Ball v. USAA Life Insurance Company
Filing
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ORDER granting 29 Motion for Reconsideration re 24 Order on Motion to Compel. Signed by Honorable David C Norton on February 13, 2017. (rweh, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
CHARLESTON DIVISION
CHERYL BALL, individually and on
behalf of the ESTATE OF JAMES
MICHAEL BALL,
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Plaintiff,
vs.
USAA LIFE INSURANCE COMPANY,
Defendant.
No. 2:16-cv-00041-DCN
ORDER
This matter is before the court on defendant USAA Life Insurance Company’s
(“USAA”) motion for reconsideration of the court’s May 16, 2016 order granting in
part and denying in part plaintiff Cheryl Ball’s (“plaintiff”) motion to compel. ECF
No. 29. For the reasons set forth below, the court grants USAA’s motion.
I. BACKGROUND
Plaintiff alleges that her husband, James Michael Ball (“Ball”), served in the
Army for 27 years prior to retiring from active duty. Compl. ¶ 4. Ball applied for life
insurance with USAA on April 17, 2012 and obtained two life insurance policies on
May 20, 2012. Id. ¶ 5. On December 13, 2013, Ball was killed in a hit and run motor
vehicle accident, and the cause of death was listed as blunt force injuries to the head
after being ejected from a motorcycle. Id. ¶ 6. After Ball’s death, plaintiff submitted
a claim for life insurance benefits. Id. ¶ 7. Plaintiff alleges that USAA denied her
claim on November 24, 2014. Id. The plaintiff filed her complaint on October 27,
2015 in the Court of Common Pleas for Dorchester County, bringing the following
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causes of action: (1) breach of contract; (2) insurance bad faith; and (3) attorney’s
fees pursuant to South Carolina Code § 38-59-40. USAA filed a notice of removal on
January 7, 2016.
On February 19, 2016, plaintiff filed a motion to compel USAA to submit full
and complete responses to various interrogatories and requests for production. ECF
No. 10. The instant motion concerns plaintiff’s Request for Production 9, which
seeks:
Clear, legible copies of USAA Life Insurance Company’s advertising
and promotional materials regarding life insurance coverage which
were used in the calendar years 2009 through 2014.
ECF No. 10-1 at 3. USAA argued that such materials were irrelevant because they
had no bearing on plaintiff’s entitlement to life insurance benefits or the
reasonableness of USAA’s decision to deny those benefits. ECF No. 13 at 5. On
May 16, 2016, the court issued an order granting plaintiff’s motion to compel with
respect to Request for Production 9. ECF No. 24 at 10–11. The court determined
that Request for Production 9 was “relevant to the [] bad faith claim and does not
appear unduly burdensome.” Id. at 11. However, the court limited its holding to
advertising and promotional materials used in South Carolina from 2009 until 2012
(the “Marketing Materials”), explaining that because Ball purchased his life insurance
policies in 2012, “advertising materials [used] after 2012 have no relevance in this
case.” Id.
On June 13, 2016, USAA filed the instant motion to reconsider the court’s
May 16, 2016 order pursuant to Federal Rule of Civil Procedure 54(b). ECF No. 29.
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Plaintiff filed a response on June 30, 2016. ECF No. 35. The motion is now ripe for
the court’s review.
II. STANDARD
Pursuant to Rule 54(b),
any order or other decision, however designated, that adjudicates
fewer than all the claims or the rights and liabilities of fewer than all
the parties does not end the action as to any of the claims or parties
and may be revised at any time before the entry of a judgment
adjudicating all the claims and all the parties’ rights and liabilities.1
“While the precise standard governing motions to reconsider an interlocutory order is
unclear, the Fourth Circuit has stated that Rule 54(b) motions are ‘not subject to the
strict standards applicable to motions for reconsideration of a final judgment.’”
Regan v. City of Charleston, S.C., 40 F. Supp. 3d 698, 701 (D.S.C. 2014) (quoting
Am. Canoe Ass’n v. Murphy Farms, Inc., 326 F.3d 505, 514 (4th Cir. 2003)).
