Addison Construction Corporation et al v. Nationwide Mutual Fire Insurance Company

Filing 174

ORDER denying 140 DeSantis' Motion to Compel Production of Documents. Signed by Magistrate Judge William Matthewman on 9/14/2020. See attached document for full details. (kza)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 9:13-cv-80971-Marra/Matthewman
Addison Construction Corp.,
Addison Development Corp.,
and Daniel E. Swanson,

KJZ

Plaintiffs,

Sep 14, 2020

v.
Nationwide Mutual Fire Ins. Co.
and Nationwide Mutual Ins. Co.,
Defendants.
____________________________________________/
Nationwide Mutual Fire Ins. Co.
and Nationwide Mutual Ins. Co.,
Counter-Plaintiffs/Third-Party Plaintiffs,
v.
Addison Construction Corp.,
Addison Development Corp.,
and Daniel E. Swanson,
Counter-Defendants,
Dean DeSantis and Laura DeSantis,
Third-Party Defendants.
____________________________________________/
Dean DeSantis and Laura DeSantis,
Intervenor Plaintiffs,
v.
Nationwide Mutual Fire Ins. Co.,
Defendant-in-Intervention.
____________________________________________/

West Palm Beach

ORDER DENYING THE DESANTIS’ MOTION TO COMPEL
PRODUCTION OF DOCUMENTS [DE 140]
THIS CAUSE is before the Court on the Plaintiffs in Intervention/Third-Party Defendants,
DeSantis’ Motion to Compel Production of Documents [DE 140]. Nationwide filed a Response in
Opposition [DE 142] and the DeSantises filed a Reply [DE 143]. Pursuant to Court Order, the
parties filed a Joint Notice on September 11, 2020 [DE 172]. This matter was referred to the
undersigned by United States District Judge Kenneth A. Marra. See DE 25. The Court held a
hearing via Zoom video teleconference on the Motions on September 14, 2020. At the conclusion
of the September 14, 2020 hearing, the Court orally denied the DeSantis’ Motion. This written
Order follows.
DISCUSSION
The parties represented in their Joint Notice [DE 172] that all discovery disputes raised in
the DeSantis’ Motion [DE 140] have been resolved except for five nearly identical Requests for
Production numbered 28 through 32. In those five requests for production, the DeSantises seek “the
complete underwriting file” for each relevant policy year (2004-2009).
Nationwide objects to producing the underwriting files, 1 arguing that this is only a coverage
action regarding the scope of its indemnity obligation for judgments entered in the underlying state
court construction defect lawsuit filed by the Vecellios against Addison Construction, Mr.
Swanson, and the DeSantises. Nationwide correctly asserts that no bad faith claim has been filed
against it in this action. Nationwide cites Diamond State Ins. Co. v. His House, Inc., 2011 WL
146837 (S.D. Fla. Jan. 18, 2011), for the proposition that an insured is generally not entitled to
evidence regarding its insurance company’s underwriting of the policy, and State Farm Mut. Auto.
Ins. Co. v. O'Hearn, 975 So. 2d 633 (Fla. 2d DCA 2008), for the proposition that an underwriting

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The Desantis’ five RFP’s numbered 28 through 32 and Nationwide’s identical objection to each are filed on the
docket at DE 140-2, pp. 11-12.

