United States District Court, D. Arizona
G. Murray Snow Chief United States District Judge.
before the Court is Plaintiffs Motion to Compel and Motion
for Sanctions (Doc. 99). For the following reasons, the Court
will grant the Motion to Compel and defer a ruling on the
Motion for Sanctions.
early 2016, Defendant Electric Insurance Company
(“Electric”) was initially made aware of
Plaintiffs' potential underinsured motorist
(“UIM”) claim. Plaintiffs' counsel sent other
letters to Electric in February 2016 asking for Electric to
identify documents that would be needed to review the claim.
Electric did not respond to the letters.
March 20, 2017, Plaintiffs sent a demand letter to both
Travelers Insurance and Electric, requesting a payment of the
full policy limit. Travelers issued a payment of $1, 000, 000
to Mr. Nerdig on March 24, 2017. Electric began evaluating
Mr. Nerdig's claim on March 28, 2017, after being
informed that the UIM coverage from Travelers was exhausted.
Electric then brought on defense counsel on April 12, 2017 to
assist in adjusting the claim. Defense counsel requested Mr.
Nerdig to undergo an Examination Under Oath, an Independent
Medical Examination, and to authorize Electric to obtain
additional medical records. Electric's contract with Mr.
Nerdig provides that an insured may be required to submit to
the above requests. On April 28, 2017, Electric offered Mr.
Nerdig $50, 000. On May 7, the claim was reassigned to
Electric claims adjuster Tim McNamara. Plaintiffs, Mr. Nerdig
and his wife, filed suit on May 15, 2017.
this Court's Order on Defendant's Motion for Summary
Judgment, Plaintiffs' only remaining claims are for bad
faith and punitive damages. (Doc. 97).
attorney work product doctrine protects documents that are
“prepared in anticipation of litigation or for
trial.” F.R.C.P. 26(b)(3); see Hickman v.
Taylor, 329 U.S. 495 (1947). The work product doctrine
applies not only to work performed by lawyers, but also to
work performed by a party's “representative”
or “agent, ” and therefore presumably extends to
work performed by Defendant's claims adjusters Alan
Hunter and Tim McNamara, so long as that work was prepared in
anticipation of litigation. See F.R.C.P. 26(b)(3).
“The primary purpose of the work product rule is to
prevent the exploitation of a party's efforts in
preparing for litigation.” Holmgren v. State Farm
Mut. Auto Ins. Co., 976 F.2d 573, 576 (9th Cir. 1992)
(internal citations and quotation marks omitted). A document
is prepared in anticipation of litigation if “it can
fairly be said that the document was created because of
anticipated litigation, and would not have been created in
substantially similar form but for the prospect of that
litigation.” In re Grand Jury Subpoena, 357
F.3d 900, 908 (9th Cir. 2004).
work product may still be discoverable if mental impressions
are at issue in a case and the need for the material is
compelling. Id. at 577. “In a bad faith
insurance claim settlement case, the strategy, mental
impressions, and opinion of the insurer's agents
concerning the handling are directly at issue.”
Id. “Unless the information is available
elsewhere, a plaintiff may be able to establish a compelling
need for evidence in the insurer's claim file regarding
the insurer's opinion of the viability and value of the
Arizona, the attorney-client privilege is defined by statute.
See A.R.S. § 12-2234. For a communication to be
protected by the attorney-client privilege, “the
communication must be made to or by the lawyer for the
purpose of securing or giving legal advice.”
Samaritan Foundation v. Goodfarb, 176 Ariz. 497,
501, 862 P.2d 870, 874 (1994) (en banc). “Thus, not all
communications to one's lawyer are privileged.”
Id. And, merely assigning an attorney to perform an
ordinary insurance business function does not “cloak
with privilege matters that would otherwise be
discoverable.” Merrin Jewelry Co. v. St. Paul Fire
Marine Ins. Co., 49 F.R.D. 54, 57 (S.D.N.Y. 1970).
seek to compel production of several documents, including a
Large Loss Report from May 2016, Flash Reports, documents
that contain handwritten notes from Mr. Hunter, emails
between defense counsel and Mr. Hunter, handwritten notes
from Mr. McNamara from after the start of litigation, a
medical report prepared by a nurse consultant, Nancy Liebe,
email communications between defense counsel and Electric
after the lawsuit was filed, and claim notes after defense
counsel was brought in to help adjust the claim. Electric
argues that all of these materials are work product, and that
the emails sent and received by defense counsel and the claim
notes after April 12 are additionally protected by attorney
Materials Protected by the ...