Swan Realty Group, LLC v. State Farm Fire and Casualty Company

Swan Realty Group, LLC v. State Farm Fire and Casualty Company (8:24-cv-364) Position Statements Regarding Disputes Concerning Rule 30(b)(6) Deposition Notice Plaintiff Issued to Defendant

DEPOSITION TOPIC PLAINTIFF’S POSITION DEFENDANT’S POSITION Topic No. 1: As alleged in Swan’s This case involves an alleged The Names, Job Titles, Annual Complaint, State Farm breach of an insurance contract Compensation Amounts and admitted damage to the with respect to alleged storm structures, and description of the interior, roof, and other damage to a house. Plaintiff is positions of State Farm’s employees structures was covered the purported assignee of the within the office or offices responsible under the prior insurance claim. Because an for handling or supervising the Claim. homeowner’s policy; assignee lacks standing to The designee should be prepared to however, the estimate assert a bad faith claim under testify regarding the hierarchy of the provided was not Nebraska law, there is no bad persons involved in the claim for each commensurate with the faith claim in this lawsuit. department involved, the specific scope of work required to State Farm has paid Plaintiff in responsibility and authority for each remediate the damage. excess of $80,000 on the claim person involved in any manner in the State Farm denied these to date. Plaintiff is demanding claim, the roles of each person in any allegations and more. Thus, the lawsuit is investigation of the claims, the identity affirmatively alleged it is limited to whether State Farm and scope of supervision, and the entitled to a credit or offset breached the contract by monetary authority for each person, for all amounts it was denying certain aspects of and the chain of command for State previously paid. Due to Plaintiff’s claim.

Farm of all decisions on the Claim, State Farm’s admission of and how that individual became coverage then later denial, Each claim handler’s monetary involved or assigned to the Claim. the personnel involved, their settlement authority is not decision-making authority, reasonably calculated to lead financial incentives, and to the discovery of admissible evaluation of performance evidence regarding whether is relevant under Fed. R. Plaintiff’s damage claims are Civ. Pro. 26(b)(1) to the covered by the policy. In determination of whether addition information regarding coverage existed, and the employee compensation is not extent of coverage, by the reasonably calculated to lead employees of State Farm in to the discovery of admissible this case. See Timm evidence regarding whether the Grandview, LLC v. claimed damage is covered and AmGUARD Ins. Co., No. is not proportional to the needs 8:20CV197, 2021 WL of the case. See Buckley 1120940, at *7 (D. Neb. Towers Condominium, Inc. v. Mar. 23, 2021) (finding QBE Ins. Corp., 2008 WL interrogatories seeking 2645680, at *5 (S.D.Fla., information related to 2008) (“[I]f the general rule potential employee were that every … insurance incentives was relevant to adjuster's financial or breach of contract claim contractual documents with an asserted against the insurer insurer were subject to because such information production in a breach of could be used to undercut contract coverage dispute, the the insurers assertion that it scope of discovery in these conducted a proper cases would be materially investigation and it could increased. The litigation cost also be used to attack the and time required to address credibility of the claims that broadened discovery adjuster’s damage would undermine the essential assessments); see also purpose of this case- Rounds v. Hartford, No. adjudicating whether coverage 4:20-CV-04010-KES, 2021 applies at all and the amount WL 4150838, at *6 (D.S.D. that the insured is due under Sept. 13, 2021) (“Bonus the policy. That targeted programs may provide some process should not become evidence of the motivation unwieldy and should not of claims personnel in consume unnecessary evaluating a claim.”); resources.”). Both of the cases Pochat v. State Farm Plaintiff relies on involved bad Mutual Automobile Ins. Co., faith claims and are therefore No. Civ. 08-2015-KES, inapplicable. 2008 WL 5192427 at *5 (D.S.D. Dec. 11, 2008) State Farm will produce a (holding “information witness who will testify about [regarding employee award the names and job titles of and financial bonus those employees who handled programs is] ... relevant to or supervised this Claim and plaintiff's bad-faith what each person’s role was in insurance and breach of the claim. contract claims”).

