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McCall v. State Farm Mutual Automobile Insurance Co.

United States District Court, D. Nevada

July 26, 2017

LORENE MCCALL, Plaintiff,
v.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant.

          ORDER

          GEORGE FOLEY, JR. United States Magistrate Judge

         This matter is before the Court on the following motions: (1) Defendant State Farm's Motion to Quash Plaintiff's Subpoena to Certified Medical Consultants Inc. (ECF No. 17), filed on June 12, 2017; (2) Defendant State Farm's Motion for Protective Order as to Plaintiff's Rule 30(b)(6) Deposition Subpoena to Certified Medical Consultants Inc. (ECF No. 18), filed on June 12, 2017; (3) Defendant State Farm's Motion for Protective Order as to Plaintiff's Rule 30(b)(6) Deposition Subpoena to State Farm (ECF No. 19), filed on June 12, 2017; (4) Plaintiff's Countermotion to Compel Production of Documents (ECF No. 27), filed on June 28, 2017; and (5) Defendant State Farm's Motion for Protective Order as to Plaintiff's Second Rule 30(b)(6) Deposition Subpoena to Certified Medical Consultants Inc. (ECF No. 21), filed on June 22, 2017. The Court conducted a hearing on these motions on July 10, 2017.

         BACKGROUND

         Plaintiff Lorene McCall filed her complaint against Defendant State Farm Mutual Automobile Insurance Company in the District Court, Clark County, Nevada on January 5, 2016. Petition for Removal (ECF No. 1), Exhibit A, Complaint (hereinafter Complaint). Defendant filed its answer in the state court action on March 1, 2016. Id. at Exhibit C. Defendant thereupon removed the action to this court on May 11, 2016. Petition for Removal (ECF No. 1).

         Plaintiff alleges that she was injured in a July 22, 2013 motor vehicle accident that was caused by the fault of the other driver. She subsequently settled with the other driver for the $10, 000 limits of his liability insurance policy.[1] Complaint, at ¶¶ 6-8. On November 20, 2014, Plaintiff made a demand for payment of the $25, 000.00 underinsured motorist coverage limits under the insurance policy issued to her by Defendant State Farm. State Farm evaluated Plaintiff's claim and determined that there was no underinsured motorist exposure arising from the July 22, 2013 accident. Id. at ¶¶ 11-12. Plaintiff alleges causes of action against Defendant for breach of contract, breach of the covenant of good faith and fair dealing (bad faith), and unfair claims practices in violation of Nevada Revised Statute (“NRS”) 686A.310. Plaintiff states that State Farm has since paid the $25, 000 underinsured motorist coverage limits. She is therefore proceeding on her causes of action for common law bad faith and violations of NRS 686A.310.

         Plaintiff attached as an exhibit to her oppositions a copy of her attorney's November 20, 2014 demand letter to State Farm which listed $33, 225.00 in past medical expenses and $21, 000.00 for future medical expenses. Opposition (ECF No. 26), Exhibit 1. She also attached the April 24, 2015 letter from State Farm's claim representative which stated:

[W]e have received the utilization report of Sanghamitra Basu, MD who reviewed this matter at the request of State Farm, and have enclosed a copy of his report for your review.
Based on our evaluation of the available information, along with the report of Dr. Basu, it appears that the tort-feasor's liability limits will sufficiently reimburse your client for her bodily injuries. As such, we do not believe that any UIM value exists for this loss.

         Opposition (ECF No. 26), Exhibit 2.

         Plaintiff alleges that State Farm relied on Dr. Basu's report to deny her underinsured motorist claim. Neither party has provided the Court with a copy of Dr. Basu's report. Nor have they provided any summary of her medical opinions. State Farm obtained Dr. Basu's services through Certified Medical Consultants which provides physicians in various medical fields to review claimants' medical records and provide opinions on relevant medical issues in a claim. It is the Court's understanding that State Farm pays a fee to Certified Medical Consultants for obtaining the medical expert's opinion and that Certified Medical Consultants, in turn, pays the physician for his or her services. The fees or rates charged for these services are presumably set forth in the parties' contracts.

