United States District Court, E.D. Texas, Sherman Division
PARK BOARD LTD. Plaintiff,
STATE AUTOMOBILE MUTUAL INSURANCE COMPANY and DANIEL PROUGH, Defendants.
MEMORANDUM OPINION AND ORDER
L. MAZZANT UNITED STATES DISTRICT JUDGE
before the Court is Brett Lochridge's Motion to Quash or,
in the Alternative, Modify Subpoena (Dkt. #71). Having
considered the Motion and the relevant pleadings, the Court
finds that the Motion is GRANTED in part and
DENIED in part.
Park Board Ltd. (“Park Board”) purchased an
insurance policy (the “Policy”) from Defendant
State Automobile Mutual Insurance Company (“State
Auto”) in January 2017 for a commercial building in
Collin County. The Policy includes a clause entitling the
insurer and insured to an “appraisal, ” which
determines the amount of loss to damaged property if the
Parties disagree on the initial valuation. Either
side may demand an appraisal, which prompts each side to
select its own appraiser. The chosen appraisers subsequently
select a third-an “umpire”-or have one appointed
by the Court. Working together, the group will determine the
appropriate amount of damage.
March and April of 2017, Park Board's property sustained
damage from severe wind and hail storms. Park Board reported
a claim to State Auto immediately. State Auto's adjuster
assessed the claim and found a damage amount of $8, 097.85
(below the policy's $26, 006.00 deductible) (Dkt. #42,
Exhibit 1 at p. 1, 3). Because the adjuster determined the
damage to be less than the Policy's deductible, State
Auto informed Park Board that it would not pay the claim via
email on April 7, 2017 (Dkt. #42, Exhibit 1 at p. 1). Park
Board contends that State Auto failed to conduct a good faith
investigation into the damages and that a reasonable insurer
would not have valued the claim so low. Not satisfied with
the result from the adjuster, Park Board sought to initiate
appraisal pursuant to the Policy in January 2018 (Dkt. #30,
¶ 32). According to Park Board, State Auto denied the
request for appraisal in breach of the Policy. In response,
Park Board filed suit in April 2018, a year after the storm
occurred. The Parties ultimately initiated the appraisal
process in August 2018.
Auto's appraiser and the umpire signed and issued their
findings in April 2019. The appraisers found that it would
cost $211, 546.56 to purchase replacement parts for any
damages to the property. They also found that, at the time
the wind and hail storms hit, the parts of the property that
were damaged had already depreciated in value by $80, 165.61.
This means that the “actual cash value” of the
parts needing repairs amounted to $131, 380.95. State Auto
provided Park Board with a check for $49, 531.29 shortly
after. Due to the deductible and prior payments State Auto
had made to Park Board, this payment ensured that the $131,
380.95 “actual cash value” determination was
satisfied. Under some circumstances, the Policy
provides Park Board with the full replacement cost
for damage to its property-including the amount of
depreciation. State Auto informed Park Board that it would
pay the $80, 165.16 depreciation amount once repairs were
completed. But it also advised that Park Board has
“2 years from the date of the loss in which to
actually complete the repairs in order to collect the balance
of the damages”-a date that has passed. (Dkt.
#39, Exhibit 4 at p. 3) (emphasis in original).
April 22, 2019, State Auto filed Defendants State Automobile
Insurance Company and Daniel Prough's Motion to Dismiss
(Dkt. #39). The Court granted in part and denied in part
State Auto's Motion. As the Court stated,
“Plaintiff's claims [were] dismissed only to the
extent they [sought] damages for policy benefits that have
been paid following the appraisal process . . . .”
(Dkt. #58). Consequently, Park Board's claim for breach
of contract, as to the denial of its first request for
appraisal, survived (Dkt. #58). “Park Board's
extra-contractual claims” were deemed moot by the Court
“to the extent they [sought] damages for policy
benefits that State Auto paid following the appraisal
process” (Dkt. #58). The remainder of Park Board's
extra-contractual claims survived. Finally, the Court allowed
Park Board's claims under the Texas Prompt Payment of
Claims Act (“the PCCA”) to survive after finding
that “State Auto's prompt payment of the appraisal
award does not immunize it from being in violation of the
PCCA” (Dkt. #58).
about October 10, 2019, Park Board served Brett Lochridge
“with a subpoena duces tecum to appear at the
undersigned counsel's office on November 13, 2019 . . .
.” (Dkt. #72). “The purpose of Lochridge's
testimony, ” according to Park Board, “is to
determine if the [appraisal] award must be set aside”
(Dkt. #72). On October 23, 2019, Brett Lochridge filed Brett
Lochridge' Motion to Quash or, in the Alternative, Modify
Subpoena (Dkt. #71). Lochridge argues that, because of the
Court's recent Memorandum Opinion and Order (Dkt. #58),
“no claims remain in this action to which Mr. Lochridge
has knowledge and his deposition can only be seen as
harassment” (Dkt. #71). Accordingly, Lochridge requests
that the Court quash the subpoena (Dkt. #71).
alternative, Lochridge argues that the Court should modify
the date and scope of the subpoena (Dkt. #71). As to the
date, Lochridge argues that he has informed Park Board that
he is unavailable for a deposition on November 13 due to
prior travel arrangements. Lochridge accordingly requests
that the Court “modify the subpoena to allow that Mr.
