Tuesday, December 1, 2009

Judge Wettick Discusses Discovery Issues in Consolidated Post-Koken Case

In his recent Opinion in the case of Wutz v. Smith and State Farm Ins. Co., No. GD07-21766 (Allegheny Co., Sept. 9, 2009, Wettick, J.), Judge R. Stanton Wettick established a discovery timetable for the production of the UIM claims file in a case involving both a breach of contract claim against State Farm for failure to pay underinsured motorist benefits and a bad faith claim against State Farm based on allegations that the carrier's failure to handle the UIM claim in good faith violated 42 Pa.C.S. §8371. The case was, therefore, essentially a UIM claim and a bad faith claim brought under one caption.

As part of his bad faith discovery efforts, the plaintiff filed a motion to compel the carrier to produce its UIM claims file. The plaintiff was seeking information in terms of how the UIM carrier was formulating its evaluation of the claim presented.

Judge Wettick noted that the information which plaintiffs sought was only relevant to the bad faith claim.

Referring to his own prior decision in Gunn v. Auto. Ins. Co. of Hartford, Conn., 2008 WL 6653070, GD07-Civil-002888 (Alleg. Co. July 25, 2008), Judge Wettick noted that he had stated therein "that a court, in its discretion, will not necessarily permit discovery of all information in the files of the insurance company relevant to the bad faith claim. The insurance company should have the opportunity to show that discovery of certain information relevant to the bad faith claim will unduly prejudice the insurance company in its defense of the UIM claim."

In this case, counsel for State Farm argued that the carrier would be prejudiced in terms of the negotiations and the trial on the UIM side if it was required to preliminarily produce its UIM claims file for review by the plaintiff. State Farm argued that allowing for such discovery "would be akin to requiring the defense in a football game to furnish its defensive formation for the upcoming play to the plaintiff before the plaintiff selected the play that it would call."

Judge Wettick agreed with the State Farm argument and held that the UIM claims file need not be produced in these types of cases until after the UIM portion of the claim is submitted to the jury. Once the case is submitted to the jury, the UIM carrier would be required to produce the discovery for an in camera review by the court. As held in the Gunn case, Judge Wettick again noted that once the jury came back with a verdict on the UIM claim, the case could move right into the non-jury bad faith proceedings before the same trial judge.

Judge Wettick also noted that a plaintiff could move for a stay of the trial under Pa.R.C.P. 213 in those cases where the plaintiff had insufficient time to review the carrier's UIM file and prepare for the immediate bad faith trial or where the plaintiff can otherwise establish to the court that the case cannot be tried immediately.

At the conclusion of his opinion, Judge Wettick also held that that carrier need not produce those documents protected by the attorney-client privilege as long as the carrier was not raising advice of counsel as a defense to the bad faith claim.

Anyone wishing to secure a copy of this case may email me at dancummins@comcast.net.

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