mr o'donnell would you like to proceed i would thank you your honor and i apologize my computer is apparently too old to accommodate virtual background so i apologize been crying and we have apparently failed my staff tells me that means i need to spend the money on a new computer thank you your honor i know you did your argument just a little bit ago from what i understood i know the case was acted as a separate appeal i want to just be clear here that as i view this you know it's kind of a case that has a lot of complexity to it my goal here days to boil things down real basically and what and what i'd like to point out and our primary carrier hired claims service gallagher bass a well known claims service and they appointed counsel fairly soon notification the claim to our excess carrier went out to travelers after that demand was coming in from caterpillar and for about the next year gallagher bassett had an attorney who represented both what was not a party in that case but she monitored that litigation and ultimately the court knows the case settled but what i want to stress here is that the settlement demand that case was one hundred and fifty million dollars the case ended up settling for i think somewhere below five billion fifty million and what was never a party to that case and that's pretty significant here because what you have in this case primarily is a claim for indemnification based upon a express  clause in the contract that says we're going to compare the fall of oil to the fall of caterpillar billick case law for years has held that that is essentially a contribution claim go based on a contract  and early on the case that was circuit court ruling and that's why you have the nd minute complaint that was it issue when these discovery disputes cropped up what i'd also like to emphasize here though is that when we have a comparison of f contribution case the issue is still one of cause and that started out we thought the right way for us in this case back in two thousand and fifteen when when we got into discovery we we  produced a variety of what witnesses none of whom ever gave depositions in the underlying case had nothing to do with the alabama litigation and then we went over to lafayette indiana in the summer of two thousand and sixteen and we started taking depositions pad employees at the factory who supervised trained instructed and directed the work of all loaned workers who did entry level factory work why is that important because after we started doing those the court order that was drafted by caterpillar council and said look you've got no ability in this case to put on any evidence of causation you're just bound to some blue gated matter that you were not a party to it's in that context that we find ourselves here today and i want to be real that we're not st about your jurors our jurisdiction i can judge i would be happy to do that under three o three a three there was a final judgment entered against travellers they were held in contempt they were fined over forty thousand dollars for choosing to not disclose my claim filed documents or vote that they had been receiving since two thousand and thirteen and the reason that's important judge is because travelers issue if you look at the march hearing and you look at the may hearing in the august hearings in two thousand and eighteen travelers and myself made clear that there are two things going on here a caterpillar claim to coverage but then a completely separate defense the negligence claims that cat is pursuing against both and that's the unique anomaly here but under three o three a three judge that was a final judgment our rights were affected by that very significant because our attorney for is let's say that we were not even a party to this case because and let's say that the initial litigation against oil had been filed in a separate l court because the court knows this this claim against bolts could have easily been filed l court separately and that's been something that judge because he has always had a hard time wrapping his head around because caterpillar says hey look this is just the coverage case but for bold it's not it's a case premised on causation and proximate cause based upon the language in the contract  and so we have rights here as the insured as the court knows the insureds report to their carriers we reported the claim and as to the jurisdictional issue here even if we were students separate orders after we went to indiana in march of the summer of two thousand and sixteen did these cat depositions and i don't think like the content those depositions then the motion to restrict discovery came after that subpoenas to our claim service gallagher bass with an issue and to our claim consultant will in february two thousand and eighteen judge mccuskey entered an order that said that any privilege issues regarding goal are staged until both provided a rd privilege log we've already provided them to regarding the problems materials with the elder bass will this in february the th we went back to court a month later and and judge mccuskey asked caterpillar's counsel at the hearing in march well are you trying to get underneath their tent that's what we might call this and in in the midwest and caterpillars council said no we don't want the documents that are our pertaining to bulls defense to bolt strategy here now what i can tell the court though i haven't seen every single e mail that for example our risk manager our in house counsel sent to travelers or to gallagher bassett because the primary policy with the idea was only two million dollars of course the reporting upstream to the excess carrier travelers that has the coverage above the primary coverage now it is so important today here for the court to understand that we have this order that was entered and then just for the record so it's easy for the clerks of the court it's it's the order that was entered in march of two thousand and eighteen directed by caterpillar and paragraph six of that order it specifically says that the court also stays court reviews in camera the documents that bull has provided to the court pursuant to the february order that february order said specifically that goal will produce the log to caterpillar and caterpillar the court shall receive a copy of the confidential binder of documents being withheld separated by tabs and specifying the privilege we provided these binders to judge mccuskey now when there's fifty or one one hundred and fifty million dollars at stake it's unfortunate that there are just a ton of claim documents because you have claimed services if you have a claim consult willis who we hired to do consulting and then you have our carriers and what ha always been the genesis of this issue pro caterpillar's we need to get to the information about our claim to coverage on both spell policy what this court has to understand and be able to sort out the properly decide this case is that the completely separate issue here is that of bolts defense and that being the fact that in may have thirteen they threaten litigation it ensue just nine months later in february th when