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Yost v. Anthem Life Insurance Co.

United States District Court, M.D. Pennsylvania

July 29, 2019

ERIC YOST, individually and on behalf of a class of similarly situated individuals, Plaintiff,
v.
ANTHEM LIFE INSURANCE COMPANY Defendant.

          MEMORANDUM OPINION

          Robert D. Mariani United States District Judge.

         I. INTRODUCTION

         Here the Court considers Defendant Anthem Life Insurance Company's Motion for Protective Order (Doc. 88). With this Motion, Defendant asserts that Plaintiff should be allowed to conduct discovery "with regard to his contended claim for breach of fiduciary duty as a result of contended conflict of interest only with respect to those topics of testimony from the four Fed.R.Civ.P. 30(b)(6) notices of deposition served on August 10, 2018 as limited in the manner requested" by the pending motion. (Doc. 88 at 1.) Specifically, Defendant requests that the Court issue a protective order "precluding Plaintiff from taking testimony pursuant to the "Plan Attorney" Notice of Deposition and limiting the subjects regarding which it may be deposed by Plaintiff on the remaining outstanding notices of deposition to those that have not been the subject of the previous June 14, 2018 Rule 30(b)(6) Notice of Deposition." (Id. at 16.) For the reasons discussed below, Defendant's motion will be granted in part and denied in part.

         II. PROCEDURAL HISTORY

         Plaintiff Eric Yost, individually and on behalf of a class of similarly situated individuals, filed a putative class action complaint on December 11, 2015, in the Court of Common Pleas of Pike County. (Doc. 2-1). The Complaint alleged three counts. In Count I, Plaintiff sought a declaratory judgment that Defendant may not obtain reimbursement, or assert a right of subrogation against the proceeds of personal injury settlements or verdicts, on motor vehicle claims in accordance with Pennsylvania's Motor Vehicle Financial Responsibility Law, 75 Pa. C.S. § 1720 ("MVFRL"). (Id. at 16-20.) Count II of the Complaint asserted a claim for unjust enrichment. (Id. at 21-25.) In Count III, Plaintiff brought a claim for bad faith. (Id. at 26-34.) On January 21, 2016, Defendant removed the action to this Court. (Doc. 1.) Thereafter, Defendant filed a Motion to Dismiss, maintaining that the Employee Retirement Income Security Act, 29 U.S.C. § 1001 et seq. ("ERISA") preempted Plaintiffs claims. (Doc. 7.) The Court granted the motion in part and denied it in part. (Doc. 23.)

         Plaintiff filed his Amended Complaint (Doc. 26) on August 18, 2016. The Amended Complaint contains seven counts: Count I for Violation of 75 Pa. C.S.A. § 1720 - Rule of Decision (id. at 15-16); Count II for Declaratory Relief (id. at 16-20); Count III for Violation of Employee Welfare Benefit Plan and Policy (id. at 20-21); Count IV for Breach of Fiduciary Duty - Misrepresentation (id. at 22-24); Count V for Breach of Fiduciary Duty - Duty of Loyalty (id. at 24-27); and Count VI which identifies "Relief Demanded" (id. at 27-34). Defendant filed a motion to dismiss the Amended Complaint (Doc. 30) which the Court granted in part and denied in part (Doc. 39). Specifically, the Court found that, based on the analysis set out in the Memorandum Opinion (Doc. 38), Count I (Rule of Decision) was not properly pled as an independent claim for relief, but contained allegations integral to Count II. (Doc. 39 ¶ 1.) The Court therefore construed the allegations in Count I (Doc. 26 ¶¶ 72-76) as incorporated into Count II (Declaratory Relief) of the Amended Complaint pursuant to Fed.R.Civ.P. 8(f). (Id.) The Court found Count VI (Relief Demanded) to be a statement of requested relief and, therefore, the title "Count VI" was stricken from the Amended Complaint (Doc. 26 at 27) and the allegations in Count VI were construed as a prayer for relief. (Doc. 39 ¶ 2.) Regarding Count III, subparagraphs (7)-(13) under Relief Demanded for Count III of the Amended Complaint (Doc. 30 at 29-30), as well as all references to "mandamus" under the Relief Demanded section of the Amended Complaint (Doc. 29 at 29, 31, 33) were stricken. (Doc. 39 ¶ 3.) Count IV (Breach of Fiduciary Duty-Misrepresentation) of the Amended Complaint (Doc. 26 ¶¶ 102-114) was dismissed with prejudice for failure to state a claim pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. (Doc. 39 ¶ 4.) Defendant's Motion to Dismiss was denied as to Count II (Declaratory Relief), Count III (Violation of Employee Welfare Benefit Plan and Policy), and Count V (Breach of Fiduciary Duty - Duty of Loyalty). (Doc. 39 ¶ 5.)

