Terry v. Northrop Grumman Health Plan
MEMORANDUM OPINION AND ORDER conditionally denying 21 MOTION for Protective Order filed by Northrop Grumman Health Plan. The Plaintiff will be permitted to conduct limited discovery relating tothis breach of fiduciary duty claim, on ce the motion to dismiss isdecided, provided the motion to dismiss is not granted with respect tothis pending claim. Such discovery should be conducted within 60 daysof the resolution of the motion to dismiss and any such depositions shallbe conducted by video-conference to avoid undue disruption of thewitnesses lives and work schedules. Signed by Magistrate Judge Martin C. Carlson on September 14, 2012. (kjn )
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
ANNA MAE TERRY,
Civil No. 1:12-CV-263
(Magistrate Judge Carlson)
MEMORANDUM OPINION AND ORDER
Statement of Facts and of the Case
This is an action brought challenging the denial of benefits under ERISA.
(Doc. 1.) According to the Plaintiff’s complaint, “this is a claim for breach of
fiduciary duty and a claim of life insurance benefits.” (Id., ¶3.) The Defendant has
filed a motion to dismiss which seeks, inter alia, dismissal of the Plaintiff’s breach
of fiduciary duty claim. (Docs. 7-10.) That motion is pending before another
The parties are now embroiled in a discovery dispute relating to a limited
request for discovery by the Plaintiff, discovery which would relate solely to the
breach of fiduciary duty claim articulated by the Plaintiff in her complaint, and
challenged by the Defendant in its motion to dismiss. The gist of this breach of
fiduciary duty claim is that the Defendant breached a duty owed to the Plaintiff by
failing to provide the Plaintiff with timely notice and documentation to allow the
Plaintiff to effectuate conversion of these benefits when her spouse’s employment
was terminated. (Doc. 1, ¶¶19-20.) The Plaintiff wishes to undertake very limited
and targeted depositions to ascertain whether the Defendant had an obligation to
send such notice to Plaintiff, and to determine whether Defendant failed to fulfill this
duty. The Defendant has filed a motion for protective order seeking to prohibit or
narrowly tailor this discovery, which has been referred to the undersigned. (Docs. 2124.) This motion has been briefed by the parties and is ripe for resolution.
For the reasons set forth below the motion will be conditionally granted.
Several basic guiding principles inform our resolution of the instant discovery
dispute. At the outset, it is well-settled that rulings regarding the proper scope of
discovery, and the extent to which discovery may be compelled or prohibited, are
matters consigned to the court’s discretion and judgment. Wisniewski v. JohnsManville Corp., 812 F.2d 81, 90 (3d Cir. 1987). Thus, a court’s decisions regarding
the conduct of discovery will be disturbed only upon a showing of an abuse of
discretion. Marroquin-Manriquez v. I.N.S., 699 F.2d 129, 134 (3d Cir. 1983). This
far-reaching discretion extends to rulings by United States Magistrate Judges on
discovery matters. In this regard:
District courts provide magistrate judges with particularly broad
discretion in resolving discovery disputes. See Farmers & Merchs. Nat'l
Bank v. San Clemente Fin. Group Sec., Inc., 174 F.R.D. 572, 585
(D.N.J.1997). When a magistrate judge's decision involves a
discretionary [discovery] matter . . . , “courts in this district have
determined that the clearly erroneous standard implicitly becomes an
abuse of discretion standard.” Saldi v. Paul Revere Life Ins. Co., 224
F.R.D. 169, 174 (E.D.Pa.2004) (citing Scott Paper Co. v. United States,
943 F.Supp. 501, 502 (E.D.Pa.1996)). Under that standard, a magistrate
judge's discovery ruling “is entitled to great deference and is reversible
only for abuse of discretion.” Kresefky v. Panasonic Commc'ns and Sys.
Co., 169 F.R.D. 54, 64 (D.N.J.1996); see also Hasbrouck v.
BankAmerica Hous. Servs., 190 F.R.D. 42, 44-45 (N.D.N.Y.1999)
(holding that discovery rulings are reviewed under abuse of discretion
standard rather than de novo standard); EEOC v. Mr. Gold, Inc., 223
F.R.D. 100, 102 (E.D.N.Y.2004) (holding that a magistrate judge's
resolution of discovery disputes deserves substantial deference and
should be reversed only if there is an abuse of discretion).
Halsey v. Pfeiffer, No. 09-1138, 2010 WL 3735702, *1 (D.N.J. Sept. 17, 2010).
In ERISA litigation, claims regarding a breach of fiduciary duty may on
occasion entail disputed issues of fact. See Bixler v. Central Pennsylvania Teamsters
Health & Welfare Fund, 12 F.3d 1292 (3d Cir. 1993). Where disputed factual issues
define a breach of fiduciary duty claim, we believe that limited discovery pertaining
solely to the issues of breach of fiduciary duty may be appropriate. See e.g., Welch
v. Metro. Life Ins. Co., 480 F.3d 942, 949-950 (9th Cir.2007) (noting some discovery
aimed at demonstrating a conflict of interest may be appropriate in an ERISA action);
Fowler v. Aetna Life Ins. Co., 615 F. Supp. 2d 1130, 1135 (N.D. Cal. 2009).
Therefore, if Terry’s breach of fiduciary duty claim survives the pending motion to
dismiss, we conclude that the limited discovery sought by the Plaintiff may be
relevant, and appropriate, with respect to that claim. However, we also believe that
this discovery should await the resolution of this motion to dismiss.
These countervailing considerations guide our resolution of this discovery
dispute. For the foregoing reasons:
The Defendant’s motion for protective order will be DENIED,
The Plaintiff will be permitted to conduct limited discovery relating to
this breach of fiduciary duty claim, once the motion to dismiss is
decided, provided the motion to dismiss is not granted with respect to
this pending claim. Such discovery should be conducted within 60 days
of the resolution of the motion to dismiss and any such depositions shall
be conducted by video-conference to avoid undue disruption of the
witnesses’ lives and work schedules.
So ordered this 14th day of September 2012.
S/Martin C. Carlson
Martin C. Carlson
United States Magistrate Judge
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