Opinion ID: 3183595
Heading Depth: 1
Heading Rank: 2

Heading: Proceedings During Discovery

Text: During the discovery process, State Farm reformed the three policies to provide uninsured motorist coverage equal to the liability coverage limits of each policy and paid 3 W.Va. Code, 33-6-31d [1993], states in part: (a) Optional limits of uninsured motor vehicle coverage and underinsured motor vehicle coverage required by section thirty-one [W.Va. Code, 33-6-31] of this article shall be made available to the named insured at the time of initial application for liability coverage and upon any request of the named insured on a form prepared and made available by the Insurance Commissioner. 4 A number of unfair claim settlement practices are listed in subparts (a) through (o) of W.Va. Code, 33-11-4(9) [2002], each relating to a “general business practice” within the insurance industry. For example, W.Va. Code, 33-11-4(9)(a) [2002], states: No person shall commit or perform with such frequency as to indicate a general business practice any of the following: (a) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue. See also West Virginia Code of State Rules § 114-14-1 (2006), et seq., (addressing unfair trade practices in the insurance industry). 5 Bassett additional uninsured motorist benefits in the amount of $240,000.5 Thus, according to Bassett, the requested declaratory judgment (a breach of contract claim) concerning the amount of uninsured motorist coverage available is no longer an issue since Bassett prevailed in that regard. The focus of the litigation, therefore, became Bassett’s claim that State Farm had engaged in unfair claim settlement practices. Interrogatories 3, 4 and 5 of Bassett’s Third Set of Interrogatories to State Farm were sharply contested. Those Interrogatories sought information regarding offers of uninsured motorist coverage to other State Farm insureds: 3. Identify by name, address and telephone number every State Farm insured in the State of West Virginia, from 2005 to the present, who was injured by or suffered property damage as a result of the acts of an uninsured motorist and whose policy did not have uninsured motorists coverage limits at least equal to the liability limits stated in the insured’s policy declarations [or] $100,000, whichever is greater. You may exclude from this response all insureds who obtained a judgment against the uninsured tortfeasor for less than the stated uninsured motorists coverage limits afforded by the State Farm policy or who settled his/her claim for uninsured motorists benefits for less than the stated uninsured motorists coverage limits afforded by the State Farm policy. 4. Identify the State Farm insured named in response to Interrogatory No. 3 who received payment under a State Farm policy for uninsured motorists 5 According to State Farm’s petition filed in this Court, it also paid Bassett $102,578 for aggravation, inconvenience and attorney fees. That amount, plus the $60,000 and the $240,000 in uninsured motorist benefits, equals a total payment to Bassett in the amount of $402,578. 6 benefits where the “Uninsured Motorist Coverage Offer” form listed more than a single premium for each optional level of uninsured motorists coverage. 5. Identify every claim in the State of West Virginia from 2005 to the present where State Farm has “rolled-up” or reformed an insured’s stated limits of uninsured motorists coverage to an amount equal to the insured’s liability coverage limits or $100,000, whichever is greater, indicating the claim number, the name, address and telephone number of the insured, and the reason or reasons the policy was reformed. In its answer to the Third Set of Interrogatories, State Farm objected to Interrogatories 3, 4 and 5 on several grounds: (1) The Interrogatories were overly broad and burdensome; (2) they sought information for certification of a class action which had not been mentioned in the amended complaint; and (3) the Interrogatories sought information “the discovery of which would violate the privacy and confidentiality interests of State Farm Mutual Automobile Insurance Company insureds.”6 In May 2015, the circuit court entered the parties’ agreed protective order which stated that documents provided by State Farm in response to discovery requests would be considered confidential and would not be filed with the circuit court unless under seal. The 6 State Farm’s answer to Bassett’s Third Set of Interrogatories included a list of first-party lawsuits filed against State Farm in West Virginia from January 1, 2010, through March 18, 2015, which contained allegations of bad faith and/or unfair trade practices. The list, consisting of approximately 200 cases, identified the style of each action, the docket number, and the circuit court. The information was provided in answer to Interrogatory No. 6 of Bassett’s Third Set of Interrogatories. 7 agreed protective order did not specifically address Interrogatories 3, 4 and 5 of Bassett’s Third Set of Interrogatories. On July 7, 2015, Bassett filed a motion to compel complete answers to Interrogatories 3, 4 and 5 of the Third Set of Interrogatories. Bassett stated that his claims were based on State Farm’s failure to use the proper form for offering optional (additional) coverage promulgated by the West Virginia Insurance Commissioner. Bassett asserted that, to show unfair claim settlement practices, he was entitled to discover the type of selection/rejection offering form for added coverage State Farm had used with other insureds, and whether, with or without litigation, State Farm had paid additional coverage where the form was clearly defective. According to Bassett, that information would also support his claim for punitive damages by establishing how often State Farm engaged in misconduct. The circuit court granted the motion to compel and directed State Farm to disclose the information requested in Interrogatories 3, 4 and 5. The circuit court concluded that the information sought was relevant to Bassett’s allegation of unfair claim settlement practices and his claim for punitive damages. The order, entered on October 5, 2015, allowed State Farm to disclose the information pursuant to the agreed protective order. 8 State Farm filed a motion to reconsider alleging that it had identified over 400 nonparty insureds who have no interest in this litigation and whose privacy rights are not protected by the order granting Bassett’s motion to compel. State Farm asserted, in the alternative, that the May 2015 agreed protective order is inadequate and that a new protective order should be entered (1) to prevent disclosure of (or redact) the names, addresses and telephone numbers of the non-party insureds and (2) if such information is filed in the circuit court, to prevent Bassett from contacting the non-party insureds without their advance consent. On October 29, 2015, the circuit court entered an order denying State Farm’s motion to reconsider the ruling granting Bassett’s motion to compel. With regard to State Farm’s request for a new protective order, the circuit court stated: The names, addresses and telephone numbers of non-parties disclosed by [State Farm] shall not be disclosed outside the context of the present litigation without further order of the Court. Further, while the Court declines at this time to prohibit [Bassett] from contacting non-party individuals, said contact shall be performed in a manner designed to cause the least possible intrusion to the lives of said individuals. Should the Court receive complaints regarding the nature of said contact, the same may be suspended by Order of the Court without further notice or hearing. Thereafter, State Farm filed this proceeding seeking to prohibit the enforcement of the October 29, 2015, order and the previous order granting Bassett’s motion to compel. State 9 Farm asks this Court to direct that the motion to compel be denied. In the alternative, State Farm asks this Court to redact the non-party insureds’ identifying information or preclude Bassett from contacting the non-party insureds without their advance consent.