Opinion ID: 174959
Heading Depth: 3
Heading Rank: 2

Heading: Standard for discovery related to a dual role conflict of interest

Text: Just as our cases have not clearly delineated between supplementation of the record with evidence of a claimant's eligibility for benefits and supplementation with evidence of the seriousness of a conflict of interest, our cases have also failed to articulate in plain terms the standard for discovery beyond the administrative record related to a dual role conflict of interest of an ERISA plan administrator. The Supreme Court in Glenn counseled against special procedural and evidentiary rules in this context. 128 S.Ct. at 2351. We take that counsel to apply also to discovery rules, which in this case will then be governed by the familiar standards of Federal Rule of Civil Procedure 26(b). As stated previously, in Glenn, the Supreme Court held that the district court weighs a dual role conflict as one factor in its abuse of discretion analysis, allocating it more or less weight depending on its seriousness. 128 S.Ct. at 2350-51. In reaching this conclusion, the Supreme Court rejected other approaches to handling a dual role conflict, such as shifting to the administrator the burden of proving its decision was reasonable. See Holcomb 578 F.3d at 1192-93 (explaining that Glenn abrogated our burden-shifting scheme). Glenn explained that it was not necessary or desirable for courts to create special burden-of-proof rules, or other special procedural or evidentiary rules, focused narrowly upon the evaluator/payor conflict. 128 S.Ct. at 2351. We take Glenn 's admonition against special rules to apply beyond the particular issue addressed in Glenn. We think it also commands that we not create any special rules for discovery related to a dual role conflict of interest. Instead, we must apply Federal Rule of Civil Procedure 26(b) to discovery requests seeking information related to a dual role conflict of interest, just as we would apply that rule to other discovery requests. Although Rule 26(b) will govern these (and other) discovery requests in ERISA cases, we emphasize that neither a claimant nor an administrator should be allowed to use discovery to engage in unnecessarily broad discovery that slows the efficient resolution of an ERISA claim. In fact, for the reasons that follow, discovery related to a conflict of interest may often prove inappropriate. Rule 26(b) will not permit unlimited discovery. Rule 26(b)(1) permits discovery only of [r]elevant information and the discovery must appear[] reasonably calculated to lead to the discovery of admissible evidence. Moreover, all discovery is limited by Rule 26(b)(2), which protects against, inter alia, overly burdensome discovery requests, discovery of cumulative materials, and overly costly discovery requests. See Fed.R.Civ.P. 26(b)(2)(C)(i) & (ii); cf. Hall, 300 F.3d at 1203 (explaining that even in de novo review [c]umulative or repetitive evidence. . . should not be admitted). In exercising its discretion over discovery matters under Rule 26(b), district courts will often need to account for several factors that will militate against broad discovery. First, while a district court must always bear in mind that ERISA seeks a fair and informed resolution of claims, ERISA also seeks to ensure a speedy, inexpensive, and efficient resolution of those claims. See Jewell, 508 F.3d at 1308 (noting ERISA's goal of prompt resolution of claims by the fiduciary) (quotation omitted). And while discovery may, at times, be necessary to allow a claimant to ascertain and argue the seriousness of an administrator's conflict, Rule 26(b), although broad, has never been a license to engage in an unwieldy, burdensome, and speculative fishing expedition. See Fed.R.Civ.P. 26(b) & (b)(2); see also Crawford-El v. Britton, 523 U.S. 574, 598, 118 S.Ct. 1584, 140 L.Ed.2d 759 (1998) (Rule 26 vests the trial judge with broad discretion to tailor discovery narrowly.). The party moving to supplement the record or engage in extra-record discovery bears the burden of showing its propriety. Cf. Hall, 300 F.3d at 1203 (explaining that, where district court reviews an administrator's decision de novo, [t]he party seeking to supplement the record bears the burden of establishing why the district court should exercise its discretion to admit particular evidence by showing how that evidence is necessary to the district court's de novo review). Second, in determining whether a discovery request is overly costly or burdensome in light of its benefits, the district court will need to consider the necessity of discovery. Cf. Hancock v. Metro. Life Ins. Co., 590 F.3d 1141, 1155 (10th Cir.2009) (explaining that a conflict of interest affects the outcome at the margin, when we waver between affirmance and reversal). For example, the benefit of allowing detailed discovery related to the administrator's financial interest in the claim will often be outweighed by its burdens and costs because the inherent dual role conflict makes that financial interest obvious or the substantive evidence supporting denial of a claim is so one-sided that the result would not change even giving full weight to the alleged conflict. [7] Similarly, a district court may be able to evaluate the effect of a conflict of interest on an administrator by examining the thoroughness of the administrator's review, which can be evaluated based on the administrative record. And, without further discovery, a district court may allocate significant weight to a conflict of interest where the record reveals a lack of thoroughness. The above considerations are simply some factors a district court may include in its calculus when addressing a discovery request in an ERISA case. A district court has substantial discretion in handling discovery requests under Rule 26(b). See Motley v. Marathon Oil Co., 71 F.3d 1547, 1550 (10th Cir.1995) (Generally, control of discovery is entrusted to the sound discretion of the trial courts[.]) (quotation, alteration omitted). Although in exercising that discretion the district court must bear in mind both the need for a fair and informed resolution of the claim and the need for a speedy, inexpensive, and efficient resolution of the claim, we will not disturb a district court's exercise of discretion unless it has abused that discretion. See Ridenour v. Kaiser-Hill Co., 397 F.3d 925, 938 (10th Cir.2005) (We review discovery rulings for an abuse of discretion.).