         The Court entered a scheduling order on August 2, 2016 which set a discovery cut-off date of January 24, 2017, and initial and rebuttal expert witness disclosure deadlines of November 28 and December 28, 2016, respectively. Order (ECF No. 10). On December 16, 2016, the Court granted the parties' first stipulation to extend discovery by 90 days. The new discovery cut-off date was April 24, 2017. Order (ECF No. 13). On March 31, 2017, the Court granted the parties' second stipulation to extend discovery by 90 days which set a discovery deadline of June 23, 2017. Order (ECF No. 15). The parties' second stipulation stated that they disclosed their expert witnesses on November 28, 2016. Id. at pg. 2. State Farm deposed Plaintiff's “bad faith” expert, Frederick Berry, Jr., on May 23, 2017. See Opposition (ECF No. 27), Exhibit 17.

         Plaintiff served requests for production of documents on State Farm on February 24, 2017.

         Opposition (ECF No. 26), Exhibit 4. Plaintiff's requests for production include the following:

Request No. 4: all correspondence, e-mail correspondence, reports, opinions or other writings provided to or obtained from any expert witness or specialist in this case;
Request No. 5: all documents relied on by an expert witness or specialist in this case in forming his/her opinion, including correspondence, e-mail correspondence, reports, medical records, treatises, articles, photographs or writings;
Request No. 10: all files related to Defendant's handling of the Plaintiff's claim;
Request No. 12: all documents, writings, and communications that are used by State Farm personnel for reference, training and guidelines for the handling of underinsured motorist claims. These items should include, but not be limited to, all claims manuals, all written of (sic) computerized guidelines, all information provided to Defendant's claims personnel regarding the adjudication of claims and all other resources used by Defendant's personnel for the adjudication of claims;
Request No. 14: any and all written contracts or agreements, by whatever name, between State Farm and Certified Medical Consultants;
Request No. 15: any and all documents, in whatever form, related to the approval of Certified Medical Consultants as a vendor;
Request No. 16: any and all 1099s issued by State Farm to Certified Medical Consultants in the past five years;
Request No. 17: any and all 1099s issued by State Farm to Dr. Sanghamitra Basu in the past five years;
Request No. 18: any and all documents, including but not limited to records review reports sent to or received from Certified Medical Consultants and/or Dr. Sanghamitra Basu in connection with the utilization review on Plaintiff's claim;
Request No. 19: any and all requests for utilization reports in connection with an uninsured/underinsured motorist claim, sent from State Farm to Certified Medical Consultants in the past five years;
Request No. 20: any and all utilization reports authored by Dr. Sanghamitra Basu on behalf of State Farm, in connection with an uninsured/underinsured motorist claim, in the past five years;
Request No. 21: any and all correspondence, in whatever form, between State Farm and Certified Medical Consultants regarding the present claim;
Request No. 22: any and all correspondence, in whatever form, between State Farm and Dr. Sanghamitra Basu regarding the present claim.

         Opposition (ECF No. 26), Exhibit 4.

         State Farm served its responses to Plaintiff's requests for production on April 18, 2017, and its supplemental responses on April 26, 2017. Motion (ECF No. 17), Exhibits C and D; Opposition (ECF No. 26), Exhibits 5 and 6. Defendant attached to its supplemental responses a proposed stipulated confidentiality order. Id. In response to Request No. 1, State Farm stated that it had produced its complete claim file regarding Plaintiff's underinsured motorist claim except for portions protected by the attorney-client privilege or work product doctrine. In response to Request No. 4, State Farm stated that its experts' written reports identified the documents considered in forming their opinions which had already been produced to Plaintiff, and that State Farm would supplement its response if the experts had any additional responsive documents that are discoverable and not protected from disclosure under Rule 26. In response to Request Nos. 10, 18, 21 and 22, State Farm referred to its response to Request No. 1 regarding its production of the claims file. State Farm objected to Request No. 12 on the grounds that its claims manuals contain confidential, proprietary business information and trade secrets. State Farm stated that it would produce relevant portions of the manuals that do not contain privileged information, and would produce other relevant claims manual documents upon entry of a protective order. State Farm objected to Requests Nos. 14, 15, 16, 17, 19 and 20 on the grounds that they are irrelevant and seek confidential, proprietary business information and trade secrets. State Farm also objected to Request Nos. 19 and 20 as unduly burdensome. Motion (ECF No. 17), Exhibit C. In its supplemental responses served on April 26, 2017, State Farm produced some claims manual documents. It also served a privilege log and a proposed stipulated protective order. Motion (ECF No. 17), Exhibit D, at page 10, supplemental response to Request No. 12.

