Villas Townhouse Association, The v. American Family Insurance Group

Filing 79

ORDER granting in part and denying in part 72 Defendant American Family Mutual Insurance Company's Motion for Protective Order Regarding Fed. R. Civ. P. 30(b)(6) Deposition of American Family, as set forth in the Order, by Magistrate Judge Michael J. Watanabe on 4/24/2014.(emill)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 13-cv-01920-REB-MJW

THE VILLAS TOWNHOUSE ASSOCIATION
a/k/a VILLAS WEST TOWNHOUSE ASSOCIATION (VTA), and
JOHN DOE AND JANE DOE as intended beneficiaries,
Plaintiff(s),
v.
AMERICAN FAMILY GROUP
d/b/a AMERICAN FAMILY MUTUAL INSURANCE COMPANY,
Defendant(s).

ORDER REGARDING
DEFENDANT AMERICAN FAMILY MUTUAL INSURANCE COMPANY’S MOTION
FOR PROTECTIVE ORDER REGARDING FED. R. CIV. P. 30(B)(6) DEPOSITION OF
AMERICAN FAMILY (DOCKET NO. 72)

Entered by Magistrate Judge Michael J. Watanabe

This matter is before the court on Defendant American Family Mutual Insurance
Company’s Motion for Protective Order Regarding Fed. R. Civ. P. 30(b)(6) Deposition of
American Family (docket no. 72). The court has reviewed the subject motion (docket
no. 72) and the response (docket no. 75). In addition, the court has taken judicial notice
of the court’s file and has considered applicable Federal Rules of Civil Procedure and
case law. The court now being fully informed makes the following findings of fact,
conclusions of law, and order.

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FINDINGS OF FACT AND CONCLUSIONS OF LAW
The court finds:

1.

That I have jurisdiction over the subject matter and over the parties
to this lawsuit;

2.

That venue is proper in the state and District of Colorado;

3.

That each party has been given a fair and adequate opportunity to
be heard;

4.

That Defendant contends in the subject motion (docket no. 72) that
a protective order should be issued by this court because Plaintiff’s
Fed. R. Civ. P. 30(b)(6) Notice and disputed Topics 1-15, inclusive,
are so broad in scope as to provide Defendant with little to no
meaningful guidance on what testimony is desired, so that
Defendant is unable to determine appropriate designees for those
disputed Topics, much less prepare witnesses for depositions. In
addition, any reasonably thorough inquiry into the proposed
disputed Topics would require not just numerous company
representatives, but also days - not hours - to complete.
Accordingly, Defendant argues that the Notice is per se
unreasonable and overly burdensome under EEOC v. Vail Corp.,
2008 WL 5104811, *1 (D. Colo. Dec. 3, 2008) (finding estimates
that deposition testimony would span far more than the allotted
seven hours “supports the contention that the proposed Rule

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30(b)(6) deposition is both unduly broad and burdensome” and
granting protective order). Further, Defendant argues that the
burden and expense to Defendant to produce a person
knowledgeable on these disputed Topics greatly exceeds any
benefit that could be derived therefrom, especially since the
information may be sought through other means that would be far
more convenient, less burdensome, and less expensive.
Accordingly, Defendant requests that this court enter a protective
order not allowing Plaintiff to inquire into Topics 1-15, inclusive,
during the Rule 30(b)(6) deposition and not requiring Defendant to
provide to Plaintiffs documents sought through the Plaintiff’s Notice;
5.

That Plaintiff contends that the disputed Topics 1-15, inclusive, of
inquiry attached to their Fed. R. Civ. P. 30(b)(6) Notice are relevant
to their statutory bad faith claim based on Defendant’s violation of
§§10-3-1115 and 1116, C.R.S., and their common law bad faith
claim based on Defendant’s breach of the implied duty of good faith
and fair dealing, and such disputed Topics are reasonably limited in
scope and duration. Plaintiff further contends that the Notice and
disputed Topics do not subject Defendant to an “impossible task” in
terms of identifying the outer limits of the areas of inquiry noticed
and designating a representative in compliance with the Notice.
Accordingly, Plaintiff requests that this court deny Defendant’s the
subject motion (docket no. 72);

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6.

