Opinion issued May 18, 2009
In The
Court of Appeals
For The
First District of Texas
NO. 01-09-00235-CV
IN RE STEADFAST INSURANCE COMPANY, Relator
Original Proceeding on Petition for Writ of Mandamus
MEMORANDUM OPINION (1)
This proceeding arises from the trial court's grant of a motion to compel production filed by real party in interest, David Law. Relator, Steadfast Insurance Company ("Steadfast"), asserts that request for production number 28 and interrogatory number 8 are overbroad and unduly burdensome. We conclude that request for production number 28 and interrogatory number 8 are overbroad because they are not properly limited by time and geographic expanse. Accordingly, we conditionally grant mandamus relief.
Background
Forest Oil Corporation ("Forest") owned and operated the 466-B Oil Drilling platform off the coast of Galveston, Texas. Law served as project supervisor to plug and abandon the well. However, the well could not be plugged because an old fishing tool was lodged within.
While trying to remove the tool, Marion Yeager was killed by exploding metal fragments. Law assisted in Forest's initial investigation of the accident, was interviewed by Minerals Management Service investigators regarding the accident and was present when the pipe involved in the accident was tested. Subsequently, Forest terminated Law.
Yeager's heirs sued Forest. Counsel for the heirs noticed Law's deposition. However, Law could not be found in time for his deposition, and he was not deposed. Forest and its insurers settled with Yeager's heirs. The settlement agreement explicitly omitted Law and his employer, Drilling & Completion Supervisors, Inc. ("DCS").
Forest sued Law and DCS, claiming common law indemnity in excess of $3,000,000. The indemnity claim is premised upon the allegation that Forest incurred liability to Yeager's heirs because of Law's negligence. Yeager's heirs also filed suit against Law and DCS, asserting wrongful death and survivor claims. Law filed third party claims against Steadfast, Forest's primary coverage insurer, and Associated Electric & Gas Insurance Services Limited ("AEGIS"), Forest's excess coverage insurer. In his third party claims, Law sued Steadfast and AEGIS for violation of the Texas Insurance Code and the Texas Deceptive Trade Practices Act, breach of common law duty of good faith and fair dealing, and breach of contract. Law sought a judgment from the trial court holding Steadfast responsible to Law for indemnity against any judgment against him in the suit.
Law served Steadfast with requests for production and interrogatories. Steadfast timely served its objections and responses, withholding statements, and privilege logs. Thereafter, Law moved to compel production of the requested documents and information. Request for production number 28 and interrogatory number 8 provide:
Request No. 28: Your entire claim file for each claim in which you have been alleged to have acted in bad faith or in breach of an insurance policy with respect to a claim against an employee, borrowed servant, consultant or subcontractor for your insured for the period beginning on January 1, 1998 through the present.
Interrogatory
No. 8: Identify each insurance claim in which you have been alleged to have acted in bad faith or in breach of an insurance policy with respect to a claim against an employee, borrowed servant, consultant or subcontractor for your insured for the period beginning on January 1, 1998 through the present including for each such claim the court and case number; contact information for all parties, attorneys, adjusters, insurance agents, insurance brokers, insureds and claimants involved.
After in camera review of the documents designated by Steadfast and AEGIS as privileged, the trial court signed an order granting the motion to compel. The order imposes specific time and context constraints on many of the requests for production and interrogatories. In its order, the trial court restricted request for production number 28 and interrogatory number 8 accordingly: "Discovery is ordered as to such matters that developed into a lawsuit to which Steadfast or AEGIS have been a party."
On February 20, 2009, Steadfast moved for reconsideration of the court's order by producing a supplemental affidavit. That affidavit demonstrates that there are 5,586 claim files that Steadfast would have to examine individually to satisfy request for production number 28 and interrogatory 8, at a cost of $160,000.
Motion to Compel Production Steadfast contends that request for production number 28 and interrogatory number 8 are overbroad and unduly burdensome. Law asserts that the trial court tailored request for production number 28 and interrogatory 8 and that they are not overbroad or unduly burdensome.
