COMPTON v. ALLSTATE PROPERTY & CASUALTY INSURANCE COMPANY

Filing 51

ORDER granting IN PART Deft's 47 Motion for Reconsideration (See Order for details). Signed by Magistrate Judge Debra McVicker Lynch on 1/25/2012. (SWM)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION

JILL COMPTON,
Plaintiff,
v.
ALLSTATE PROPERTY & CASUALTY
INSURANCE COMPANY,
Defendant.

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) CASE NO. 1:10-cv-01448-LJM-DML
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Order On Defendant’s Motion to Reconsider
Defendant Allstate Property & Casualty Insurance Company (“Allstate”) asks the court to
reconsider its Order Following In Camera Review, entered December 13, 2011 (Dkt. 41), with
respect to one matter: whether Allstate should be permitted to redact from the NextGen record
reserve information that Allstate contends on reconsideration is not relevant. (Dkt. 47). Plaintiff
Jill Compton opposes Allstate’s motion and asserts that the reserve information is relevant to her
allegation that Allstate acted in bad faith in denying her claim. (See Dkt. 49 at pp. 2 and 3).
Ms. Compton states: “Whether Allstate put aside a reserve in a case, and when, could
evidence bad faith on the part of the insurance company.” (Dkt. 49 at p. 4). She explains her
relevance theory by contrasting it with an argument addressed by the Supreme Court of Colorado
in Silva v. Basin Western, Inc., 47 P.3d 1184 (Colo. 2002), in which the plaintiff suing an insured
sought disclosure of the amount of reserves the defendant’s insurer had set aside for the claim.
Ms. Compton states that the issue in Silva was disclosure of the amount of reserves, not whether
money was “even set aside” by the insurer, and she seeks “to know if reserves were initially set

aside to go towards [her] complaint that the Defendant acted in bad faith and breached the
contract.” (Dkt. 49 at p. 4).
Allstate’s reply brief states that the precise information that Ms. Compton contends is
relevant—whether reserves were set at all—can be provided while still protecting the
information that Allstate contends is not relevant to any issue—information relating to actual
reserve amounts or values. Allstate suggests that the court, based on its in camera review,
should simply provide Ms. Compton with the assurance that reserves were set. (Dkt. 50 at 1-2).
The court declines to perform that role in the discovery process, but agrees with Allstate that Ms.
Compton has argued only that information about when and whether “reserves were initially set
aside” is relevant and has not suggested that reserve amounts are relevant to her claims.1
The court therefore upholds Allstate’s objection to revealing within the NextGen record
information related to the actual reserve amounts or values. Allstate may redact from the
NextGen record all references to actual reserve amounts or values, although Allstate must reveal
wording within the NextGen record denoting the fact of setting a reserve. For example, for the
entry dated November 17, 2009 at 8:33 AM, Allstate may redact the dollar figure but not the
words “Set reserve at.”

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Relevance is a case-specific inquiry. See Fed. R. Evid. 401. Thus, the court can agree
with Ms. Compton that reserves information can be relevant to a bad faith claim and with
Allstate that reserves information can be irrelevant to insurance coverage and bad faith disputes
(and that the information is likely always irrelevant in the third-party context such as that
addressed in Shierenberg v. Howell-Baldwin, 571 N.E.2d 335 (Ind. Ct. App. 1991)). But the
issue for this court is whether and how the information may illuminate—or lead to evidence that
may illuminate—whether Allstate breached any duty to Ms. Compton in its handling and
ultimate denial of the claim. As noted above, Ms. Compton has not argued that the actual reserve
amounts are relevant to any of her claims and contends only that whether reserves were initially
set aside is relevant.
2

Conclusion
Allstate’s motion to reconsider (Dkt. 47) is GRANTED in PART. Allstate may redact
from the NextGen record all information related to the actual reserve amounts or values.
So ORDERED.
Dated: 01/25/2012
________________

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Debra McVicker Lynch
United States Magistrate Judge
Southern District of Indiana

Distribution to all counsel of record via CM/ECF

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