         Plaintiff filed Plaintiffs Motion for Leave of Court to Amend the Complaint (Doc. 55) and a supporting brief (Doc. 56) on July 3, 2018. Defendant filed its opposition brief (Doc. 65) on July 17, 2018. A telephonic status conference was held on July 18, 2018. (See Doc. 67.) On July 31, 2018, Plaintiff withdrew Plaintiffs Motion for Leave of Court to Amend the Complaint (Doc. 55). (Doc. 71.)

         On July 3, 2018, Defendant filed two motions: Defendant Anthem Life Insurance Company's Dispositive Motion to Deny Class Certification (Doc. 57), and Defendant Anthem Life Insurance Company's Motion for Partial Summary Judgment (Doc. 58). By Orders of March 29, 2019, the Court denied both motions without prejudice. (Docs. 92, 93.) The Court noted that it would set a new dispositive motion deadline following disposition of Defendant Anthem Life Insurance Company's Motion for Protective Order. (Doc. 93 at 3 ¶ 2.)

         In correspondence dated July 31, 2018, Plaintiffs counsel requested the Court's assistance in resolving several issues and asked that a conference be scheduled to address the matters identified. (Doc. 72.) One issue related to the Breach of Fiduciary Duty claim contained in Plaintiffs Amended Complaint which survived Defendant's motion to dismiss. (Id. at 1.) Counsel asserted that he attempted to schedule a deposition on this claim and Defendant refused to produce a deponent. (Id.) In response to the correspondence, the Court issued an Order on August 7, 2018, stating that Plaintiffs letter did not provide sufficient detail to determine whether to hold a conference or direct the parties to file a formal motion. (Doc. 76 at 2.) Therefore, the Court directed further clarification of the issues. (Id. at 4.) The Court also directed the parties to proceed by way of formal motion should any new discovery issues arise. (Id.)

         In correspondence to the Court dated August 10, 2018, Plaintiffs counsel again indicated that the parties were unable to resolve all discovery disputes. (Doc. 79 at 1.) One issue identified was related to the "Breach of Fiduciary Duty Deposition." [Id. at 5.) Plaintiffs counsel noted that the parties may have a resolution to this matter and a new deposition notice had been drawn. (Id.) Defendant's counsel responded by correspondence of August 14, 2018, and stated the following regarding depositions related to the breach of fiduciary duty claim:

Plaintiff served Anthem Life with Rule 30(b)(6) notices of deposition with regard to Plaintiffs breach of fiduciary duty claim based on conflict of interest on Friday, August 10, 2018. While Anthem Life still needs to comprehensively review these notices, it notes that the topics of testimony identified in the notices is extremely broad and far-ranging and appear to address many topics well beyond a contended breach of fiduciary duty through the inherent, yet inchoate, conflict of interest identified by the Supreme Court in Metropolitan Life Insurance Co. v. Glenn, 554 U.S. 105 (2008).
Nevertheless, Anthem Life will respond to these notices in good faith. If any disputes ultimately arise from these notices, Anthem Life presumes that the parties will address such disputes by way of formal motion as set forth in this Court's August 7, 2018 Order (Doc. No. 76).

(Doc. 80 at 5.)