Mandamus relief is available only to correct a "clear abuse of discretion" when there is no adequate remedy by appeal. Walker v. Packer, 827 S.W.2d 833, 839 (Tex. 1992) (orig. proceeding). Clear abuse of discretion occurs when a trial court "reaches a decision so arbitrary and unreasonable as to amount to a clear and prejudicial error of law." Id. (quoting Johnson v. Fourth Court of Appeals, 700 S.W.2d 916, 917 (Tex. 1985) (orig. proceeding)). The reviewing court may not substitute its judgment for that of the trial court when reviewing factual issues. Id. at 839-40. Even if the reviewing court would have decided the issue differently, it cannot disturb the trial court's decision unless the decision is shown to be arbitrary and unreasonable. Id. at 840. Mandamus relief is proper when a trial court erroneously orders the production of privileged information that materially affects the rights of the aggrieved party. Id. at 843. A discovery order compelling overly broad discovery "well outside the bounds of proper discovery" is an abuse of discretion remedied by mandamus. Texaco, Inc. v. Sanderson, 898 S.W.2d 813, 815 (Tex. 1995).
The scope of discovery is generally within the trial court's discretion. Dillard Dept. Stores, Inc. v. Hall, 909 S.W.2d 491, 492 (Tex. 1995). The trial court abuses its discretion by ordering discovery that exceeds the parameters permitted by the rules of procedure. Texaco, Inc., 898 S.W.2d at 815. A discovery request must be reasonably calculated to lead to the discovery of admissible evidence. Tex. R. Civ. P. 192.3(a). Evidence must be relevant to be admissible. Tex. R. Evid. 402. Evidence is relevant if it has a tendency to make the existence of a fact that is consequential to the determination of the action more probable or less probable than it would be without the evidence. Tex. R. Evid. 401.
Discovery requests must be limited by time, place, and subject matter. In re Xeller, 6 S.W.3d 618, 626 (Tex. App.--Houston [14th Dist.] 1999, orig. proceeding). "Although the scope of discovery is broad, requests must demonstrate a reasonable expectation of obtaining information that will aid the dispute's resolution." In re CSX Corp., 124 S.W.3d 149, 152 (Tex. 2003). Discovery may not be used to impose unreasonable expenses on the responding party. In re Alford Chevrolet-Geo, 997 S.W.2d 173, 180-81 (Tex. 1999). "Fishing" for evidence is impermissible. K Mart Corp. v. Sanderson, 937 S.W.2d 429, 431 (Tex. 1996). A party embarks on a "fishing expedition" when it submits discovery requests that are "not narrowly tailored and are overly broad." See In re Sears, Roebuck & Co., 146 S.W.3d 328, 333 (Tex. App.--Beaumont 2004, orig. proceeding). "[A] twenty-state search for documents over a five-year period is overly broad as a matter of law." Hall, 909 S.W.2d at 492. An order compelling overly broad discovery is an abuse of discretion. Id.
In Hall, the plaintiff sued Dillard for false arrest and the infliction of personal injury for detaining him while shopping at a Dillard store in Houston, Texas. Id. at 491. In his request for production, the plaintiff sought "[c]opies of all complaints, including lawsuits filed against Defendant, which involve an alleged wrongful detention, arrest, civil rights violation, or any other complaint similar to the complaint of Plaintiff." To substantiate its assertion that the request was overly broad and unduly burdensome, Dillard submitted affidavit evidence providing that Dillard had 227 stores in twenty states. "The trial court ordered Dillard to produce every claims file and incident report prepared from 1985 through 1990 in every lawsuit or claim that involved allegations of false arrest, civil rights violations, and excessive use of force." Id. at 492. The supreme court noted two reasons justifying mandamus relief for Dillard. First, the court recognized that because the plaintiff sought the discovery to explore the viability of an allegation of racial discrimination, it was a classic "fishing expedition." Id. Second, the supreme court held that "a twenty-state search for documents over a five-year period is overly broad as a matter of law." Id.
