Potomac Electric Power Co. v. California Union InsurancePotomac Electric Power Co. v. California Union Insurance
ORDER
Since the Fall of 1989, the parties have besieged this Court with six motions to compel. Currently ripe are the last five, four of which require resolution on the merits. Given the deluge of related pleadings we have received, we are tempted to leave the parties to their own resources. Nevertheless, we now address the remaining motions at some length, with the expectation that our discourse will discourage another flood of papers in connection with motions for reconsideration.
1. Pepco’s Motions to Compel Against Wausau, First State, and National Union
Pepeo, in separate motions, has moved to compel defendants Wausau, First State, and National Union to provide information relating to: (1) communications between these defendants and their reinsurers for the poliсies that defendants issued to Pep-eo; and (2) third party claims involving pollutants that act similarly to PCBs when spilled on the ground. For the reasons explained below, we hold that Pepeo is not entitled to discovery in the first area, but may conduct limited discovery in the second.
A. Communications With Reinsurers
Rulе 26(b)(2) authorizes “discovery of the existence and contents of any insurance agreement under which any person carrying on an insurance business may be liable to satisfy part or all of a judgment which may be entered in the action or to indemnify or reimburse for payments made to satisfy the judgment.”
Defendants assert, however, that correspondence or other documents relating to reinsurance agreements which Pepeo seeks do not fall within the purview of
Pepeo demands discovery of “communicatiоns which occurred at or around the time” the reinsurance policies were obtained. Pl.Reply Mem. in Supp. of Mot. Against First State and Nat’l Union at 12.
This Court has broad discretion to limit discovery under
B. Third Party Claims
On the other hand, we hold that Pepeo is entitled to limited discovery in this area. See Independent Petrochemical Corp. v. Aetna Casualty & Surety Co.,
Defendants, aside from objections on the grounds of undue burden and relevance, assеrt generally that some third party claim information may be protected by the work product doctrine or the attorney-client privilege. We hold that defendants may redact the names of third party insureds from any information they provide. In addition, the precise terms of any settlements need not be disclosed.
II. National Uniones Motion to Compel Against Pepeo
National Union seeks an order compelling Pepeo to answer its First Set of Interrogatories Nos. 9, 25, 26, 27, and 28 more fully. It bases its motion largely on Pep-co’s alleged failure to comply with the procedures for responding to interrogatories outlined under Rule 33. While technically Pepeo may not have adhered to these procedures, we are at a loss to discern how its noncompliance in any way prejudiced National Union. The Court’s time should not be spent on futile exercises. National Union also claims that Pepco’s responses are substantively insufficient. We disagree. In light оf the massive amount of discovery that has already taken place in this case, we find that Pepeo has provided National Union with adequate responses, both in form and in substance, to the interrogatories in question.
III. Defendants’ Joint Motion to Compel Against Pepeo
After defendants filed this motion, the parties resolved some of the issues it addressed. The remaining issues are: (1) whether Pepeo must produce documents, including those on its privilege lists, pertaining to its investigation, defense, and settlement of the underlying criminal and civil proceedings for which it seeks insurance coverage; (2) whether Pepeo must produce unredacted copies of legal bills reviewed by attorneys Michael Schatzow and George Mernick in preparation for their depоsitions; and (3) whether Pepeo must state affirmatively that all responsive documents have been identified. The second and third issues may be dealt with summarily. Pepeo must, consistent with our Orders filed November 6, 1989, and January 5, 1990, produce all documents reviewed by Messrs. Schatzow and Mernick in preparation for their depositions. Additionally, we agree with defendants that Pepco’s privilege logs imply that Pepco’s document production may be incomplete. In order to eliminate any doubt, we shall require Pepeo to inform defendants of whether any documents responsive to defendants’ discovery requests have not been identified. If Pepeo has not yet identified all responsive documents, it shall promptly produce any remaining documents or, if it believes a privilege attaches to any document, identify such document by way of a privilege log.
As to documents pertaining to Pepco’s investigation, defense, and settlement of the underlying proceedings, we are persuaded that equity and the case law weigh in favor of production. These documents are сlearly relevant. The insurance policies at issue indemnify Pepeo for “ultimate net loss” within the coverage terms and conditions, including reasonable defense costs relating to an insured loss. Defendants deny that the PCB contamination is an insured loss and deny that Pepеo has satisfied various conditions to coverage under the policies. In addition, assuming that the PCB contamination is an insured loss, defendants disclaim liability for certain costs related to the underlying proceedings. Thus, Pepco’s conduct and the apportionment оf costs in connection with the investigation, defense, and settlement of the underlying proceedings are directly at issue in this case.
