Fiechtner v. American Family Mutual Insurance Company
Filing
338
ORDER granting in part and denying in part 240 Defendant American Family Mutual Insurance Companys Motion in Limine seeking to exclude evidence related to Defendants post-litigation conduct. by Judge William J. Martinez on 9/13/2011.(erv, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge William J. Martínez
Civil Action No. 09-cv-02681-WJM-MEH
DAWNMARIE FIECHTNER,
Plaintiff,
v.
AMERICAN FAMILY MUTUAL INSURANCE COMPANY,
Defendant.
ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANT’S MOTIONS IN LIMINE
RE: POST-LITIGATION CONDUCT
Before the Court is Defendant American Family Mutual Insurance Company’s
Motion in Limine seeking to exclude evidence related to Defendant’s post-litigation
conduct. (ECF No. 240.) At oral argument on July 11, 2011, the Court reserved ruling
on the Motion. (ECF No. 300.) On July 13, 2011, the Court granted the Motion in
Limine in so far as it sought to exclude evidence regarding the post-litigation conduct of
outside counsel stating: “Plaintiff will not be permitted to argue that outside counsel’s
conduct in defending against this action was evidence of bad faith on the part of
American Family.” (ECF No. 301.) With respect to the actions of Defendant’s in-house
attorneys, the Court ordered the parties to submit further briefing on the following:
(1) the specific evidence that Plaintiff seeks to admit with
respect to post-litigation conduct of attorneys employed by
American Family; (2) why that evidence is relevant, given the
Court’s July 11, 2011 oral ruling on the possible relevance of
post-litigation conduct with respect to American Family’s
non-attorney employees; (3) how the evidence Plaintiff
seeks to admit is more probative than prejudicial; and (4)
how/why that evidence is not subject to attorney-client
privilege and/or work product (e.g., employee was not acting
as attorney when action taken, attorney’s conduct is not a
communication for privilege purposes, etc.)
(Id.) Having received that supplemental briefing, the Court hereby GRANTS in part and
DENIES in part Defendant’s Motion in Limine as it pertains to Defendant’s in-house
attorneys.
From the parties’ supplemental briefing, it appears that only one in-house
attorney was involved in this case, John Haberland. Plaintiff identifies three categories
of evidence regarding Haberland’s post-litigation which she seeks to admit evidence
relevant to: (1) Haberland’s evaluation and adjustment of Plaintiff’s uninsured motorist
claim after litigation commenced; (2) Haberland’s attestation to discovery responses
that he knew were false or deficient; and (3) Haberland’s approval of the Answer filed in
this case asserting a comparative negligence affirmative defense. (ECF No. 3111 at 3.)
The Court will address each category of evidence in turn below.
A.
Evidence Re: Ongoing Duty to Evaluate and Adjust Plaintiff’s Claim
Plaintiff seeks to admit evidence related to whether, and to what extent,
Haberland continued to evaluate and adjust Plaintiff’s uninsured motorist claim after the
instant litigation commenced.
The issue underlying whether Plaintiff can introduce evidence regarding
1
The Court notes Plaintiff’s supplemental briefing is filed under seal due to the
confidentiality of portions of the evidence filed in support of such briefing. The Court will refrain
from citing the confidential evidence and, therefore, sees no reason why this Order should be
filed under seal.
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Haberland’s post-litigation conduct is to what extent Defendant had an ongoing duty of
good faith and fair dealing with respect to Plaintiff once this litigation was filed. Plaintiff
contends that Defendant had a duty to continue to evaluate her claim despite the
pendency of litigation. Defendant argues that, once litigation commenced, it was
adversarial to Plaintiff and, therefore, had no duty to settle her claim.
The Court need not resolve this dispute to address the instant issue of the
admissibility of Haberland’s post-litigation conduct. While the scope of the Defendant’s
duty of good faith and fair dealing may have changed when Plaintiff filed this lawsuit,
there is no dispute that some duty continued to exist. The Colorado Court of Appeals
has held: “The duty of good faith continues as long as the insurer-insured relationship
exists. Thus, the tort of bad faith breach of an insurance contract encompasses ‘all of
the dealings between the parties, including conduct occurring after the arbitration
procedure.’” Parsons ex rel. Parsons v. Allstate Ins. Co., 165 P.3d 809, 815 (Colo. App.
2006) (quoting Dale v. Guar. Nat’l Ins. Co., 948 P.2d 545, 552 (Colo. 1997)).
It appears undisputed that, once litigation commenced, Plaintiff’s file was
reassigned from the claim adjuster to Haberland in the legal department. From that
point forward, whatever duty of good faith and fair dealing Defendant owed to Plaintiff
would have been discharged by Haberland’s actions. Thus, Haberland’s post-litigation
conduct is relevant to Plaintiff’s bad faith claim.