they filed suit in federal court in illinois  and then the matter was voluntary dismissed a few months later and refile them purely county circuit court for lack of diversity when i have to just to see each of the court to look at the hearings from march of two thousand and eighteen and in this hearing it was very clear that that mr reith said i want to be crystal clear we are not trying to get into the defense strategy in this case and in case anything been clear about that i want to set the record straight that was in response to the judge saying i'd say here in the midwest you're trying to get your nose under their tent to figure out what they're doing today in preparation for this case and what we have to discern here judge and what travelers very clearly argued in the february hearing they argued in the march hearing and it was argued as well by myself in march in august that there's different types of claim documents or travelers possesses that it's so important that we have to discern between and the problem here is unfortunately even back into a hearing that we held i think in january of two thousand and eighteen even mr reedy suggested that the court was going t camera that pertained to the subpoenas that were issued to gallagher bassett and willis and then again at at the hearing in march the same suggestion was made by mr reed that we were going to do these things and cameron in fact that's what that what we're arguing about here as the claims documents generally is not bold claim reporting at page twenty three of the hearing in august on august th judge mccuskey said that's what i understand he did not address bolt i'm not going to address will but that unfortunately we have an order as many of yours have been in this case not directed by the judge directed by caterpillar that specifically just says turn over all the claims documents generally and that is the problem and i want to point out judge that that when mr reedy argued this to to judge mccuskey back at the march hearing he was very clear and said look we are looking for their evaluation of our claim to coverage and that was in that transcript he did not say as i just read to you that he wanted our claim reporting by both today they id and to travelers now the subpoena to limit the discovery sought to caterpillar's claim for coverage on bolt's policy why is that important because caterpillar suing us for negligent hiring negligent supervision of an employee we didn't supervise  and unfortunately here the distinction is that unfortunately you know we have an m r declaratory coverage case filed in the same action that should have been l should have been filed in l court for money damages against bolt and that has been the judge had required us to bribe these logs and he specifically talked about the court needing to review the gal the bass logs and then the rd log as well as the will is privilege look those three binders were never reviewed by judge mccuskey and it was at that point after he did that that he was going to then address privilege issues as contained in documents with travel now and he said that at the hearing on page twenty five he said that those documents are still under review and then we went up on appeal two months later because he denied the days but i think to get a full understanding of this the march transcript passed the afternoon hearing is very very important that it starts with the our number two hundred and thirty and that hearing even m we're not trying to get under the hood here the problem with the order that we're appealing from concurrently with travelers is that the order was blank it just said oh these are just general claim documents generate an ordinary course of business that is too nominal o analysis in this kind of a case and i look at this very simply i you know if this was an auto case and i'm defending my insured driver and the plaintiff's attorney five serves a subpoena on my carrier sometimes a carrier brings in their attorney question that subpoena that's the dispute that you have before it because all the reporting by the insurer defendant and the attorneys are in that file the insurer regarding that negligence going i mean i'm right now thank you court the rules do not let party simply appeal unilaterally from the discovery ruling instead rule three hundred and four provides the basis for an appeal of discovery whether it be under rule three or four your documents are issue here their travelers documents you have been asked to be held in contempt all the way through the four hearings before this so i'm not going to attempt another three o four a the judge  three arguing that that will give them a right to appeal the way i read the rules and and i don't have a case d on this but the way i read the rules is a three o three if there was a three o three appeal another party case can join into three on three and three if that's kind of play four in the rules real three but three or four and not have a like provision it does not have a provision that says if another party is to that is the rules were drafted at the same time three or three and three or four and one is explicit and the other one has no provision so i think that was the intent with respect to the rules so how does how does both protect themselves  but any point along the line for the three pairings leading up to this they could have content and made in any sort of motion on the three o four a for a special finding it could have made that a written  motion for the last hearing to but they failed to do so so what we have instead is they essentially sat silent in the trial court except for one brief in terms of briefing into the last briefing they filed one brief arguments about the scope of discovery for the st time on appeal this is an end around the rules and shouldn't be allowed we don't have jurisdiction let me orient back to the issue of claims i disagree with many things that mr o'donnell said about the of the claim but what's critical here is caterpillar is seeking coverage under the traveler's policy as an additional ensure it is seeking the claim file and the reinsurance  created by travelers in the possession custody and control of travelers i said in the in the lower court and i say again mr o'donnell's firm which has been involved for some time in terms of the defen or asked that will produce alabama council's files however what we find ourselves in and is budget problems involves conduct we're getting nothing about the investigation of caterpillar claim under either the insurance policy or under the contractual indemnification provision that caterpillar has with vault this is a a stone wall all factual has the burden of asserting privilege many things they have sir they just assert i've heard things of this argument that i've never heard before counsel makes argument in the trial court without record sport i want to give an example just one example this is from page eight of the reply folk cope vote no however and travelers asserts comma that somewhere in those records this privilege information that travels received from vote for purpose of defending this lawsuit what's a record