That as to Topic #1, the Defendant objects to Topic #1 as being
overly broad, unduly burdensome, and seeks irrelevant information.
Defendant further argues that Topic #1 seeks information not
reasonably calculated to lead to the discovery of admissible
evidence. I find Defendant’s objections to Topic #1 are overruled.
See Jeffryes v. Harford Life & Acc. Ins. Co., 2006 WL 1186493 (D.
Colo. May 4, 2006). Also, I find that Plaintiff has narrowed Topic #1
as outlined in Plaintiff’s Response (docket no. 75) at page 7 to only
those portions of the Policy that are at issue in this case, including
sections on coverage, exclusions, and the terms and conditions for
obtaining the Replacement Cost Value (“RCV”) payment in the
event of a hail loss;

7.

That as to Topic #2, the Defendant objects to Topic #2 as being
overly broad, unduly burdensome, and seeks irrelevant information.
I find that Defendant’s Objections to Topic #2 are overruled.
Defendant has asserted a defense in this case that the sheathing is
not covered as a result of the Policy’s “wear and tear exclusion”
because the sheathing was deteriorated prior to the Loss and was
not directly damaged by hail. Further, Topic #2 is narrowly
confined to the results of Defendant’s inspection of the insured
premises;

8.

That as to Topic #3, the Defendant objects to Topic #3 as being

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overly broad in temporal scope, unduly burdensome, seeks
confidential information, and is not stated with reasonable
particularity. Defendant further argues that Topic #3 seeks
irrelevant information and is vague and ambiguous. Lastly,
Defendant argues that Topic #3 should be restricted to Defendant’s
handling policies and procedures that were effective during the
relevant claims handling period which is from December 5, 2011,
until the lawsuit was filed on June 25, 2013. I find that Defendant’s
Objections to Topic #3 are overruled, however, the time period
should be limited to January 1, 2010, through December 31, 2012,
inclusive. See Jeffryes, supra;
9.

That as to Topic #4, the Defendant objects to Topic #4 as being
overly broad in temporal scope, unduly burdensome, seeks
confidential information, and is not stated with reasonable
particularity. Defendant further argues that Topic #4 seeks
irrelevant information and is vague and ambiguous. Lastly,
Defendant argues that Topic #4 should be restricted to Defendant’s
handling policies and procedures that were effective during the
relevant claims handling period which is from December 5, 2011,
until the lawsuit was filed on June 25, 2013. I find that Defendant’s
Objections to Topic #4 are overruled, however, the time period
should be limited to January 1, 2010, through December 31, 2012,

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inclusive. See Jeffryes, supra;
10.

That as to Topic #5, the Defendant objects to Topic #5 as being
overly broad in temporal scope, unduly burdensome, seeks
confidential information, contains compound and multiple subparts,
is not reasonably calculated to lead to the discovery of admissible
evidence, and the information requested is not relevant to Plaintiff’s
claims, and Plaintiff cannot demonstrate a compelling need for this
information. Defendant further argues that Topic #5 should be
stricken in its entirety. I find Defendant’s Objections to Topic #5 are
overruled. The requested testimony in Topic #5 is relevant to the
statutory and common law bad faith claims and are also relevant as
to impeachment. See Porter v. Farmers Ins. Co., 2011 WL
1566018 (N.D. Okla. Apr. 25, 2011). However, the time period
should be limited to January 1, 2010, through December 31, 2012;

11.

That as to Topic #6, the Defendant objects to Topic #6 as being
overly broad in temporal scope, geographically, and in types of
material sought, is overly broad in time frame of five years, unduly
burdensome, seeks irrelevant information and is vague and
ambiguous, contains compound and multiple subparts, is not
reasonably calculated to lead to the discovery of admissible
evidence, and the information requested is not relevant to Plaintiff’s
claims. Defendant further argues that Topic #6 should be stricken in
its entirety. I find that Defendant’s Objections to Topic #6 are

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overruled. The requested testimony in Topic #6 is relevant
concerning the mechanisms by which Defendant monitors and
implements programs designed to reduce or to limit payments of
claims. See Lillibridge v. Nautilus Ins. Co., 2013 WL 1896825
(D.S.D. May 3, 2013). However, the time period should be limited
to January 1, 2010, through December 31, 2012;
12.

