` United States Court of Appeals,
Fifth Circuit.
No. 93-9109.
Frederick C. TIBERI, et al., Plaintiffs,
v.
CIGNA INSURANCE COMPANY, et al., Defendants,
CIGNA Insurance Company, et al., Defendants-Appellants.
M. Eliza STEWART, Appellant,
v.
MILLERS MUTUAL FIRE INSURANCE COMPANY and Millers Group
Insurance, Appellees.
Dec. 19, 1994.
Appeal from the United States District Court for the Northern
District of Texas.
Before POLITZ, Chief Judge, DUHÉ and BARKSDALE, Circuit Judges.
POLITZ, Chief Judge:
CIGNA Fire Underwriters Insurance Company and its attorney M.
Eliza Stewart appeal an order of the district court denying them
discovery and awarding costs and attorneys fees to Millers Mutual
Fire Insurance Company and Millers Group Insurance. We affirm in
part, reverse in part, and vacate in part.
Background
This appeal arises from attempts at discovery in the Northern
District of Texas for litigation pending in the District of New
Mexico in which CIGNA is the defendant in a breach of contract
suit. The gravamen of that action is a claimed loss of business by
insurance sales personnel because of acts by CIGNA.
CIGNA determined from records of the New Mexico Department of
Insurance that the plaintiffs may have written insurance with other
carriers despite an exclusivity agreement with it. CIGNA sought
discovery from Millers regarding any insurance the plaintiffs may
have written with it. Following discussions between CIGNA and
Millers, CIGNA obtained a subpoena duces tecum in the Northern
District of Texas for a deposition to be taken in Dallas in late
September 1993. On September 9, 1993, Millers moved to quash or,
in the alternative, for a protective order.
On September 21, 1993, the court a quo scheduled a hearing on
the motion for the next morning. Late on September 21, CIGNA's
counsel in New Mexico prepared and executed sworn statements
relevant to the next day's hearing and faxed them to their Dallas
counterparts. At the hearing the next day the court refused to
consider the facsimile statements, barred the discovery sought, and
ordered Stewart and CIGNA to pay Millers' costs and attorneys fees
totaling $4100 for the motion to quash or protective order. CIGNA
timely appealed.
Analysis
CIGNA first contends that the district court erred in refusing
to admit the faxed affidavits. Fed.R.Civ.P. 43(e) provides that
"[w]hen a motion is based on facts not appearing of record the
court may hear the matter on affidavits presented by the respective
parties, but the court may direct that the matter be heard wholly
or partly on oral testimony or deposition." The district court
2
admitted one affidavit into evidence,1 thereby determining that the
hearing would not be wholly on oral testimony and that written
evidence could be considered.
Fed.R.Civ.P. 5(e) permits papers to be filed by facsimile
transmission if permitted by the rules of the district court.
Fed.R.Evid. 1003 provides that duplicates, which we understand to
include facsimiles, are as admissible as the originals, assuming
there are no authenticity concerns. We conclude that under the
very tight time constraints involved herein the district court
abused its discretion in refusing to consider the facsimiles.2
That evidentiary ruling is REVERSED.
CIGNA challenges the order of attorneys fees and costs,
contending that Fed.R.Civ.P. 26(c) and 37(a)(4) are inapplicable
and that it took reasonable steps to avoid imposing an undue burden
on Millers. The application of Rule 37(a) sanctions via Rule 26(c)
is not without question. Rule 37 is entitled "Failure to Make
Disclosure or Cooperate in Discovery: Sanctions," and by its
1
Although the district court rejected the faxed affidavits
of Jennifer L. Weed and M. Eliza Stewart, it admitted and
apparently considered Weed's earlier affidavit.
2
It might be contended that this error was harmless in light
of the district court's alternative conclusion that, even if
admitted, CIGNA's faxed affidavits would hold no weight as
against Millers' live testimony. As a rule, the court suggested
that an affidavit will not prevail over credible, conflicting
live testimony. That general statement must be taken cum grano
salis in the factual situation at bar considering temporal and
proximity factors. We conclude that the faxed affidavits provide
strong and essentially uncontroverted evidence of the good faith
efforts of CIGNA and Stewart to narrow the subpoena. Under the
controlling circumstances, the trial court erred in not according
appropriate weight to the faxed affidavits.
