Travelers Property Casualty Company of America et al v. Centex Homes

Filing 169

Order by Magistrate Judge Donna M. Ryu re 164 Discovery Letter Brief.(dmrlc1, COURT STAFF) (Filed on 4/1/2013)

1
2
3
4
5
6
7
8

UNITED STATES DISTRICT COURT

9

NORTHERN DISTRICT OF CALIFORNIA

11
For the Northern District of California

United States District Court

10
TRAVELERS PROPERTY CASUALTY,

12
13

No. C 11-03638 DMR
ORDER REGARDING FEBRUARY 26,
2013 JOINT DISCOVERY LETTER

Plaintiff,
v.

14

CENTEX HOMES,

15

Defendant.
___________________________________/

16
17

Before the court is the parties’ February 26, 2013 joint discovery letter regarding Defendant

18

Centex Homes’s (“Centex”) motion to compel. [Docket No. 164 (Joint Letter).] The court finds that

19

the matter is appropriate for resolution without oral argument pursuant to Civil Local Rule 7-1(b).

20

For the reasons below, Defendant’s motion to compel is GRANTED.

21
22

I. Background
On December 11, 2012, Centex and Plaintiff Travelers Property Casualty Co. (“Travelers”)

23

submitted a joint discovery letter regarding Centex’s request for an order compelling production of a

24

document for which Travelers had asserted claims of attorney-client privilege and work product

25

protection and protection as a trade secret. [Docket No. 115 (Dec. 11, 2012 Joint Letter).] Centex

26

first learned of the existence of the document at the deposition of a Travelers’ claims adjuster. The

27

adjuster testified that she received a written guideline from her manager regarding the timing of

28

certain claims handling actions. (Dec. 11, 2012 Joint Letter 2, Ex. A.) Following the deposition,

1

Centex asked Travelers to produce the document. Travelers responded by producing a version of

2

the document, the “Construction Defect File Review Guidelines 2008,” (the “2008 Guidelines”), that

3

it had redacted in its entirety. Travelers produced an accompanying privilege log. (Dec. 11, 2012

4

Joint Letter 2, Ex. B.) Following the court’s in camera review of the document and a hearing on the

5

matter, the court ordered Travelers to produce the document. [Docket No. 127 (Jan. 10, 2013

6

Minute Order).] At the hearing, the court noted that the document appeared to be “guidelines that

7

supervisors are supposed to use in evaluating supervisees across different aspects of their work,” and

8

did not contain any privileged information. (Hr’g Tr. Jan. 10, 2013, 13:17-19.) Further, the court

9

noted that any concerns that the document contained proprietary business information would be

11
For the Northern District of California

United States District Court

10

addressed by the protective order in place in this case. (Hr’g Tr. 13:23-14:1.)
Following the court’s order, Travelers produced an unredacted version of the 2008

12

Guidelines to Centex. Travelers subsequently filed objections to the court’s January 10, 2013 order

13

with the Honorable Samuel Conti.1 [Docket No. 138 (Travelers’ Objections).] In its objections,

14

Travelers indicated that the 2008 Guidelines “[were] outdated and had been replaced” two years

15

before the deponent became a claims adjuster. (Travelers’ Objections 1.) Shortly thereafter,

16

Travelers’ submitted a declaration in which a Travelers’ employee stated that the 2008 Guidelines

17

“[have] subsequently been replaced.” (Decl. of Wolcott, Feb. 1, 2013, ¶ 7.) Centex asserts that

18

Travelers did not disclose the existence of “updates” to the 2008 Guidelines until February 1, 2013,

19

well after the December 2012 close of discovery.

20
21

Centex now moves to compel production of all versions of Travelers’ Construction Defect
File Review Guidelines.

