Delaware Business Litigation Report

Federal Court Denies Defendant's Motions Including Under Fed.R.Civ.P. 30(b)(6)

Westchester Fire Ins. Co. v. Household Intern., Inc., No. Civ. A. 02-1328 JJF, 2005 WL 23351 (D.Del. Jan. 5, 2005), aff'd, 167 Fed.Appx. 895 (3d Cir. 2006). In this opinion the Court considered: (1) Plaintiff's Motion For Protective Order; (2) Defendants' Motion To Compel Discovery Relating To Financial Institutions Endorsement; (3) Defendants' Motion To Compel Deposition Of Westchester's Corporate Representative Witness; and (4) Defendants' Motion To Compel Discovery Relating To Westchester's Denials And Defenses. The Court denied all of defendants motions and held plaintiff's motion moot. Defendants claimed that the plaintiff committed fraud by selling comprehensive liability insurance to the defendants that did not possess the claimed value. Claims of consumer fraud against the defendants underlie this suit, in connection with the sale or financing of satellite-based television systems and other consumer products. Defendant Beneficial National Bank USA ("Beneficial") lost a summary judgment motion in favor of the plaintiff in 1998. That claim of declaratory relief "concern[ed] coverage of fraudulent lending claims involving credit card accounts." The Court had granted summary judgment to Plaintiff Westchester in that action holding that a Financial Institutions Endorsement ("FIE") "excluded coverage for predatory lending claims." In May 2002, Household International, Inc., Household Retail Services, Inc., and Household Bank (SB), N.A. (collectively, "Household") filed suit in Illinois alleging fraud counts against Westchester involving inducement to purchase insurance policies that excluded coverage for errors and omissions claims ("E&O"). That case was transferred to this Court and consolidated with Westchester's action that sought a declaration that "predatory lending claims were not covered by any Westchester policy." In their first motion, defendants sought to compel production of documents that allegedly related to the drafting, meaning, interpretation, or intent driving the FIE. Alternatively, defendants sought a Fed.R.Civ.P. 30(b)(6) witness to examine Westchester's knowledge on the FIE. The Court denied the defendants' motion because they did not demonstrate the relevance of their request as it related to the FIE. The Court also dismissed the second motion with regard to the designation of a corporate representative for a Fed.R.Civ.P. 30(b)(6) deposition because the defendants did not demonstrate that it was reasonably calculated to lead to discovery of admissible evidence. The Court declined to grant the defendants third motion relating to the adequacy of a particular interrogatory response of the plaintiff and left it to the parties to resolve the dispute. It however permitted the defendants to renew the motion if required. Plaintiff Westchester's motion sought to limit or vacate the scope of Fed.R.Civ.P. 30(b)(6) witnesses sought from It by the defendants. Because the Court had determined that the discovery requests of the defendants were not relevant under Fed.R.Civ.P. 26, the Court denied the Plaintiff's Motion For Protective Order as moot. Authored by: Raj Srivatsan 302.888.6831 rsrivatsan@morrisjames.com Share