JD Supra

Insurers and reinsurers regularly communicate regarding matters they view as confidential. These communications often relate to claims, both routine and litigated, by the underlying insureds. Insureds, in turn, seek discovery of these communications when claims become contentious and litigated. Recent federal court decisions in Minnesota and Texas demonstrate the willingness of courts to permit discovery of communications between insurance companies and their reinsurers. Conversely, a federal court in Indiana recently rejected requests for reinsurance communications. These cases illustrate the difficultly faced by insurers and reinsurers in understanding the discoverability of their communications prior to litigation. Although insurers and reinsurers may view their communications as confidential, they must be mindful of the potential discoverability of these communications, particularly when litigated claims are involved.

Text messages, once the exclusive domain of teenagers and college students, are increasingly used in business communications. These communications are, unsurprisingly, also discoverable in a wide variety of litigation contexts, from employment lawsuits to products liability actions. Most importantly, courts, such as the Eastern District of Louisiana in U.S. v. Mix (United States v. Mix, 2013 U.S. Dist. LEXIS 146848)and the District of Colorado in Christou v. Beatport, LLC (Christou v. Beatport, LLC, 2013 U.S. Dist. LEXIS 9034), have issued sanctions against litigants who have failed to preserve text messages.

The discovery of electronically stored information (ESI) is loaded with potential pitfalls and failure unless the parties add two components to the mix: cooperation and collaboration. Lacking those components, ESI discovery, at least sometimes, can be one of the more painful experiences for the average trial lawyer. The problem to overcome is largely that trial lawyers, by their nature, are competitive souls and tend toward competition rather than cooperation. Add to this personality that of the client who expects her lawyer to win everything, every time and we are off to the races. In a recent case, the Honorable Magistrate Judge Peggy Leen seems to deal with overly competitive parties and lawyers not inclined toward collaboration; in the recent decision in Progressive Casualty Insurance v. Delaney, 2014 WL 2112927 (D. Nev. May 20, 2014).

n the U.S District Court for the Northern District of Illinois, Judge Matthew F. Kennelly recently held that plaintiffs alleging price-fixing in the text messaging market were not entitled to an adverse inference after failing to prove that defendants T-Mobile and CTIA destroyed emails in bad faith. Judge Kennelly also granted the defendants’ motion for summary judgment, as plaintiffs were unable to meet the elevated pleading burden for collusion to fix prices for text messages in violation of the Sherman Antitrust Act. The plaintiffs had filed suit on behalf of customers who used pay-per-text-message services from Verizon Wireless, AT&T, Sprint, and T-Mobile. The Wall Street Journal published an article in September 2008, titled “Text Messaging Rates Come under Scrutiny,” inspired primarily by the antitrust investigation of Senator Herbert Kohl.[1] The day the article was published, a T-Mobile employee allegedly sent the text of the article via e-mail to both Adrian Hurditch, the company’s former Vice President of Services and Strategic Pricing, and Lisa Roddy, the company’s former Director of Marketing Planning and Analysis. Hurditch and Roddy e-mailed each other about the article; however, that e-mail thread no longer exists.