22
23

II. Discussion
In this action, Centex alleges that Travelers failed to respond to Centex’s tenders in a timely

24

fashion and that it violated California’s insurance regulations by failing to respond to Centex’s

25

claims within a certain amount of time. To that end, Centex propounded document requests seeking

26
27
28

1

Judge Conti did not issue an order denying the motion or setting a briefing schedule within
14 days of Travelers’ objections. Travelers’ motion was therefore deemed denied. See N.D. Cal. Civ.
L.R. 72-2.

2

1

“all claims-handling guidelines, manuals, policies, procedures and other documents . . . which

2

discuss [Travelers’] practice for responding to tenders in a timely fashion.” (Joint Letter 2.)

3

According to Centex, the 2008 Guidelines specifically address the amount of time an adjuster may

4

take to respond to tenders. Centex argues that all versions of the 2008 Guidelines are responsive to

5

its discovery requests, and not just the version that happened to be identified by a deponent.

6

Although discovery closed in December 2012, Centex argues that the court should not deny this

7

motion as untimely because Centex only recently learned that Travelers had replaced its 2008

8

Guidelines. Specifically, while Travelers had previously argued that the 2008 Guidelines were

9

“outdated,” it was not until February 2013 that Travelers produced evidence that it had “replaced”

11
For the Northern District of California

United States District Court

10

the 2008 Guidelines.
Travelers argues that Centex is not entitled to the production of any additional documents for

12

two reasons. First, Travelers argues that the 2008 Guidelines are not responsive to any of Centex’s

13

discovery requests. Second, Travelers argues that Centex’s “failure to address this issue earlier

14

constitutes waiver,” arguing that Centex has known that there were other versions of the document

15

well before the discovery cutoff. (Joint Letter 6.)

16

Travelers’ arguments are unavailing. First, the court concludes that the 2008 Guidelines are

17

responsive to Centex’s request seeking “all claims-handling guidelines, manuals, policies,

18

procedures and other documents” which discuss Travelers’ “practice for responding to tenders in a

19

timely fashion.” While Travelers describes the document as “a quality control document” and

20

insists that it is not a “claims handling guideline,” (Joint Letter 6), the document provides standards

21

by which supervisors evaluate the performance of claims adjusters and unquestionably reflects

22

claims handling practices, including when certain claims-handling acts are considered “timely.”

23

(See Notice of Lodging in Supp. of Centex’s Consolidated Mot. for Partial Summary J., Ex. A.)

24

Travelers conceded the responsiveness of this document by listing it on a privilege log as a

25

document withheld from production on the basis of privilege.

26

The court also concludes that Centex’s motion is not untimely. Travelers had an obligation

27

to produce all updated versions of the 2008 Guidelines as documents that are responsive to Centex’s

28

discovery requests. Travelers is not excused from this duty simply because Centex did not

3

1

specifically ask for the updates. Furthermore, Travelers repeatedly described the 2008 Guidelines as

2

“outdated.” However, Travelers did not inform Centex that the document had been “replaced” until

3

after the discovery cutoff. There is a difference between describing a document as “outdated,” as

4

opposed to “replaced.” The latter implies the existence of an updated version; the former is

5

ambiguous. There is no indication that Centex knew about the existence of subsequent versions of

6

the 2008 Guidelines prior to the discovery cutoff. Under these circumstances, Centex did not waive

7

the right to move to compel the production of the additional versions of the document. Accordingly,

8

Centex’s request for an order compelling the production of all versions of the Construction Defect

9

File Review Guidelines which replaced the 2008 version is GRANTED. Travelers is ordered to
produce documents in conformance with this order by no later than April 12, 2013.

Dated: April 1, 2013

15

DONNA M. RYU
yu
United States Magistratea M. R
onn Judge
D

ER

H

17

Judge

18
19
20
21
22
23
24
25
26
27
28

4

LI

16

A

14

DERED

O OR
IT IS S

R NIA

13

FO

UNIT
ED

S

IT IS SO ORDERED.

S DISTRICT
TE
C
TA

RT
U
O

12

RT

For the Northern District of California

11

NO

United States District Court

10

N

F
D IS T IC T O
R

C