Nevertheless, “the [c]ourt should grant a Rule 54 motion only under narrow
circumstances.” In re MI Windows & Doors, Inc. Prod. Liab. Litig., No. 2:12-cv01258-DCN, 2012 WL 5471862, at *2 (D.S.C. Nov. 9, 2012) (quoting Bailey v. Polk
Cty., N.C., 2012 WL 122565, at *2 (W.D.N.C. Jan. 17, 2012)). Courts in this circuit
have looked to the standards governing Rule 59(e) for guidance. Broadvox-CLEC,
LLC v. AT & T Corp., 98 F. Supp. 3d 839, 850 (D. Md. 2015); Regan, 40 F. Supp. 3d
at 702. “Therefore, reconsideration under Rule 54 is appropriate on the following
grounds: (1) to follow an intervening change in controlling law; (2) on account of
new evidence; or (3) to correct a clear error of law or prevent manifest injustice.”
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Rule 54(b) also provides an exception to this rule, which empowers a court
to enter a final judgment on “one or more, but fewer than all, claims or parties,” if the
court “expressly determines that there is no just reason for delay.”
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Ashmore v. Williams, No. 8:15-cv-03633, 2017 WL 24255, at *2 (D.S.C. Jan. 3,
2017).
III. DISCUSSION
USAA argues that the court should reconsider its May 16, 2016 order to the
extent it compelled USAA to produce the Marketing Materials because collection of
such materials has proven to be unduly burdensome, and the bulk of such materials
are not relevant to plaintiff’s claims. Def.’s Mot. 3–6. USAA has identified 5
specific Marketing Materials that were sent directly to plaintiff or Ball, and a
significant number of separate Marketing Materials that were sent to other USAA
members in South Carolina during the relevant period (the “Third-Party Marketing
Materials”). Id. at 1–2. USAA’s Marketing Compliance Director, Jennifer
Vandeveer (“Vandeveer”),2 has submitted an affidavit explaining that producing these
Third-Party Marketing Materials would require USAA to hire and train employees to
access information stored on its “legacy system,” and commit approximately 400
hours of labor time to manually collecting such materials. Id. at 4. USAA takes the
position that the Third-Party Marketing Materials are not relevant to plaintiff’s claims
because the materials contained therein were never sent to plaintiff or Ball.3 Id. at 4–
5. Plaintiff argues that the Third-Party Marketing Materials are relevant to show
USAA’s pattern of initiating contact with prospective applicants. Pl.’s Resp. 1–2.
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Vandeveer’s affidavit has been filed under seal.
USAA also offers an argument that such materials are irrelevant regardless
of whether they were sent to plaintiff or Ball. Def.’s Mot. 4–5. Because this
argument either was, or should have been, presented in the briefing on plaintiff’s
motion to compel, it warrants no consideration at this stage. Moreover, USAA does
not even ask the court to reconsider its order with respect to the Marketing Materials
that were sent directly to plaintiff or Ball.
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At the outset, the court observes that plaintiff has failed to articulate a precise
argument for why the Third-Party Marketing Materials are relevant. It is of course
true that such materials would illuminate USAA’s “conduct in acquiring new
policyholders,” id. at 2, but plaintiff never explains how such conduct relates to her
claims. The court suspects there are some ways in which the Third-Party Marketing
Materials might be relevant. For instance, the Third-Party Marketing Materials may
reveal that USAA’s allegedly unreasonable conduct was part of a broader pattern,
which might indicate that USAA acted willfully, thereby impacting the punitive
damages inquiry.4 See Howard v. State Farm Mut. Auto. Ins. Co., 450 S.E.2d 582,
586 (S.C. 1994) (“Punitive damages may also be recovered if the plaintiff proves the
insurer’s conduct was willful or in reckless disregard of his or her rights under the
contract.”). However, the court is not inclined to compel 400 hours worth of
discovery simply because it can imagine some ways in which such discovery might
be relevant in some cases. “[A] party may not merely assert that requested materials
may lead to the discovery of admissible evidence without presenting any intelligible
explanation of how that is so.” J & J Sports Prods., Inc. v. Wofford, No. 6:13-cv02403, 2014 WL 2980250, at *2 (D.S.C. June 30, 2014). Plaintiff’s failure to provide
a cogent explanation of what it expects—or at least hopes—to learn from the ThirdParty Marketing Materials leads this court to conclude that plaintiff’s request is
something of a fishing expedition, which is inappropriate under Rule 26. Mohammed
v. Daniels, 2015 WL 4758968, at *2 (E.D.N.C. Aug. 12, 2015).
