissible fishing expedition.

In In re National Lloyds Insurance Company, the Supreme Court considered whether a trial court abused its discretion in ordering the insurance company to produce information on claim files and claims other than the plaintiff’s claim.  This mandamus (mandamus is a fancy word that effectively means to appeal) proceeding arose in the context of a suit over the insurance carrier’s payment of a homeowner’s claim following the storm damage to her property.  The plaintiff sought discovery on:

  • All claim files from the previous six years involving six individual adjusters;
  • All claim files from the past year for properties located in Dallas and Tarrant Counties involving the two adjusting companies that handled Plaintiff’s claims;
  • A listing of the names, addresses, phone numbers, policy numbers and claim numbers associated with the requested files.

The insurance company objected to the requested discovery and the trial court ultimately ordered it to produce the files for the claims handled by the two adjusting companies and for all claims related to properties in Cedar Hill, Texas (a single municipality in Dallas County).  Despite the fact that the trial court narrowed the plaintiff’s requests before ordering production, National Lloyds filed a mandamus proceeding of the discovery order.

In quashing the ordered discovery, Supreme Court notably stated that:

[W]e fail to see how National Lloyd’s overpayment, underpayment, or proper payment of the claims of unrelated third parties is probative of its conduct with respect to Erving’s undervaluation claims at issue in this case. . .  . Scouring claim files in hopes of finding similarly situated claimants whose claims were evaluated differently from Erving’s is at best an ‘impermissible fishing expedition’  Without more, the information sought does not appear reasonably calculated to lead to the discovery of evidence that has a tendency ‘to make the existence of any fact that is of consequence to the determination of the action more probable or less probable.’

. . .

Because the information Erving seeks is not reasonably calculated to lead to the discovery of admissible evidence, the trial court’s order compelling discovery of such information is necessarily overbroad.

How is this discovery case in an insurance dispute relevant to discovery disputes in employment cases?  Plaintiffs in employment litigation frequently ask for all charges, lawsuits and claims of discrimination, retaliation or harassment that have been filed against the employer over the past several years.  Since individuals in companies, not companies, make employment decisions, I’ve always thought that, at most, these types of requests should be limited to charges, lawsuits and claims of discrimination involving the same decision maker as was involved in the plaintiff-employee’s case.  In re National Lloyds Ins. Co. supports that position and provides an employer with authority to utilize in seeking mandamus relief from a court of appeals from discovery orders that compel production of information that go beyond the plaintiff’s claim. 

You can download the full opinion in In re National Lloyds Insurance Company here.

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