Hartford Casualty Insurance Company v. Fireman's Fund Insurance Company et al

Filing 75

ORDER RE: FIRST DISCOVERY DISPUTE (Illston, Susan) (Filed on 5/13/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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HARTFORD CASUALTY INSURANCE
COMPANY,
Plaintiff,

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Case No. 15-cv-02592-SI
ORDER RE: FIRST DISCOVERY
DISPUTE

v.
FIREMAN'S FUND INSURANCE
COMPANY, et al.,

Re: Dkt. No. 72

United States District Court
Northern District of California

Defendants.
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Defendant Fireman’s Fund Insurance Company (“Fireman’s”) and cross-defendant Mosen
O’Hadi have filed a joint statement regarding a discovery dispute concerning Fireman’s lack of
response to O’Hadi’s request for production of documents, set one (“RFPD 1”). Dkt. No. 72.

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BACKGROUND
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The underlying insurance coverage dispute concerns allegations by plaintiff Hartford
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Casualty Insurance Company (“Hartford”) that Fireman’s Fund issued an inadequate insurance
policy to Hartford’s assignor, Herndon Partners, LLC, in connection with a wrongful death

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lawsuit. Hartford has also alleged a professional negligence claim against the insurance broker,
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Burns & Wilcox Insurance Services, Inc. (“Burns & Wilcox”), based upon its failure to procure an

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insurance policy which would have provided liability coverage to Herndon, as raised in the
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wrongful death action. In response, Burns & Wilcox has filed a cross-complaint against Mosen
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O’Hadi, dba Malibu Pacific Insurance Agency, for declaratory relief and indemnity, asserting that

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its negligence in the procurement of the policy, if any, was caused by acts or omissions of Mr.
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O’Hadi. See Dkt. 42 (second amended complaint); Dkt. 17 (cross-complaint).

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O’Hadi’s RFPD 1 to Fireman’s requested, “A complete copy of the claims file for claim

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no. 00510803190. (The claims file pertains to a claim for coverage filed by Herndon Partners,

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LLC, and/or Paul Owhadi, regarding the death of Francisco Martinez Moreno at the home located

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at 31522 Broad Beach Road, Malibu, CA, in or about September 2009, and the subsequent

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wrongful death lawsuit filed by Mr. Moreno’s family, Fresno County Superior Court Case No. 1

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OCECG03837.)” Dkt. 72 at 1.
O’Hadi’s request is supported by his assertion that, since Hartford’s complaint against

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Fireman’s is based on Fireman’s decision to decline coverage to Herndon, the claims file

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associated with the policies at issue contains information relevant to determining coverage,

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including the reasoning behind Fireman’s ultimate decision to deny it. Dkt. 72 at 1-2. Fireman’s

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United States District Court
Northern District of California

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counters that O’Hadi’s request (1) is not relevant to the reformation and professional negligence

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actions that are being asserted and (2) is overly broad and not proportional to the needs of the case.

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See Fed. R. Civ. P. 26(b)(1).

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LEGAL STANDARD

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Rule 26(b)(1) provides that “[p]arties may obtain discovery regarding any nonprivileged

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matter that is relevant to any party’s claim or defense.” Fed. R. Civ. P. 26(b)(1). Rule 26 defines

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relevant information as any information that “appears reasonably calculated to lead to the

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discovery of admissible evidence.” Id. The Supreme Court states that Rule 26 affords liberal

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discovery. Seattle Times, Co. v. Rhinehart, 467 U.S. 20, 34 (1984).

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The heavy burden of showing why discovery should be denied rests with the party

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resisting discovery. Blankenship v. Hearst Corp., 519 F.2d 418, 429 (9th Cir. 1975). The

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resisting party must show that the discovery request is overly broad, unduly burdensome,

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irrelevant or disproportional in light of “the issues at stake.” Fed. R. Civ. P. 26(b)(2)(C); Beckman

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Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 472-73 (9th Cir. 1992). To meet this burden, the

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resisting party must specifically detail the reasons why each request is improper. Beckman Indus.,

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966 F.2d at 476 (“Broad allegations of harm, unsubstantiated by specific examples or articulated

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reasoning, do not satisfy the Rule 26(c) test.”).
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DISCUSSION

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Fireman’s does not carry its burden here. It objects to O’Hadi’s request on the basis that

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“the documents relevant to this action are contained in the underwriting file” and “there is no

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dispute that the policies as written do not provide coverage to Herndon for the underlying claims.”

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Dkt. 72 at 2. But it is clear that documents contained in the claims file, which likely include an

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explanation of Fireman’s decision to deny coverage, are relevant to determining what policies

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were issued, the terms and extent of each policy’s coverage, and if the alleged inadequacy in

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coverage was foreseeable and thus caused by the professional negligence of Burns & Wilcox, and

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by extension, O’Hadi.
O’Hadi’s request is not overly broad and is proportional to the needs of the case. The

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United States District Court
Northern District of California

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request details that O’Hadi seeks, “The claims file pertain[ing] to a claim for coverage filed by

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Herndon Partners, LLC, and/or Paul Owhadi, regarding the death of Francisco Martinez Moreno at

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the home located at 31522 Broad Beach Road, Malibu, CA, in or about September 2009, and the

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subsequent wrongful death lawsuit filed by Mr. Moreno’s family, Fresno County Superior Court

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Case No. 1 OCECG03837.)” The request details what is sought and, as explained above, what is

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sought appears reasonably calculated to lead to the discovery of admissible evidence.

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CONCLUSION

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The Court orders Fireman’s to produce the claims file in compliance with O’Hadi’s request

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for production of documents, set one (“RFPD 1”).

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IT IS SO ORDERED.
Dated: May 13, 2016
______________________________________
SUSAN ILLSTON
United States District Judge

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