3
express terms applies to one resisting discovery. Rule 26(c),
entitled "Protective Orders," states that the Rule 37(a)(4)
provisions "apply to the award of expenses incurred in relation to
the motion" for a protective order. Read together, the rules
appear to apply only to persons refusing to comply with a valid
discovery request and not to persons seeking overbroad discovery.
Rule 26(c) is taken to state that the sanctions provision of Rule
37(a)(4) applies only if the "motion for a protective order is
denied in whole or in part." Further, Rule 37(a)(4)(A) provides:
If the motion [to compel] is granted or if the disclosure or
requested discovery is provided after the motion was filed,
the court shall ... require the party or deponent whose
conduct necessitated the motion ... to pay to the moving party
the reasonable expenses incurred ... unless the court finds
that the motion was filed without the movant's first making a
good faith effort to obtain the disclosure or discovery
without court action, or that the opposing party's
nondisclosure, response, or objection was substantially
justified ... (emphasis added).
The sanctions provisions of Rules 26 and 37 authorize expenses
against a party resisting discovery by unreasonably necessitating
a motion to compel or by unreasonably moving for a protective
order. There is neither warrant nor need to strain the express
language of these rules given the ready applicability of another
rule. Rule 45(c)(1) specifically provides for sanctions, including
"lost earnings and a reasonable attorney's fee" against one issuing
a vexatiously overbroad subpoena.
Upon completion of our review, we conclude that the
erroneously excluded affidavits present adequate proof that CIGNA
and Stewart engaged in sufficient good faith efforts to negotiate
reasonable parameters on the subpoena duces tecum to preclude
4
sanctions. The award of same was an abuse of discretion and the
sanctions are VACATED.
Finally, CIGNA contends that the district court erred in
barring discovery. We review the grant of a motion to quash a
subpoena for abuse of discretion.3 Although CIGNA's initial
request was overbroad, the district court described a more
appropriate, more narrowly-drawn request and gave CIGNA the
opportunity to proffer a new subpoena within those limits. Though
modification of an overbroad subpoena might be preferable to
quashing, courts are not required to use that lesser remedy first.4
Rather than totally barring necessary discovery, the trial court
exercised its discretion by combining its decision to quash the
overbroad subpoena with an expressed willingness to entertain
thereafter a more narrowly-drawn subpoena.5 The district court's
3
United States v. Arditti, 955 F.2d 331 (5th Cir.1992),
cert. denied, --- U.S. ----, 113 S.Ct. 597, 121 L.Ed.2d 534
(1992) and --- U.S. ----, 113 S.Ct. 980, 122 L.Ed.2d 134 (1993).
4
"On timely motion, the court by which the subpoena was
issued shall quash or modify the subpoena if it ... requires
disclosure of ... protected matter ... or ... subjects a person
to undue burden." Fed.R.Civ.P. 45(c)(3)(A). The choice to quash
or modify is discretionary in the district court. See also
Wright and Miller, Federal Practice & Procedure: Civil § 2457.
5
An order quashing a subpoena apparently has no res judicata
effect on a later, narrower subpoena. See Ariel v. Jones, 693
F.2d 1058, 1060 n. 2 (11th Cir.1982) (affirming quashing of
subpoena in one district but noting that the requesting party
could "in fact obtain the requested information in another
district"). Indeed, in the instant case the district court
expressly authorized a new subpoena stating that its order "does
not prevent further discovery from Millers, but merely prohibits
the discovery sought by the subpoena at issue." The district
court, while preserving judgment until Millers could present
objections, appears to endorse a subpoena limited in scope to
CIGNA's stated needs: "[t]he names and kinds of policies, the
5
decision to quash the subpoena and to allow CIGNA to start anew on
a clean slate instead of itself modifying the subpoena was within
the court's sound discretion. The district court's order quashing
the subpoena is therefore AFFIRMED. The matter is remanded in
order that CIGNA may pursue a new subpoena consistent with the
district court's order.
AFFIRMED IN PART, REVERSED IN PART, VACATED IN PART, and
REMANDED.
amount of premiums those policies have generated for Mr. Tiberi
or his agency and the amount of commissions ... generated by
those policies...."
6