This topic is also expressly tailored to the Claim and claim adjusters. Plaintiff is willing to enter a reasonable protective order to address any confidentiality concerns.

Topic No. 2: Same position as for Topic The issue in this case is The details surrounding the No. 1 above. whether State Farm breached assignment of the various claim the policy by denying owners or handlers on the Claim. This Plaintiff’s claims for damages. includes information regarding the The process of how claim process of claim assignments, other handlers are assigned to employees who were available to claims, and whether other adjust the Claim, and the education claim handlers who were and work history along with any available to handle the claim is training State Farm provided or paid not reasonably calculated to for each employee. lead to the discovery of admissible evidence and is not proportional to the needs of the case.

Topic No. 3: Same position as for Topic There is no allegation of bad Financial incentives, bonuses, No. 1 above. faith in this lawsuit. Because including short term incentive there is no claim of bad faith, a programs (however called) that State claim handler’s financial Farm claim adjusters, claim managers motive, if any, is irrelevant. or other employees may be eligible The sole issue is whether the for, and the criteria, process, or contract was breached. metrics used (however called) to Information regarding determine whether a claim employee compensation adjuster/claim managers/employee is amounts and structures is not eligible to receive the incentive, reasonably calculated to lead bonuses, including short term to the discovery of admissible incentive programs (however called). evidence and not proportional to the needs of the case. See Buckley Towers Condominium, Inc. v. QBE Ins. Corp., 2008 WL 2645680, at *5 (S.D.Fla., 2008) supra. Topic No. 4: Same position as for Topic There is no allegation of bad Criteria and process used to evaluate No. 1 above. faith in this lawsuit, so what employee performance for the criteria State Farm uses to employees involved in the Claim. evaluate employee performance for the employees involved in this case is not reasonably calculated to lead to the discovery of admissible evidence. See Bay Point Turtlegrass Villas Association v. Lexington Insurance Company, 2021 WL 12135389, at *3 (N.D.Fla., 2021) (“Several courts have held that policies, procedures, guidelines, and other documents relating to the handling or adjusting of claims are relevant only to bad faith claims and, therefore, are not discoverable in actions solely for breach of contract.”)

Topic No. 5 As alleged in Swan’s There is no allegation of bad All training, applicable to claims Complaint, State Farm faith in this lawsuit, so the handling, provided to State Farm admitted coverage under the training provided to the claim employees handling the Claim, policy for the Claim. State handlers involved in this case concerning: (a) first party Farm later denied coverage is not reasonably calculated to homeowner’s damages, (b) evaluation for Swan’s damaged lead to the discovery of of structural property damages, (c) property. The process by admissible evidence. See Bay evaluation of structural property which State Farm handles Point Turtlegrass Villas homeowner's damages, (d) evaluation homeowner’s claims and Association v. Lexington of personal property damages (e) types makes determinations of Insurance Company, 2021 WL of evidence/proof, (f) coverage, including the 12135389, at *3 (N.D.Fla., weighing/evaluating evidence/proof, manner and method State 2021) (“Several courts have (g) types of information/evidence that Farm’s employees of are held that policies, procedures, reduces the value of a claim; (h) types trained, is relevant. This guidelines, and other of information/evidence that reduces topic is limited to the documents relating to the the value of a claim; (i) how to assess training provided to the handling or adjusting of claims damages; (j) quantum of employees handling the are relevant only to bad faith evidence/documents/information/proof Claim at issue in this case claims and, therefore, are not necessary to prove a 1st party claim, and sets forth particular discoverable in actions solely (k) payment of undisputed amounts in items of training. Plaintiff for breach of contract.”). The a 1st party claim; claim handling, is willing to enter a issue is what claim decision claim investigation, (l) tool to reasonable protective order was made in this case, not use/tools available to an adjuster when to address any what training is provided in a questions or concerns arise regarding confidentiality concerns. generic first party insurance the claim, such as questions or claim. Moreover, Plaintiff has concerns arise regarding he claim, requested the depositions of such as questions or concerns the claim handlers involved in regarding damages, (m) Xactimate or this case, who are in a better Xact Contents training. position to testify as to how they handled the claim.