In K Mart Corp. v. Sanderson, the plaintiff, who had been abducted from a K Mart parking lot in Lufkin and raped, alleged that K Mart was negligent in failing to adequately provide for her safety. 937 S.W.2d at 429. The plaintiff asked K Mart in an interrogatory to "[p]lease describe by date and offense type any criminal conduct that occurred in the K Mart store or parking lot in the shopping center in question during the last seven (7) years." Id. at 431. The supreme court reasoned that the interrogatory was overbroad because K Mart would be required "to give the date of every shoplifting offense for the past seven years, though shoplifting on K Mart's premises has no apparent connection to [the plaintiff's] injury or cause of action." Id. Other of the plaintiff's interrogatories were held to be overbroad under similar logic. Id. As in Hall, the supreme court determined that the plaintiff was "fishing." Id; see also Texaco, Inc., 898 S.W.2d at 814-15 (in case alleging exposure to toxic chemicals, request for all documents written by defendant's safety director relating to "safety, toxicology, and industrial hygiene, epidemiology, fire protection and training" were overbroad and constituted fishing expedition.).
Here, even after tailoring by the trial court, request for production number 28 and interrogatory number 8 are overbroad. In its affidavit, Steadfast states that (1) there were exactly 5,586 claim files opened under an insurance policy issued by Steadfast that developed into a lawsuit within the ten year period specified in the discovery; (2) because Steadfast "writes many different lines of insurance policies in nearly all 50 states and U.S. territories," only a "fraction" of these lawsuits involve claims against Steadfast in Texas; (3) Steadfast has no way to determine whether it is a named party in any lawsuit other than to manually review each claim file; and (4) the cost of manually reviewing, redacting, and producing a response to request for discovery 28 and interrogatory 8 could exceed $160,000.
In K Mart and Texaco, the supreme court characterized discovery requests as "fishing expeditions" because they were overbroad and not narrowly tailored. See K Mart, 937 S.W.2d at 431; Texaco, Inc., 898 S.W.2d at 815. Law, too, seeks to conduct a fishing expedition. See K Mart, 937 S.W.2d at 431; Texaco, Inc., 898 S.W.2d at 815. Specifically, Law seeks insurance claims in which Steadfast is alleged to have "acted in bad faith or in breach of an insurance policy." This broad language encompasses conduct beyond Law's allegation of conspiracy to prevent him from claiming insurance coverage. Additionally, Law is seeking discovery whose production entails, according to evidence, approximately a fifty-state search over a ten-year period. A discovery request requiring a fifty-state search over a ten-year period is overbroad as a matter of law. See Hall, 909 S.W.2d at 492. Because request for production 28 and interrogatory 8 are overbroad and not narrowly tailored, they constitute an impermissible fishing expedition. See In re Sears, Roebuck & Co., 146 S.W.3d at 333 ("The discovery requests here are not narrowly tailored and are overly broad. They are the kind of 'fishing expedition' the Supreme Court has repeatedly struck down."). Accordingly, we conclude that the trial court abused its discretion by granting the motion to compel with regard to request for production 28 and interrogatory 8. See Hall, 909 S.W.2d at 492.
Conclusion
We conditionally grant the petition for writ of mandamus, and direct the trial court to relieve Steadfast insurance of all obligation to respond to Law's request for production number 28 and interrogatory 8. Nothing in this order precludes the trial court from more narrowly tailoring the discovery. The writ will issue only if the trial court fails to comply.
Elsa Alcala
Justice
Panel consists of Chief Justice Radack and Justices Alcala and Hanks.
1. The underlying case is Forest Oil Corporation v. Drilling & Completion Services, Inc. and David Law, Cause No. 07-CV-1211, in the 56th Judicial District Court of Galveston County, Texas, the Hon. Lonnie Cox, presiding.