         On May 23, 2017, Plaintiff served a notice to take the Rule 30(b)(6) deposition of Certified Medical Consultants on June 20, 2017-three days before the discovery cut-off. Motion (ECF No. 17), Exhibit A. The notice listed the following topics: (1) the corporate structure of Certified Medical Consultants; (2) all written contracts between Certified Medical Consultants and State Farm; (3) all communications between Certified Medical Consultants and State Farm related to approval of Certified Medical Consultants as a vendor; (4) all 1099s issued to Certified Medical Consultants by State Farm in the past 5 years; (5) all documents Certified Medical Consultants sent to or received from State Farm in connection with the utilization review of Plaintiff's UIM claim; (6) all requests for utilization reports in connection with an uninsured/underinsured motorist claim that Certified Medical Consultants received from State Farm in the past 5 years; (7) the doctors assigned to perform utilization reports requested by State Farm; and (8) all correspondence between State Farm and Certified Medical Consultants regarding Plaintiff. The subpoena only required Certified Medical Consultants to provide testimony on the listed topics. It did not include a requirement to produce documents at the deposition. Joinder (ECF No. 25), Exhibit A. On June 12, 2017, State Farm filed its emergency motions to quash the subpoena and for protective order against the taking of the deposition of Certified Medical Consultants. Motions (ECF Nos. 17, 18).

         On June 14, 2017, Certified Medical Consultants' attorney conducted a conference with Plaintiff's attorney in which he proposed that in lieu of taking a live deposition, Certified Medical Consultants would produce to Plaintiff (1) the 1099s issued to Certified Medical Consultants by State Farm for the past five years, (2) Certified Medical Consultants' records showing the documents it sent to Dr. Basu that were reviewed by her in connection with her reports, and (3) the reports that Dr. Basu authored in the last 5 years when she has been retained by State Farm through Certified Medical Consultants. Joinder (ECF No. 25), (declaration of counsel, pg. 3), and Exhibit B, (June 15, 2017 letter from Certified Medical Consultants' attorney to Plaintiff's counsel). Certified Medical Consultants' counsel represents that he waited for a response from Plaintiff to his proposed compromise. Instead of responding to the proposal, Plaintiff served an amended notice of deposition and subpoena on June 19, 2017 which required the deponent to produce documents at the deposition which was rescheduled for June 23, 2017. Joinder (ECF No. 25), Exhibits D and E. This prompted State Farm to file another motion for protective order on June 22, 2017 to prohibit the Rule 30(b)(6) deposition of Certified Medical Consultants.

         On May 23, 2017, Plaintiff also served a notice of Rule 30(b)(6) deposition of Defendant State Farm to be taken on June 21, 2017. Opposition (ECF No. 27), Exhibit 8 (deposition notice). The deposition notice listed 30 topics of inquiry. It did not require State Farm to produce any documents at the deposition. Id. On June 5, 2017, Plaintiff's and Defendant's counsel engaged in a meet and confer conference regarding the deposition topics. Opposition (ECF No. 27), Exhibit 10. State Farm agreed to produce a deponent(s) to testify on topic Nos. 3, 4, 6, 7, 9, 19, 21, 24, 25 and 29. It agreed to produce a deponent to testify to part of topic No. 10, and agreed to produce a deponent(s) to testify on topic Nos. 1, 2, 11, 12, 14 and 28 subject to the limitations set forth in counsel's letter. Id. The parties were unable to reach an agreement on the other deposition topics.

         State Farm seeks an order prohibiting Plaintiff from deposing it on the following topics:

5. State Farm's policies and procedures regarding audits, file reviews, or any other review, as well as any such audits/reviews of this file from the date of the subject ...

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