         By Order of August 16, 2018, the Court addressed the Rule 30(b)(6) depositions as follows:

with respect to the Rule 30(b)(6) depositions relating to the Breach of Fiduciary Duty claim, Defendant has averred that it is still reviewing the deposition notices and "will respond to these notices in good faith." Doc. 80 at 5. Thus, Plaintiffs request for Rule 30(b)(6) desposition(s) is granted; Defendant shall designate one or more officers, directors, managing agents, or any other persons who consent to testify on its behalf for a deposition to be taken by Plaintiff. If any dispute arises from this deposition notice or any other issued by either party, the parties shall address such disputes by way of formal motion as in accordance with this Court's August 7, 2018 Order. Doc. No. 76.

(Doc. 81 at 4-5.) At the time, the Court was not provided with copies of the August 10, 2018, notices.

         On August 28, 2018, the parties filed the Motion to Adjourn Deposition and to Adjust Case Schedule Pending Anthem Life's Motion for Protective Order (Doc. 85). The Court granted the motion, ordering that the depositions currently scheduled be adjourned, allowing Defendant time to file a motion for a protective order, and holding the case schedule in abeyance pending the Court's decision on the motion. (Doc. 86.)

         Defendant Anthem Life Insurance Company's Motion for Protective Order (Doc. 88), the Motion now under consideration, was timely filed and is fully briefed and ripe for disposition.

         III. STATEMENT OF FACTS

         A. Plaintiff's Amended Complaint

         The following facts are taken from Plaintiffs Amended Complaint. (Doc. 26.) Plaintiff Eric Yost was insured for disability benefits under a Group Plan issued by Defendant through Finisar Corporation, Plaintiffs former employer. (Doc. 26 ¶ 6.) On February 2, 2013, Plaintiff was injured in a of a motor vehicle accident, rendering him temporarily disabled. (id. ¶ 7.) As a result of his temporary disability, Plaintiff submitted a claim for short term disability benefits to Defendant. (Id. ¶ 8.) Thereafter, Defendant paid disability benefits in the amount of $5, 654.40 to Plaintiff for the period beginning February 4, 2013 and ending April 23, 2013. (Id. ¶ 9.) As a result of his injury, Plaintiff sought damages against the alleged tortfeasor. (Id. ¶ 10.) The tortfeasor's insurer settled the action and made payment to Plaintiff in compensation for the personal injuries he sustained in the motor vehicle accident. (Id. ¶ 11.) Defendant then asserted a claim for reimbursement of the short term disability benefits paid to the Plaintiff in the amount of $6, 997.25. (Id. ¶¶ 12, 14.) The parties then attempted to negotiate a settlement as to the reimbursement Defendant asserted it was owed by Plaintiff. (Id. ¶¶ 14-20.) Defendant has continued to assert a claim for reimbursement of the short term disability benefits paid to the Plaintiff. (Id. ¶ 24.) As a result, Plaintiffs counsel "has been forced to refuse to distribute to Mr. Yost the money in dispute" (id. ¶ 26), leaving Plaintiff "subject to suit and loss of benefits based on the dispute over the subject funds" (id.).

         B. Defendant Anthem Life Insurance Company's Motion for Protective Order

         The following facts are taken from Defendant's brief in support of the pending motion supplemented by facts of record the Court deems relevant. (Doc. 88-1 at 6.) The Court relies on Defendant's factual recitation because Plaintiffs opposition contains no counter-statement of the facts (see Doc. 89), and Defendant's statement (Doc. 88-1 at 6-9) is properly deemed adopted pursuant to Rule 7.8(a) of the Middle District of Pennsylvania Rules of Court.

Before serving the deposition notices at issue with the pending motion,
Plaintiff served an initial Fed.R.Civ.P. 30(b)(6) deposition notice (hereinafter the "June 14, 2018 Notice of Deposition") on Anthem Life that called, generally, for testimony regarding Anthem Life's subrogation activities regarding motor vehicle accident disability claims made by putative class members and also testimony regarding the search for, identification of, and production of documents in response to Plaintiffs first requests for production of documents on both an individual and class basis. Anthem Life identified, prepared, and produced a witness-Louise Patton -to testify as its corporate representative. That Rule 30(b)(6) deposition went forward for approximately four hours on June 14, 2018.

(Doc. 88-1 at 6-7.) Since this deposition, Patton retired and is no longer employed by Defendant. (Id. at 7 n.1.)