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Of course, plaintiff would have to explain how USAA’s marketing efforts
were part of this pattern, which it has not done.
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Moreover, the court’s May 16, 2016 order clearly took the position that the
Marketing Materials were relevant because either plaintiff or Ball might have actually
encountered them. If the court had viewed the Marketing Materials as relevant
regardless of whether plaintiff or Ball actually saw them, there would have been little
reason to restrict plaintiff’s Request for Production to materials used in South
Carolina before Ball purchased the policies at issue in this case. See ECF No. 24 at
11 (“Although the information sought is relevant, Mr. Ball purchased the life
insurance policy in 2012. As such, advertising materials after 2012 have no relevance
in this case.”). The court’s citation to Williamson v. Liberty Mut. Fire Ins. Co., 2015
WL 8489980, at *3 (S.D.W. Va. Dec. 9, 2015), supports the same conclusion. In
Williamson, the court found that a defendant-insurer’s sales and promotional
materials were relevant to show that the insurer “did not act in good faith and violated
representations made to [the] [p]laintiffs.” Id. (emphasis added). The Williamson
court also limited the plaintiffs’ discovery request to the years when the plaintiffs
renewed their policy, again suggesting that the sales and promotional materials were
only relevant to the extent they could have influenced the plaintiffs in that case. Id.
There can be little doubt that this court’s May 16, 2016 order was based on a similar
theory.
In light of these considerations, and USAA’s recent discovery that producing
the Third-Party Marketing Materials would entail substantial costs,5 the court
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The court cautions that, if it were not for USAA’s discovery that such a
small percentage of the Marketing Materials actually fit within the rationale
underlying the court’s May 16, 2016 order, the result may well have been different.
The court would be far less inclined to grant USAA’s motion if USAA’s only
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concludes that reconsideration is appropriate. The Marketing Materials that actually
reached plaintiff and Ball are certainly more relevant than the Third-Party Marketing
Materials. While the court does not foreclose the possibility that the Third-Party
Marketing Materials might possibly be relevant for some purpose, plaintiff has failed
to provide anything more than a conclusory argument as to what that purpose would
be. Therefore the court reconsiders its May 16, 2016 order and denies plaintiff’s
February 19, 2016 motion to compel with respect to the Third-Party Marketing
Materials. However, to the extent it is possible for USAA to provide some reasonable
indication of the content of the Third-Party Marketing Materials without engaging in
the efforts outlined in Vandeveer’s affidavit, they must do so.6
argument was that production of the Marketing Materials would require 400 hours of
discovery. Such information could have been presented in USAA’s response to
plaintiff’s original motion to compel.
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Plaintiff argues that USAA is “fully capable” of providing such information.
However, the court is not convinced that this is so clear—the Vandeveer affidavit
does not indicate exactly what information USAA can gather without going through
the effort to access the Third-Party Marketing Materials from the “legacy system.”
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IV. CONCLUSION
For the reasons set forth above, the court RECONSIDERS its May 16, 2016
order as it relates to plaintiff’s Request for Production 9. On reconsideration, the
court GRANTS plaintiff’s February 19, 2016 motion to compel with respect to those
Marketing Materials that were sent directly to plaintiff or Ball. The court DENIES
plaintiff’s February 19, 2016 motion to compel with respect to the Third-Party
Marketing Materials, except that USAA shall provide a reasonable description of the
contents of such materials to the extent it can do so without retrieving those materials
from the “legacy system.”
AND IT IS SO ORDERED.
DAVID C. NORTON
UNITED STATES DISTRICT JUDGE
February 13, 2017
Charleston, South Carolina
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