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Elk City Golf and Country Club, Inc. v. Philadelphia Indemnity Insurance Co.

United States District Court, W.D. Oklahoma

December 26, 2019




         Currently pending before the Court for resolution is an outstanding issue raised by Plaintiff's Motion to Compel Discovery and Brief in Support [Doc. No. 43], regarding Defendant's failure to produce unredacted documents from its insurance claim file, based on claims of privilege for attorney-client communications and attorney work product. After a ruling by the Court [Doc. No. 98], Defendant submitted the documents at issue for in camera review. The documents are generally listed on Defendant's privilege log. See Pl.'s Mot. to Compel, Ex. 1 [Doc. No. 43-1].

         “The party seeking to assert a privilege has the burden of establishing its applicability.” Motley v. Marathon Oil Co., 71 F.3d 1547, 1550 (10th Cir. 1995). In this diversity case, Defendant's claim of attorney-client privilege is governed by Oklahoma law. Seneca Ins. Co. v. W. Claims, Inc., 774 F.3d 1272, 1275 (10th Cir. 2014); Fed.R.Evid. 501. Oklahoma has codified its legal rule regarding the attorney-client privilege, which protects “confidential communications made for the purpose of facilitating the rendition of professional legal services to the client.” Okla. Stat. tit. 12, § 2502(B). “‘[T]he mere fact that an attorney was involved in a communication does not automatically render the communication subject to the attorney-client privilege; rather, the ‘communication between a lawyer and client must relate to legal advice or strategy sought by the client.'” In re Grand Jury Proceedings, 616 F.3d 1172, 1182 (10th Cir. 2010) (quoting Motley, 71 F.3d at 1550-51; United States v. Johnston, 146 F.3d 787, 794 (10th Cir. 1998)).

         In all federal court litigation, attorney work product is governed by Rule 26(b)(3) of the Federal Rules of Civil Procedure. Frontier Ref., Inc. v. Gorman-Rupp Co., Inc., 136 F.3d 695, 702 n.10 (10th Cir. 1998) (“Unlike the attorney client privilege, the work product privilege is governed, even in diversity cases, by a uniform federal standard embodied in Fed.R.Civ.P. 26(b)(3).”) (internal quotation omitted). This rule generally protects from disclosure documents “prepared in anticipation of litigation or for trial” by a party's attorney or other representative. See Fed. R. Civ. P. 26(b)(3)(A). “Rule 26(b)(3) prevents discovery of an attorney's work product unless (1) the discovering party can demonstrate substantial need for the material and (2) the discovering party is unable to obtain the substantial equivalent of the material by other means without undue hardship.” Frontier Ref., 136 F.3d at 704 (footnote omitted). The rule provides additional protection for “the mental impressions, conclusions, opinions, or legal theories of a party's attorney or other representative concerning the litigation.” Fed.R.Civ.P. 26(b)(3)(B).

         With these legal principles in mind, the Court has reviewed the documents produced by Defendant in camera and finds that Defendant has failed to establish its claims of privilege with respect to most of the documents in question.

         Loss Reserves

         Many of the redacted documents relate to Defendant's loss reserves, which the Court found were discoverable in its November 15, 2019 Order [Doc. No. 98 at 5]. The redactions in the Claim Summary Report are a summary of pre-litigation communications among Defendant's claims specialist, claims supervisor, and assistant vice president noting changes to the reserves amount based on the investigation of Plaintiff's Claim. See PIIC CF 2-4, 6-12. Contrary to Defendant's assertion, the Claim Summary Report does not involve attorney-client communications, and aside from the first page, was prepared prior to litigation. The communications concern routine insurance business matters and are not the rendition of professional legal services. Most of these communications occurred early in Defendant's claim investigation process while it was still collecting documents and information.

         Although Defendant asserts that the Claim Summary Report is proprietary in nature, Defendant does not explain how it is proprietary and the Court is unable to draw that inference. Thus, the Claim Summary Report is discoverable. See PIIC CF 1-12. Likewise, PIIC CF 29-65, 272-75, 313-47, 1079-85, 1119-24, and 1201 involve email communications (pre-litigation) among Defendant's claims specialist, claims supervisor, general adjuster, and assistant vice president regarding the adequacy of the reserves amount and changes thereto. For the same reasons described supra, they are discoverable.

         The Claim Summary [PIIC CF 1358] references total reserves for prior claims by Plaintiff. The Court does not see the relevance of this document to Plaintiff's claims or to Defendant's defenses. Based on the Court's December 3, 2019 Order [Doc. No. 99 at 7- 8], in which the Court found that Defendant could not introduce evidence of Plaintiff's prior claims, the Court concludes that the Claim Summary [PIIC CF 1358] is not discoverable.


         A substantial part of the redacted documents relates to premiums; however, Defendant does not assert a specific objection in the privilege log. Further, in a separate motion pending before the Court, Plaintiff has indicated that it does not intend to comment or argue about the amount of premiums paid [Doc. No. 87 at 31] unless Defendant makes the matter relevant to an issue in the case. The premiums do not appear facially relevant, and Plaintiff bears the burden of establishing relevance. Thus, the Court finds they are not discoverable. See PIIC CF 179-83, 300-01, 506, 512-13, 516, 518-19, 527, 531-32, 533, 536, 540, 542, 836, 840-43, 846, 848-49, 857, 861-63, 866, 870, 872, 1359, 1362, 1365, 1423-25.

         Property Reports

         Defendant asserts that the property reports are work product, privileged, and proprietary in nature. PIIC CF 1585-91, 1800-06, 2065-66, 2071-73. The Court disagrees. The reports are prepared by Defendant's general adjusters for the benefit and approval of the claims examiner. They do not involve attorney-client communications and were prepared prior to litigation. The reports include an estimate of loss, an abstract of policy coverage, a summary of the adjusters' inspection and investigation, and payment recommendations. Further, Defendant does not explain how the reports are proprietary in nature, and the Court cannot draw that conclusion based on its review. Thus, the property reports are discoverable.

         Coverage ...

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