cite for that what's the any cite whatsoever there's nothing is a failure proof trowsers articulated that there were five votes not attorney employees who were on their it doesn't make a representations about a voltage reason for a communication that people are involved why it might be problems there is no factual predicate anywhere because it can be pointed to in the record for the assertions in the claims file in the reinsurance file created for the dominant purpose of transmitting them to attorney for the defense of all and the answer is really no there's nothing in the record indicating that any claims rock or any lloyds but again that mr o'donnell's argument moves the mark here because the question is not when boat it has been litigation but when travelers in despair that occasion because these are travelers documents how  folks then they broke off and made a nd claim file for the vault documents travel is treated as not adverse for purposes of insurance coverage i also want to go back to the issue of how i offered the defense counsel in alabama i propose mr mann who was the claims handler for travelers jim what were your communications with how  testimony from the claims handler he was talking to her about one of the reasons why we see these files is we have a notice issue in this case there was notice in may of two thousand and thirteen and was provided and travel as a st got it and said capital you're late that the gallagher bassett and the willis arguments and i really want to be crystal clear about this those documents are related to subpoenas issued by caterpillar to rd parties  take the documents in camera view those documents are not at issue on this appeal there there's nothing about the alabaster documents that are on appeal those are times are completely separate the documents are on of the issue of burden is an order because all assertions of any privilege here are very not pacific and it is obligation to prove privilege whether they do in the record to show any of the privileges there are certain is there any testimony or an affidavit and the answer is no just counsel's argument that's not sufficient to sustain  was as a result of fourteen brace and for all d arguments judge mccuskey spent an organ amount of time establishing the scope of discovery and in doing so if simply carved out  was going to confine the tender record evidence to what was used at trial or pretrial and used at the time the settlement but but the point is the court's ruling on the scope of discovery was correct that's correct thank you briefly as to the issue of the dominant purpose we can agree press his argument that that we don't know if there was a damage purpose or not that's because the three binders that we submitted to judge mccuskey pursuant to our motions for protective order that were filed to assert our privileges the st two binders pertain to a subpoena gallagher bassett our primary carers claim administrator and then the nd binder pertain to the subpoena sent claims consult wills powers those two binders judge mccuskey had in february and that's why the february order says that he's going to review those binders before he makes any determinations about issues of both privileges or coun to sit here and say that we sat on our rights is specious and frivolous and in fact i would point out to the court that there's a judicial admission made that i've already referenced on direct exam my direct argument that they said in the trial court before judg the hearing in march we are not trying to get underneath bolts put regarding the defense documents the traveller's presents despite that judicial admission and that concession ultimately they change course  was confused and didn't understand the fact that travelers had several hundreds of pages of documents of my reporting now travelers also has documents that came upstream before i was involved when i was hired february  th to defend the illinois st filed action to know of what the dominant purpose of travelers communications with bolt were with the eight volt employees that were communicating with travelers including our risk manager and hooting our in house that the rd binder of our privilege materials that didn't pertain to the gallagher bassett subpoena or the will subpoena our claims handlers our own claims documents the st two binders the rd binder there was other claims documents we consider to be confidential including other documents communicating with our insurers when they're suing us for forty some one million dollars that rd binder was never reviewed by judge mccuskey either and that is why judge mccuskey said at the hearing in august when he says turn over all these documents well i'm not doing that well i'm not addressing bill and i i just need to point out here that for counsel to say that we slept on our rights overlooks the february order that said judge mccuskey was going to review all their privilege documents in the st two binders and then overlooks the march order at paragraph six that they drafted that said that the court will refrain from addressing privileges has in traveller's documents until after it has reviewed the binders all three binders when when that order was entered in march we were still preparing the rd binder we provided that binder to the court then at the end of april i was recently in court last week on this case and judge mccuskey said you know what i'm retiring you better take those binders back because i never looked at them and they now i have the same binders we gave him two years ago that he never looked at the content to determine the privilege so for them to say we slept on something they drafted the order that said that he won't rule on our privileges until he looks at the documents this is a completely misleading argument to this court and a judicial admission was made in march that they did not want to get under our hood or get under our tent as judge mccuskey said you call in the midwest now irrespective of who had the st duty to defend the insured has to report to the excess carrier who has the duty to indemnify above the primary duty to defend and that's what was doing and that is abundantly important here i can't stress to this court now this is a simple decision for this court from our perspective they may have some claim to coverage analysis documents the traveller's holds on their claim to coverage but under illinois law there is no case law that says that they can sue us and then compel our insure to turn over the insurers privilege materials how do we decide if something's ordinary as they call it their position here is not supported by the law there's no holding in any appellate court a supreme court says ordinary claims documents are just discoverable by your adversary in litigation where forty million dollars is stake and that's why we have hundreds and hundreds of entries for a ten month period over these communications in these documents including our initial attorneys reporting back upstream he says that during my answers i looked at coverage with gary man was also handling the claim or vote at that time before the suit was filed thank you for your time today