         Following the deposition, Patton subscribed to a declaration on June 25, 2018, identifying her position as Director of Life & Disability Claims Operations. (Doc. 88-6 at 2.) The declaration was submitted in support of Defendant Anthem Life Insurance Company's Dispositive Motion to Deny Class Certification (Doc. 57). (Doc. 88-1 at 8.) The declaration details aspects of Defendant's search for, identification of, and production of documents responsive to Plaintiffs first set of individual and class requests for production of documents and includes details of that process that were not explored by Plaintiff in examination at the June 14, 2018, Rule 30(b)(6) deposition. (Id. at 7.)

         At some time after the June 14, 2018, deposition, Defendant agreed to produce a witness to testify regarding fiduciary duty topics. (Doc. 88-1 at 8.) Defendant agreed to do so because Plaintiff wanted to examine fiduciary duty topics at Patton's deposition though such topics had not been identified in any notice of deposition. (Id.) As a result of the agreement, Plaintiff issued four deposition notices on August 10, 2018. (Id.) These are the deposition notices that are the subject of Defendant's pending motion. (Doc. 88.)

         IV. ANALYSIS

         Defendant states that it seeks a protective order "in connection with a series of Fed.R. Civ. P. 30(b)(6) deposition notices issued by Plaintiff that seek impermissibly to intrude on the attorney-client privilege and constitute impermissible attempts at second corporate representative depositions of the same party on the same topics without good cause or court permission." (Doc. 88-1 at 4.) Defendant posits that the August 10, 2018, notices are not limited to the subject of Plaintiffs fiduciary duty/conflict of interest claim and seek to revisit the same subject matter that Plaintiff should have explored at the June 14, 2018, deposition, i.e., Defendant's search for, identification of, and production of documents. (Doc. 88-1 at 8-9.) As required by Rule 7.8(a) of the Middle District of Pennsylvania Rules of Court, Defendant provides a Statement of Questions Involved:

1. Should the Court issue a protective order forbidding Plaintiff from deposing Anthem Life pursuant to the "Plan Attorney" Notice of Deposition where Topics 1 and 3 of the notice seek to impermissibly invade the attorney-client privilege and where the discovery previously produced demonstrates there were no communications satisfying Topic 2?
2. Should the Court issue a protective order forbidding Plaintiff from deposing Anthem Life pursuant to Topic 5 of the "Patton 1" Notice of Deposition to the extent it inquires about Plaintiffs first requests for production of documents?
3. Should the Court issue a protective order forbidding Plaintiff from deposing Anthem Life pursuant to the "Patton 2" Notice of Deposition where the notice seeks to impermissibly re-depose Anthem Life on the same topics that were noted as the subject matter of the June 14, 2018 Rule 30(b)(6) deposition?
4. Should the Court issue a protective order forbidding Plaintiff from deposing Anthem Life pursuant to Topic 1 of the "Pruitt" Notice of Deposition to the extent it inquires about Paragraphs 11 through 15 of the Declaration of M. Catherine Pruitt?
5. Should the Court issue a protective order forbidding Plaintiff from deposing Anthem Life pursuant to Topic 2 of the "Pruitt" Notice of Deposition where the topic seeks to impermissibly re-depose Anthem Life on a topic on which Anthem Life was already deposed on June 14, 2018?

(Doc. 88-1 at 9-10.)[1]

         It is well-established that a party wishing to obtain a protective order must demonstrate that "good cause" exists for the order of protection. Pansy v. Borough of Stroudsburg, 23 F.3d 772, 786 (3d Cir. 1994) (citing Fed.R.Civ.P. 26(c)). Upon a showing of good cause, the court may "issue an order to protect the party... from annoyance, embarrassment, oppression, or undue burden or expense." Fed.R.Civ.P. 26(c)(1). Pertinent provisions of Federal Rule of Civil Procedure Rule 30 provide the following:

(a) When a Deposition May Be Taken.
(1) Without Leave. A party may, by oral questions, depose any person, including a party, without leave of court except as provided in Rule 30(a)(2). The deponent's attendance may be compelled by subpoena under Rule 45.
(2) With Leave. A party must obtain leave of court, and the court must grant leave to the extent consistent with ...

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