Plaintiff argues that the documents are protected by the attorney-client privilege or the work product doctrine. We disagree. It is clear that Pepeo has brought its own conduct and the conduct of its counsel in the underlying proceedings directly into issue by instituting this action to recover approximately $3.25 million for clean-up costs and $3.5 million for defense costs allegedly incurred in connectiоn with those proceedings. Under these circumstances, defendants are entitled to inspect documents pertaining to the underlying proceedings, regardless of whether they contain attorney work product or communications normally protected by the attоrney-client privilege. See Byers v. Burleson,
IV. Pepco’s Motion to Compel Against North River, London Market, and American Centennial
Fortunately, this motion was rendered moot when defendants filed responses to Pepco’s second set of interrоgatories on December 15, 1989. Accordingly, we now dismiss it.
Conclusion
We have carefully evaluated all of the arguments made in support of and in opposition to each of the four motions that required resolution on the merits. Any argument not expressly addressed above is hereby rejected as without merit.
Accordingly, for all of the foregoing reasons, it is by the Court this 13th day of February, 1990,
ORDERED that plaintiff’s motions to compel against defendants Wausau, First State, and National Union are granted in part and denied in part; it is
ORDERED that, within forty-five (45) days of the date of this Order, defendаnts Wausau, First State, and National Union shall provide plaintiff with previously requested information on third party claims that were either litigated or ultimately paid, and which were filed under similar policies for incidents of PCB contamination that occurred during the effective datеs of Pepco’s policies with said defendants, it being understood that the names of third party insureds and the precise terms of any settlements need not be disclosed; it is
ORDERED that defendant National Union’s motion to compel against plaintiff concerning answers to National Union’s First Set of Interrogatories Nos. 9, 25, 26, 27, and 28 is denied; it is
ORDERED that defendants’ joint motion to compel against plaintiff is granted; it is
ORDERED that plaintiff shall, within ten (10) days of the date of this Order, produce for inspection all previously withheld documents that were reviewed by Messrs. Schatzow and Mernick in preparation for their depositions; it is
ORDERED that plaintiff shall, within fifteen (15) days of the date of this Order, inform defendants in writing of whether any documents responsive to defendants’ discovery requests have not been identified, it being understood that any responsive documents that have not been identified shall be produced for inspection or identified in a privilege log within fifteen (15) days of the date of this Order; it is
ORDERED that, within fifteen (15) days of the date of this Order, plaintiff shall produce for inspection all documents, including those on plaintiff’s privilege lists, pertaining to plaintiff’s invеstigation, defense, and settlement of the underlying proceedings for which plaintiff seeks insurance coverage in this action; and it is
FURTHER ORDERED that plaintiff’s motion to compel against defendants North River, London Market, and American Centennial is dismissed as moot.
Notes
. We have literally been inundated with paper in this case. When last seen, the docket entries totaled 220 and took up more than 20 pages, even though the case is still in discovery. That this is an abuse of the process is an understatement.
. Pepco’s original request was broader, and although Pepeo technically has not limited its request with respect to Wausau, Pepco’s motion against Wausau is indistinguishable from its motion against the other defendants. Therefore, the Court reads Pepco’s narrowed request as applying to Wausau as well.
. By similar policies, we mean either first (Wau-sau) or second (First State and National Union) layer excess comprehensive general liability coverage containing language similar to that found in the Pepeo policies.
. Accordingly, First State and Wausau need only provide third party claim information for PCB contaminations that occurred during the period from October 31, 1981, through October 31, 1982. The operative period for National Union runs from March 1, 1980, through March 1, 1981.
. Pepeo "is not interested in the details of ... settlements, but only in whether [defendants] admitted coverage and/or paid any substantial amounts.” Pl.Rep.Mem. in Supp. of Mot. Against First State and Nat’l Union at 11. Pepeo agrees that the protective order dated October 23, 1989, will govern Pepco’s disclosure of confidential information.
. In each instance, Natiоnal Union "has had ample opportunity,” by alternative means, "to obtain the information sought."