Welle v. Provident Life and Accident Insurance Company

Filing 41

Order by Magistrate Judge Kandis A. Westmore regarding 30 Discovery Letter Brief.(kawlc2, COURT STAFF) (Filed on 10/17/2013)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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D.O. DANA M. WELLE,

Case No.: 3:12-cv-3016 EMC (KAW)

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Plaintiff,

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v.
PROVIDENT LIFE AND ACCIDENT
INSURANCE COMPANY,

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United States District Court
Northern District of California

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ORDER REGARDING SEPTEMBER 17,
2013 DISCOVERY LETTER

Defendant.

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On July 8, 2013, this matter was referred to the undersigned for discovery purposes.

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(Order of Reference, Dkt. No. 28.) On September 17, 2013, the parties filed a joint discovery

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letter. (Joint Ltr., Dkt. No. 30.) Pursuant to Civil Local Rule 7-1(b), this matter is deemed

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suitable for disposition without hearing. Having reviewed the papers filed by the parties, the

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court overrules Provident's objections to Plaintiff's Requests for Production Nos. 68, 70, 72, and

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76 and sustains Provident's relevancy objection to Plaintiff's Request for Production No. 79.

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I.

BACKGROUND

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On October 4, 1994, Provident Life & Accident Insurance Company ("Provident") issued

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Doctor Dana Welle ("Plaintiff") an individual disability insurance policy. (Compl. ¶ 5, Dkt. No.

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1.) Under the terms of that policy, Provident promised to pay Plaintiff a base monthly benefit in

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the event she became totally disabled. (Id.) On March 2, 2003, Plaintiff sustained injuries to her

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left arm as a result of a bike accident. (Id. ¶ 9.) Plaintiff underwent multiple surgeries, was

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diagnosed with left ulnar neuropathy and left medial epicondylitis, and continues to experience

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pain and weakness in her left arm. (Id.) Plaintiff alleges that the impairment "impacted her use of

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her dominant hand in order to safely care for her patients." (Id. ¶ 10.)

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On April 7, 2009, Plaintiff submitted a claim to Provident for disability insurance benefits.

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(Id. ¶ 11.) On June 25, 2009, Provident notified Plaintiff that the claim had been approved and

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benefits were payable as of May 29, 2009. (Id. ¶ 14.) Provident approved the claim through

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2010. (Id. ¶ 16.) In 2011, Provident ordered surveillance as part of its claims investigation. (Id.

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¶ 17.) Provident denied Plaintiff's disability insurance claim on March 20, 2012. (Id. ¶ 19.)

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On April 19, 2012, Plaintiff filed her complaint against Provident, alleging breach of

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contract and breach of the duty of good faith and fair dealing. (Id. at 6, 8.)
II.

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LEGAL STANDARD

Federal Rule of Civil Procedure 26(b)(1) permits "discovery regarding any nonprivileged
matter that is relevant to any party’s claim or defense." The information sought "need not be

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United States District Court
Northern District of California

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admissible at the trial" so long as it "appears reasonably calculated to lead to the discovery of

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admissible evidence." Id.

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Federal Rule of Civil Procedure 34(a) provides:

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A party may serve on any other party a request within the scope of Rule
26(b):
(1) to produce and permit the requesting party or its representative to
inspect, copy, test, or sample the following items in the responding party's
possession, custody, or control:
(A) any designated documents or electronically stored information-including writings, drawings, graphs, charts, photographs, sound recordings,
images, and other data or data compilations--stored in any medium from which
information can be obtained either directly or, if necessary, after translation by the
responding party into a reasonably usable form . . . .
Such request "must describe with reasonable particularity each item or category of items to be

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inspected." FED. R. CIV. P. 26(b)(1)(A).
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Discovery of relevant personnel records is allowed when there is a showing of
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“compelling need.” See Cecena v. Allstate Ins. Co., C05-03178 JF (HRL), 2006 WL 3302837

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(N.D. Cal. Nov. 9, 2006) (citing Bd. of Trustees v. Superior Court, 119 Cal. App. 3d 516, 525
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(1981) ("And even when discovery of private information is found directly relevant to the issues
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of ongoing litigation, it will not be automatically allowed; there must then be a 'careful balancing'
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of the 'compelling public need' for discovery against the fundamental right of privacy) (further

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citation omitted)).
III.

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DISCUSSION

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A.

Requests for Production Nos. 68, 70, 72, & 76

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Plaintiff requests that Provident produce "any and all documents that reflect, refer or relate
to bonus awards, including but not limited to the performance rating and percent of bonus

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awarded" to Tina Giacobbi, Nichole Cardin, Tricia Truchess, and Ronald K. Freund from 2008 to

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the present. (Joint Ltr., Ex. A at 4, 5.) These individuals are the claims adjusters and the in-house

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doctor who were involved in the resolution of Plaintiff's claim. (Joint Ltr. at 2, 3.) Plaintiff

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argues that the information sought is relevant to her claim that Provident acted in bad faith in

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United States District Court
Northern District of California

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denying her claim for disability insurance benefits. (Id. at 3.)

