R.W. et al v. Liberty Mutual Fire Insurance Company

Filing 42

ORDER granting in part and denying in part plaintiffs' 16 Motion to Compel by Judge Richard A Jones.(RS)

HONORABLE RICHARD A. JONES

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

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R.W. and R.J.T.,
Plaintiffs,

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Case No. C16-465 RAJ

v.

ORDER

LIBERTY MUTUAL FIRE INSURANCE
COMPANY,

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Defendant.

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I. INTRODUCTION

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This matter comes before the Court on Plaintiffs R.W. and R.J.T.’s Motion to
Compel. Dkt. # 16. For the reasons that follow, the Court GRANTS in part and
DENIES in part Plaintiffs’ motion.
II. BACKGROUND

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In this discovery dispute, Plaintiffs seek the production of documents reflecting
the relationship between Defendant Liberty Mutual Fire Insurance Company (“Liberty”)
and Rainbow International (“Rainbow”), a contractor whom Liberty hired to remediate a
leaking dishwasher in Plaintiffs’ home. In Plaintiffs’ view, these documents are relevant
because Rainbow, under the control of Liberty, failed to mitigate the damage to their
home. Dkt. # 16 at 2. Liberty resisted disclosing these documents because of a
confidentiality agreement with Rainbow that limits the disclosure of certain information
to third parties. Id. at 1. According to Plaintiffs, Liberty agreed to produce the
ORDER – 1

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documents if they agreed to sign a stipulated confidentiality order and to “allow certain
sensitive information to be redacted if it was irrelevant to Plaintiffs’ case.” Id. at 2.
Although they “agreed” and “signed that stipulated protective order,” Liberty still
declined to produce the documents. Id. The parties disagree as to Liberty’s rationale for
withholding the documents. The record, however, indicates that Liberty was still in the
process of securing Rainbow’s approval to disclose. Dkt. # 20 at 3.
Since Plaintiffs filed the instant motion, Liberty has produced documents within
the scope of Plaintiffs’ request. Dkt. # 20-1 at 8. These documents contain redactions
that conceal (1) pricing information about the service contract between Liberty and
Rainbow and (2) information about the remedies available to Liberty in the event that
Rainbow fails to properly perform its duties under the contract. Dkt. # 25 at 2-3.
Now, in their reply brief, Plaintiffs contend that Liberty should be compelled to
produce unredacted copies of the responsive documents. They maintain that the
concealed information will support their argument that Rainbow performed substandard
work as a consequence of charging reduced prices and facing lesser repercussions due to
Liberty’s limited contractual remedies. Id.
III.

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LEGAL STANDARD

The Court has broad discretion to control discovery. Avila v. Willits Envtl.
Remediation Trust, 633 F.3d 828, 833 (9th Cir. 2011). The legal basis for a motion to
compel the production of documents is Rule 37 of the Federal Rules of Civil Procedure.
Under Rule 37, “If the motion is granted—or if the disclosure or requested discovery is
provided after the motion was filed—the court must, after giving an opportunity to be
heard, require the party or deponent whose conduct necessitated the motion, the party or
attorney advising that conduct, or both to pay the movant’s reasonable expenses incurred
in making the motion, including attorney’s fees.” Fed. R. Civ. P. 37(a)(5)(A). But the
Court is precluded from awarding expenses if: “(i) the movant filed the motion before
attempting in good faith to obtain the disclosure or discovery without court action; (ii) the
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opposing party’s nondisclosure, response, or objection was substantially justified; or (iii)
other circumstances make an award of expenses unjust.” Id.
IV. DISCUSSION

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A.

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Plaintiffs contend that Liberty should be compelled to reproduce the documents in

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Redacted Information

their unredacted form. The problem with this argument is that they admit to having
agreed to receive redacted documents:

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Initially, Liberty Mutual’s counsel agreed the documents were discoverable
and that they would recommend their production. The only caveat was that
Liberty Mutual requested that Plaintiffs first sign a stipulated protective
order on confidentiality and allow certain sensitive information to be
redacted if it was irrelevant to Plaintiffs’ case. Plaintiffs agreed and signed
that stipulated protective order.

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Dkt. # 16 at 2. What Plaintiffs now dispute is Liberty’s contention that the redacted

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information is “irrelevant.” But Liberty has not had an opportunity to substantiate its

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claim of irrelevance because Plaintiffs’ raise this challenge in their reply brief. Dkt. # 19

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at 5. 1

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In its opposition brief, Liberty asserts that it should have the opportunity to discuss

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with Rainbow whether it will agree to the production of unredacted documents. The

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Court agrees. Accordingly, the Court orders Liberty to take the action it believes

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Plaintiffs have precluded it from taking by challenging the redactions in their reply brief.

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B.

Reasonable Expenses

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Because the documents were produced “after the motion was filed,” Plaintiffs

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contend that they are entitled to fees pursuant to Fed. R. Civ. P. 37(a)(5)(A). The Court,

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however, is precluded from awarding expenses in certain circumstances, including where

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a party’s nondisclosure was “substantially justified” or an award of expenses would be

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“unjust.” Id. Here, Liberty’s reason for delay in producing the documents was that they

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Nevertheless, Liberty’s apparent position, as evidenced by the parties’ recently-filed
joint status report, is that the redacted information cannot be produced because it is subject to a
confidentiality agreement with Rainbow. Dkt. # 41 at 1.

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are subject to a confidentiality agreement with Rainbow. Considering these
circumstances, the Court declines to award expenses.
V. CONCLUSION

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For the foregoing reasons, the Court GRANTS in part and DENIES in part
Plaintiffs’ motion. Within seven (7) days from the date of this Order, Liberty is
ORDERED to file a surreply addressing the issues it contends to have been precluded
from raising in its opposition.

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DATED this 17th day of January, 2017.

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A

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The Honorable Richard A. Jones
United States District Judge

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ORDER – 4