The remaining question, therefore, is whether the fact that Haberland was an
attorney employed by Defendant affects this analysis. While the Court has no doubt
that Haberland was acting as an attorney with respect to some of his duties, and that
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some of his resulting actions or communications would therefore be privileged, at least
to some extent, Haberland was acting as a claims adjuster rather than an attorney. His
actions in this capacity are not protected by any attorney privilege or work-product
doctrine.
Colorado law clearly permits introduction of evidence of post-litigation conduct as
a basis for a bad faith claim. Dale, 948 P.2d at 552 (stating that the common law tort
claim of bad faith “included the entire course of the insurer’s conduct with respect to
Dale’s benefits until the time of trial.”). While there are concerns about allowing the
presentation of evidence of attorney post-litigation conduct because an insurance
company has the right to vigorously defend itself in any adverse action, see Parsons,
165 P.3d at 817-19, these concerns do not extend to an employee who is tasked with
investigating and adjusting a claim. The fact that Haberland is an attorney does not
shield all of his post-litigation conduct from inquiry.
Thus, the Court will permit Plaintiff to introduce evidence related to Haberland’s
post-litigation conduct to the extent it involves Haberland’s activities as a claims adjuster
rather than an attorney and Defendant’s Motion in Limine is DENIED in this respect.2
B.
Inadequate and/or Inaccurate Discovery Responses
Plaintiff seeks to admit evidence related to the fact that Haberland signed the
verification page of discovery responses that were inaccurate or inadequate. Plaintiff
2
Plaintiff’s supplemental briefing cites depositions of Dylan Lewis and John Craver
taken in another action in support of his argument. Plaintiff fails to explain how this prior
deposition testimony is not hearsay. The Court notes that neither of these deponents are listed
in the parties’ Final Witness Lists. Thus, the Court questions the admissibility in this action of
the statements made by Lewis and Craver.
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cites evidence showing that Haberland admitted in his deposition that he did not
understand certain discovery responses drafted by outside counsel but signed off on
their accuracy anyway.
The Court has already ruled that post-litigation conduct of outside counsel is not
admissible and views Plaintiff’s attempt to introduce evidence of the discovery
responses prepared by outside counsel as an end-run around this ruling. The Court will
not permit evidence related to how outside counsel chose to defend against this action.
Moreover, having reviewed the evidence cited by Plaintiff, the Court finds that it
is not probative of a bad faith claim. At worst, Haberland did not understand all of the
discovery responses drafted by outside counsel. This is not probative of whether
Defendant’s consideration of Plaintiff’s uninsured motorist claim was in bad faith.
If Plaintiff was concerned about the accuracy of Defendant’s discovery
responses, the proper remedy would have been to seek sanctions against Defendant
and its counsel for violation of the Federal Rules of Civil Procedure. The Court will not
allow Plaintiff to confuse the jury on the bad faith claim by admitting irrelevant evidence
about unclear discovery responses at trial. Thus, Defendant’s Motion in Limine is
GRANTED to the extent it seeks to exclude evidence of Haberland having attested to
Defendant’s discovery responses.
C.
Inclusion of Comparative Negligence Defense in Amended Complaint
Plaintiff seeks to admit evidence that Haberland signed off on the Answer filed in
this case, which asserted the affirmative defense of comparative negligence, even
though he allegedly knew that Defendant had waived such defense.
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The Court earlier denied Plaintiff’s Motion in Limine regarding Defendant’s
comparative negligence defense. The Court ruled that Defendant will be permitted at
trial to introduce evidence regarding Plaintiff’s negligence and will be permitted to argue
that Plaintiff has not shown a breach of contract because she was more than fifty
percent liable for the accident at issue.
Given this ruling, Plaintiff’s contention that Defendant waived its comparative
negligence defense is unfounded. Thus, the Court sees limited value in any evidence
suggesting that Haberland acted in bad faith because he allowed outside counsel to
assert a valid defense. This again seems to be an attempted end-run around the
Court’s prior ruling on the admissibility of outside counsel’s litigation strategy.
Accordingly, Defendant’s Motion in Limine is GRANTED in so far as it pertains to
Haberland’s supervision of outside counsel with respect to the filing of the Answer in
this case.
D.
Conclusion
The parties appear to agree that only one in-house attorney, John Haberland, will
be a witness in this case. The Court will permit Plaintiff to question Haberland regarding
his non-attorney duties, including his actions (if any) related to evaluating or adjusting
Plaintiff’s claim once it was assigned to him. The Court will not permit Plaintiff to
question Haberland regarding the actions of outside counsel and Haberland’s approval
or supervision of those actions.
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Dated this 13th day of September, 2011.
BY THE COURT:
William J. Martínez
United States District Judge
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