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file is not subject to discovery prior to a finding that the insurer has an obligation to provide
coverage.
In their argument regarding a previous discovery dispute, which resulted in the entry of this
Court’s Order Denying Nationwide’s Motion for a Protective Order [DE 128], the DeSantises
represented that they were not seeking any discovery into Nationwide’s claim handling or claim
file documents. [DE 128, p.5]. Further, in that Order, the Court narrowly held that the DeSantises
could inquire, at a deposition of Nationwide’s 30(b)(6) witness, into the terms and conditions that
Nationwide is relying upon to disclaim coverage, or reserve its rights to disclaim coverage, and the
facts supporting same; the facts supporting each and every of Nationwide’s affirmative defense;
the facts supporting the allegations in its various claims against Addison and the DeSantises; and,
the internal policies and procedures as they relate to Nationwide’s claims.[DE 128, p. 5].
The DeSantises now seek the “complete underwriting file” from Nationwide for each of the
five policy years. But, as Nationwide correctly points out, this is not a bad faith action; rather, it is
a coverage action regarding the scope of Nationwide’s indemnity obligations.
At the September 14, 2020 hearing, the DeSantises argued that they were entitled to the
underwriting files, or at least some portion of them, because of the issue of whether or not the
DeSantises are “additional insureds” under the policies. They argue that this case is distinguishable
from most cases dealing with this issue, because here, Nationwide is suing their insureds for
millions of dollars. Regarding proportionality, the DeSantises argued that these documents are
concise and are all held by Nationwide in one place.
After carefully considering the parties’ positions, and the applicable rules and law, the Court
finds that Nationwide’s underwriting files for each policy year sought by the DeSantises are not
relevant and proportional to the pending claims and defenses, pursuant to Federal Rule of Civil
Procedure 26(b)(1). See Ranger Constr. Indus., Inc. v. Allied World Nat'l Assurance Co., No. 17-

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81226-CIV, 2018 WL 2999691, at *1 (S.D. Fla. June 15, 2018) (denying a motion to compel
production of an insurer’s underwriting file because it “appear[s] to be solely relevant to Plaintiff’s
bad faith claim, which has been abated.”); see also 902 Evergreen, LLC v. Scottsdale Ins. Co., No.
9:18-CV-81153, 2019 WL 7905061, at *1 (S.D. Fla. Feb. 4, 2019) (rejecting “Plaintiff’s demand
for the entire underwriting file in this breach of contract case” as frivolous, and finding that “the
entire underwriting file is neither relevant nor proportional”); see generally Diamond State Ins. Co.
v. His House, Inc., 2011 WL 146837 (S.D. Fla. Jan. 18, 2011).
In the present case, the DeSantis’ overbroad requests for production 28 through 32 would
only uncover documents that would be relevant to a bad faith claim—but no bad faith claim has
been asserted in this case. Such requests do not seek relevant and proportional discovery in this
case. The DeSantises’ Motion [DE 140] cites absolutely no case law to support their argument that
the complete underwriting file (or any portion thereof) for each policy year is relevant and
proportional to the pending claims and defenses in this case. Further, even though Nationwide’s
Response specifically argues that the complete underwriting files are not subject to production
pursuant to Diamond State, supra, and O’Hearn, supra [DE 142, pp. 4-5, para. 1], the DeSantises’
Reply does not even address that issue or submit any case law whatsoever.
Moreover, the Court’s Order setting the hearing for Sept 14, 2020, also ordered the filing
of a Joint Notice in which the parties were to provide a brief recitation of the position of each party
as to any pending discovery dispute. But here, the Joint Notice filed by the parties merely stated
that RFP’s 28-32 remain at issue and did not provide a brief recitation of the parties’ positions. And
again, the DeSantises provided no case law support for its position in the Joint Notice.
Finally, the DeSantises submitted no case law at the September 14, 2020 hearing, whereas
Nationwide relied upon its previously submitted authorities and also submitted Bodo v. GeoVera
Specialty Ins. Comany (sic), No. 8:18-CV-678-T-30AAS, 2018 WL 6019200, at *2 (M.D. Fla. Nov.

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16, 2018) for the proposition that a party requesting an insurer’s underwriting file in a breach of
contract case must establish how the file is relevant to showing that the contract terms are
ambiguous. The DeSantises have not established how the underwriting files, or any portion thereof,
are relevant to show that the contract terms are ambiguous, or for any other purpose in this lawsuit.
The Court finds that Nationwide has properly supported its objections to requests for production
28 through 32, and those objections are due to be sustained.
Based on the foregoing, the DeSantis’ Motion to Compel Production of Documents [DE
140] as to the complete underwriting files for each of the five policy years is DENIED as such
discovery is irrelevant and disproportionate under Rule 26(b)(1). Further, the balance of the
DeSantis’ Motion [DE 140] is DENIED as MOOT based on the parties’ resolution of those
discovery disputes prior to the hearing per their Joint Notice [DE 172].
DONE and ORDERED in chambers at West Palm Beach, Palm Beach County,
Florida, this 14th day of September, 2020.
________________________________
WILLIAM MATTHEWMAN
United States Magistrate Judge

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