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Provident objects on the basis of privacy, and claims that Plaintiff's request is overly broad

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and unduly burdensome, vague and ambiguous, seeks information that is not relevant to any claim

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or defense, and concerns confidential and/or proprietary business records. (Id. at 3.) Provident

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argues that "the presence of a financial incentive does not mean that a claim's denial was based on

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that incentive" and that it "has already explained that Tina Giacobbi, Patricia Truchsess, Nichole

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Cardin, and Ronald Freund, M.D.'s incentive compensation is not dependent on the outcome of

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any claim decision or any number of claim decisions." (Id. at 4, 5.)

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The court finds that Plaintiff's request is not overly broad, unduly burdensome, vague, or

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ambiguous. Plaintiff's contention that the request concerns information that is not relevant to any

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claim or defense lacks merit. To the extent that Plaintiff's theory is that the incentive structure is

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based on performance, and performance may, in turn, be measured in terms of the resolution of

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claims, including her own claim, the information she seeks in these requests speaks to whether her

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claim was improperly denied and whether Provident encourages bad faith practices. See Saldi v.

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Paul Revere Life, 224 F.R.D. 169, 184 (E.D. Pa. 2004); Grange Mut. Ins. Co. v. Trude, 151

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S.W.3d 803, 815 (Ky. 2004); Zilisch v. State Farm Mut. Auto. Ins. Co., 995 P.2d 276, 280 (Ariz.

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2000) (en banc). Provident's objection that the information sought in these requests is not

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relevant is therefore overruled. The court also overrules Provident's objection that the
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information Plaintiff seeks is confidential or proprietary. The parties have stipulated to a

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confidentiality agreement and protective order in this case. (See Dkt. No. 22.) Provident has

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offered no persuasive reason why the information at issue here, if in fact confidential or

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proprietary, would not be adequately protected under that agreement.

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As for Provident's objection on the basis of privacy, this court has already explained

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Plaintiff has shown compelling need for discovery of relevant personnel information. (See July

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31, 2013 Order Regarding Discovery Dispute, Dkt. No. 29.) While the court reached that

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conclusion in resolving Plaintiff's request for production of performance reviews of certain

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Provident employees, the same reasoning applies here. Plaintiff has shown a compelling need for
the documents containing information related to bonuses and performance ratings of those

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United States District Court
Northern District of California

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involved in the adjustment of her disability insurance claim. The information is highly relevant to

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her bad faith claim. Moreover, Plaintiff's request is squarely limited to information concerning

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bonus and performance rating information, it does not seek of other sensitive information, such as

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employees' original job application, marital status, tax and dependent data, etc. In addition, the

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employees' privacy rights are adequately protected by the confidential agreement and protective

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order to which the parties have stipulated. Provident shall therefore supplement its responses

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accordingly.

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B.

Requests for Production No. 79

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Plaintiff requests "[a] true and correct copy of all of Provident's guidelines relating or

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referring or applicable to NaviLink from 2008 to present." (Joint Ltr. at 5.) In the parties' joint

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letter, Plaintiff offers no explanation of what the NaviLink system is, asserting only that the

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documents responsive to this request "are relevant and necessary in order to ensure that the

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NaviLink reports and files related to Dr. Welle's claim were handled according to proper

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guidelines." (Id. at 6.)

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Provident asserts that NaviLink is a proprietary computer system that does not pertain to

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the procedures for deciding disability claims. (Id.) Provident argues that Plaintiff has not

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articulated the relevance of the materials sought, that the request is overbroad, and concerns

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confidential and proprietary information. (Id.) Provident also asserts that the guidelines Plaintiff
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wishes to examine are contained not within the NaviLink manual, but within the claims manual

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compact disc that Provident has already produced to Plaintiff. (Id.)

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Again, as this court previously explained in the order resolving the parties' July 1, 2013

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joint letter, in which Plaintiff made a similar request concerning MITRAK system guidelines,

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Plaintiff has not sufficiently articulated a theory of relevance or established any connection

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between the NaviLink system guidelines and the merits of the case. (See July 31, 2013 Order

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Regarding Discovery Dispute at 3.) Accordingly, Provident's objection on the basis of relevance

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is sustained.
IV.

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CONCLUSION

Provident's objections to Plaintiff's Requests for Production Nos. 68, 70, 72, and 76 are

United States District Court
Northern District of California

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overruled and Provident shall supplement its responses to those requests within 30 days of the

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date of this order. Provident's relevancy objection to Plaintiff's Request for Product No. 79 is

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sustained.

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Furthermore, the court orders the parties to meet-and-confer in-person prior to filing any

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additional joint discovery letters in this case. During any such in-person meet-and-confer, the

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parties shall jointly review this court's prior orders resolving any prior joint discovery letters.

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Where, as here, a prior order of this court clearly addresses a point of contention, the parties shall

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attempt to resolve their disputes accordingly. If, notwithstanding an applicable prior order, the

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parties agree that they are unable to resolve the issue on their own and decide to file another joint

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discovery letter, the parties shall thoroughly explain why an applicable prior order of this court

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does not resolve the dispute necessitating the filing of another joint discovery letter.

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IT IS SO ORDERED.
Dated: October 17, 2013
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KANDIS A. WESTMORE
United States Magistrate Judge

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