That as to Topic #7, the Defendant objects to Topic #7 as being
overly broad in temporal scope, geographically, and in types of
material sought, is overly broad in time frame of five years, unduly
burdensome, seeks irrelevant information and is vague and
ambiguous, contains compound and multiple subparts, is not
reasonably calculated to lead to the discovery of admissible
evidence, and the information requested is not relevant to Plaintiff’s
claims. Defendant further argues that Topic #7 should be stricken
in its entirety. I find that Defendant’s Objections to Topic #7 are
overruled. The testimony being sought in Topic #7 is relevant on
the issues of: (1) whether the financial rewards programs designed
to lower Defendant’s combined ratio improperly motivated
Defendant’s adjusters to deny claims without a good faith basis for
doing so; (2) whether Mr. Miller’s opinions as outlined in docket no.
57, exhibit D, are correct or in error; and (3) whether Defendant’s
conduct in handling the Plaintiffs’ claim was reasonable under the

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Colorado Unfair Practices Act. See § 10-3-1104(h)(II)(III), C.R.S.
However, the time period should be limited to January 1, 2010,
through December 31, 2012;
13.

That as to Topic #8, the Defendant objects to Topic #8 as being
overly broad in temporal scope, geographically, and in types of
material sought, is overly broad in time frame of five years, unduly
burdensome, seeks irrelevant information and is vague and
ambiguous, contains compound and multiple subparts, is not
reasonably calculated to lead to the discovery of admissible
evidence, and the information requested is not relevant to Plaintiff’s
claims. Further, Defendant argues that Plaintiff cannot
demonstrate a compelling need for this information. Lastly,
Defendant argues that Topic #8 should be stricken in its entirety. I
find that Defendant’s Objections to Topic #8 are overruled. See
Eberlein v. Provident Life & Acc. Ins. Co., No. 06-cv-02454-PABMJW, 2009 WL 353516 (D. Colo. Feb. 12, 2009) (finding that, for
bad faith cause of action, an insurer’s pattern of conduct as
evidenced by market conduct reports was relevant to the question
of how the defendant acted in a particular case). However, the time
period should be limited to January 1, 2010, through December 31,
2012;

14.

That as to Topic #9, the Defendant objects to Topic #9 as being
overly broad, unduly burdensome, seeks information which is

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private and confidential, seeks information that is not reasonably
calculated to lead to the discovery of admissible evidence, and
seeks information that is not relevant to Plaintiff’s claims. Defendant
further argues that Topic #9 should be stricken in its entirety. I find
that Defendant’s Objections to Topic #9 are overruled. See Vining
v. Enterprise Fin. Group, Inc., 148 F.3d 1206, 1218 (10th Cir. 1998)
(finding that “a pervasive consistent pattern” of conduct is clearly
relevant as habit evidence under Federal Rule of Evidence 406);
15.

That as to Topic #10, the Defendant objects to Topic #10 as being
overly broad in temporal scope, geographically, and in types of
material sought, unduly burdensome, seeks irrelevant information,
is vague and ambiguous, and the information requested has no
geographical limitation. Lastly, Defendant argues that Topic #10
should be stricken in its entirety. I find that Defendant’s Objections
to Topic 10 are overruled. However, the time period for Topic #10
should be limited to January 1, 2010, through December 31, 2012,
and the geographical area for Topic #10 should be limited to the
states of Colorado, Wyoming, Utah, New Mexico, Kansas, and
Oklahoma;

16.

That as to Topic #11, the Defendant objects to Topic #11 as being
overly broad in temporal scope, geographically, and in types of
material sought, unduly burdensome, seeks irrelevant information,

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is vague and ambiguous, and the information requested has no
geographical limitation. Further, Defendant argues that the claim in
this case did not involve any catastrophe response. Lastly,
Defendant argues that Topic #11 should be stricken in its entirety. I
find that Defendant’s Objections to Topic #11 are overruled but
with limitation. The court will allow Plaintiff to ask the Rule
30(b)(6) witness the following initial question: Whether American
Family’s Catastrophe Response Program was implicated in its
handling of the Villas’ claim? If the Rule 30(b)(6) witness answers
no to this question, then no further inquiry will be permitted. If the
Rule 30(b)(6) answers yes, then additional questioning concerning
Topic #11 may occur;
17.