Lochridge  be deposed on a mutually convenient date”
(Dkt. #71). As to the scope of the subpoena, Lochridge first
argues that the Court should modify the subpoena duces
tecum to exclude document requests 3-10 which
“seek materials related to Mr. Lochridge's
performance of his duties as an appraiser” (Dkt. #71).
Lochridge similarly argues that document request 15 should be
excluded because it “asks for documents related to the
basis for the award” (Dkt. #71). Lochridge also opposes
document requests 11-13 which “ask for Mr. Lochridge to
produce all materials regarding his payment for acting as an
appraiser and any other documents relating to work done for
the Defendants” (Dkt. #71). Finally, Lochridge opposes
document request 14 which “asks for every affidavit or
deposition that Mr. Lochrdige has ever given” (Dkt.
#71). This request, Lochridge continues, is
“horrifically overbroad and is not even attempting to
be narrowed to relevant information” (Dkt. #71).
November 15, 2019, Park Board filed Plaintiff's Response
to Brett Lochridge's Motion to Quash or, in the
Alternative, Modify Subpoena (Dkt. #72). Park Board argues
that Lochridge's Motion to Quash is
“groundless” because the purpose of seeking the
deposition of Lochridge is “to determine if the award
must be set aside” (Dkt. #72). As to Lochridge's
opposition to the requested documents, Park Board simply
replies that the “deposition must move forward as set
in the attached subpoena . . . .” (Dkt. #72). The Court
now considers Brett Lochridge's Motion to Quash or, in
the Alternative, Modify Subpoena (Dkt. #71).
to Federal Rule of Civil Procedure 26(b)(1), parties
“may obtain discovery regarding any non[-]privileged
matter that is relevant to any party's claim or defense .
. . .” Fed.R.Civ.P. 26(b)(1). Relevance, for the
purposes of Rule 26(b)(1), is when the request is reasonably
calculated to lead to the discovery of admissible evidence.
Fed.R.Civ.P. 26(b)(1); Crosby v. La. Health & Indem.
Co., 647 F.3d 258, 262 (5th Cir. 2011). Relevant
information includes “any matter that bears on, or that
could reasonably lead to other matter that could bear on, any
issue that is or may be in the case.” Oppenheimer
Fund, Inc. v. Sanders, 437 U.S. 340, 351 (1978). In
other words, “[r]elevancy is broadly construed, and a
request for discovery should be considered relevant if there
is ‘any possibility' that the information sought
may be relevant to the claim or defense of any party.”
S.E.C. v. Brady, 238 F.R.D. 429, 437 (N.D. Tex.
2006) (quoting Merrill v. Waffle House, Inc., 227
F.R.D. 467, 470 (N.D. Tex. 2005)). Consequently,
“[u]nless it is clear that the information sought can
have no possible bearing on the claim or defense of a party,
the request for discovery should be allowed.”
Brady, 238 F.R.D. at 437. The Court has provided
guidance in matters of discovery. The Court's scheduling
order requires that the parties produce, as part of their
initial disclosure, “documents containing, information
‘relevant to the claim or defense of any
party.'” (Dkt. #21 at pp. 3-4). Moreover, the Local
Rules of the Eastern District of Texas provide further
guidance suggesting that information is “relevant to
any party's claim or defense [if]: (1) it includes
information that would not support the disclosing
parties' contentions; . . . (4) it is information that
deserves to be considered in the preparation, evaluation or
trial of a claim or defense. . . .” Local Rule
CV-26(d). It is well established that “control of
discovery is committed to the sound discretion of the trial
court.” Freeman v. United States, 556 F.3d
326, 341 (5th Cir. 2009) (quoting Williamson v. U.S.
Dep't of Agric., 815 F.2d 368, 382 (5th Cir. 1987)).
to Rule 45(d)(3), upon timely motion, “the court for
the district where compliance is required must quash or
modify a subpoena that, ” inter alia, requires
disclosure of privileged or protected matter or subjects a
person to undue burden. Fed.R.Civ.P. 45(d)(3)(A). “The
court must balance the need for discovery by the requesting
party and the relevance of the discovery to the case against
the harm, prejudice, or burden to the other party.”
RYH Properties, LLC v. West, 2011 WL 13196550, at *2
(E.D. Tex. Feb. 3, 2011) (citing Cmedia, LLC v. LifeKey
Healthcare, LLC, 216 F.R.D. 387, 389 (N.D. Tex. 2003)).
When determining whether a subpoena is unduly burdensome, a
court may consider: “(1) relevance of the information
requested, (2) the need of the party for the documents, (3)
the breadth of the document request, (4) the time period
covered by the request, (5) the particularity with which the
party describes the requested documents, and (6) the burden
imposed.” West, 2011 WL 13196550, at *2
(citing Wiwa v. Royal Dutch Petroleum Co., 392 F.3d
812, 818 (5th Cir. 2004); Brady, 238 F.R.D. at 437).
The Court may also consider whether “the subpoena ...