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Texas Court of Appeals Limits Discovery of Insurer's Claim Files

Insurance Law Update

June 2009
By: Michael Diksa

Texas Court of Appeals, Houston

In In re Steadfast Ins. Co., 2009 WL 1424634 (Tex. Ct. App. May 18, 2009), the Texas Court of Appeals, Houston, First District, granted a petition for writ of mandamus filed by Steadfast Insurance Company and overturned a trial court order compelling production of claim files requested from the insurance carrier for a 10-year period.

In the trial court, the requesting party sought the identity of all insurance claims in which Steadfast had been alleged to have acted in bad faith or in breach of an insurance policy with respect to a claim against its insureds for a 10-year period, as well as the production of Steadfast’s claim files for all such claims. Steadfast objected to the requests as overbroad and unduly burdensome, and the requesting party filed a motion to compel. The trial court ordered the production of the requested information to the extent the claims had developed into a lawsuit to which Steadfast had been a party.

Steadfast sought mandamus relief with the Court of Appeals, which was granted on May 18, 2009. In reaching its decision, the Court of Appeals found that the discovery requests were overbroad and not narrowly tailored, thereby constituting an “impermissible fishing expedition.” In this regard, the Court of Appeals held that a discovery request requiring a 50-state search over a 10-year period is overbroad as a matter of law.

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