That as to Topic #12, the Defendant objects to Topic #12 as being
overly broad in temporal scope, geographically, and in types of
material sought, is overly broad in time frame of five years, unduly
burdensome, seeks irrelevant information, is vague and
ambiguous, contains compound and multiple subparts, and the
information requested is not relevant to Plaintiff’s claims. Further,
Defendant argues that the claim in this case does not involve the
Appraisal process and also does not involve any reinsurance.
Lastly, Defendant argues that Topic #12 should be stricken in its
entirety. I find that Defendant’s Objections to Topic #12 are

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sustained. The subject claim in the lawsuit does not involve the
Appraisal process and also does not involve any reinsurance;
18.

That as to Topic #13, the Defendant objects to Topic #13 as being
overly broad in temporal scope, geographically, and in types of
material sought, unduly burdensome, seeks irrelevant information
that is confidential, seeks information that is vague, ambiguous,
compound and contains multiple subparts, and the information
requested is not relevant to Plaintiff’s claims. Further, Defendant
argues that Plaintiff’s claims do not involve errors and omissions,
and Defendant’s corporate liability insurance coverage is not
relevant to Plaintiffs’ claims. See Leidholt v. Dist. Court in and for
City and County of Denver, 619 P.2d 768, 771 (Colo. 1980). Lastly,
Defendant argues that Topic #13 should be stricken in its entirety. I
find that Defendant’s Objections to Topic #13 are sustained. The
subject claim does not involve errors and omissions, and
Defendant’s corporate liability insurance coverage is not relevant to
Plaintiff’s claims;

19.

That as to Topic #14, the Defendant objects to Topic #14 as being
overly broad in temporal scope, geographically, and in types of
material sought, unduly burdensome, seeks irrelevant information,
is vague and ambiguous, and the information requested is
confidential and not relevant to Plaintiff’s claims. Further,

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Defendant argues that it does not track compensation paid to
vendors, consultants, and experts. Lastly, Defendant argues that
Topic #14 should be stricken in its entirety. I find that Defendant’s
Objections to Topic #14 are sustained. I further find that Topic #14
is overly board and unduly burdensome; and
20.

That as to Topic #15, the Defendant objects to Topic #15 as being
overly broad in temporal scope, geographically, and in types of
material sought, unduly burdensome, seeks irrelevant information,
is vague and ambiguous, and the information requested is not
relevant to Plaintiff’s claims. Further, Defendant argues that
testimony pertaining to the corporate incentive program has no
relationship to whether Defendant acted as a reasonable insurer
would under the given circumstances. Lastly, Defendant argues
that Topic #15 should be stricken in its entirety. I find that
Defendant’s Objections to Topic #15 are overruled since the
testimony sought in Topic #15 is relevant as to the bad faith claims
and on the issue of financial motivation. However, the time period
for Topic #15 should be limited to January 1, 2010, through
December 31, 2012, and the geographical area for Topic #15
should be limited to the states of Colorado, Wyoming, Utah, New
Mexico, Kansas, and Oklahoma.
ORDER

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WHEREFORE, based upon these findings of fact and conclusions of law this
court ORDERS:
1.

That Defendant American Family Mutual Insurance Company’s
Motion for Protective Order Regarding Fed. R. Civ. P. 30(b)(6)
Deposition of American Family (docket no. 72) is GRANTED IN
PART AND DENIED IN PART:
a.

The subject motion (docket no. 72) is GRANTED as
to Topics 12, 13, and 14;

b.

The subject motion (docket no. 72) is DENIED as to
Topics 1 through 11, inclusive, and Topic15.
However, limitation as to questioning of the Rule
30(b)(6) witness concerning the relevant time period,
limitation as geography area, and other limitations
and/or required procedures for each of the Topics 1
through 11, inclusive, and Topic 15 are more fully
outlined, with particularity, above within the body of
this Order. The parties shall follow these limitations
during the Rule 30(b)(6) deposition; and

c.

That on or before May 6, 2014, Defendant shall
provide to Plaintiff those documents that in Docket
No. 76 were ordered by this court to be produced; and

2.

That each party shall pay their own attorney fees and costs for this

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motion.
Done this 24nd day of April 2014.
BY THE COURT
s/Michael J. Watanabe
MICHAEL J. WATANABE
U.S. MAGISTRATE JUDGE