:: Discovery Of Claims Administrator’s Personnel Records Permitted On Question Of Bias

Based on Glenn and Abatie, therefore, it is within the discretion of the district court to permit limited discovery in an ERISA case. Any discovery, however, “must be narrowly tailored and cannot be a fishing expedition.” Groom v. Standard Ins. Co, 492 F. Supp. 2d 1202, 1205 (C.D. Cal. 2007).

Sullivan v. Deutsche Bank Ams. Holding Corp., 2010 U.S. Dist. LEXIS 8414 (S.D. Cal. Feb. 2, 2010)

Sullivan v. Deutsche Bank offers support for limited discovery where the objective is limited to issues pertinent to conflict of interest.   The plaintiff sought performance reviews of the insurance carrier’s employees involved in evaluation of the claim in dispute, namely:

the “performance evaluations or performance reviews for each of [Unum’s] employees [who were involved in the evaluation of Plaintiff’s claim] . . . for the years 2005, 2006, and 2007.”

Rationale

The plaintiff based its case for discovery on a tightly constructed argument:

  1. discovery of the performance evaluations is necessary to determine the credibility of the evaluators involved in denying Plaintiff’s claim.
  2. if Unum awarded superior evaluations for higher rates of denying benefits, this would constitute evidence of a conflict of interest in the administration of claims.
  3. the scope of this discovery is reasonably limited: “Plaintiff is not seeking defendant’s employees personnel files, but merely the performance evaluations over a three year period during which plaintiff’s claim was handled.”

UNUM demurred, citing two objections that essentially cohere into one – the request was overbroad and beyond permitted discovery in an ERISA case – and a third, based upon privacy concerns.

Survey Of Opinions

The Court began with a broad consideration of the judicial landscape, stating that:

. . . district courts have reached different conclusions.

At the far end of the spectrum, the Eastern District of Kentucky summarily denied production of “performance reviews and personnel files” because “those requests are unduly burdensome and their intrusiveness outweighs any likely benefit.” Pemberton v. Reliance Std. Life Ins. Co., 2009 WL 89696 at *3 (E.D. Ky. Jan. 13, 2009).

Other courts have taken a more moderate stance, holding that access to the personnel files is unwarranted, but at the same time ordering production of “documents about employee compensation criteria or standards . . . for employees involved in that claim.” Hughes v. CUNA Mut. Grp., 257 F.R.D. 176, 180-81 (S.D. Ind. 2009); see also, e.g., Santos v. Quebecor World Long Term Disability Plan, 254 F.R.D. 643, 650 (E.D. Cal. 2009); Myers v. Prudential Ins. Co. of Am., 581 F. Supp. 2d 904, 914 (E.D. Tenn. 2008).

Ruling For Plaintiff

Nonetheless, the narrow construction of the Plaintiff’s argument carried the day on the issue.  The Court observes that:

Plaintiff does not request a blanket production of personnel files, however.  Instead, Plaintiff seeks the performance evaluations of 11 individuals–each involved in the evaluation of Plaintiff’s claim for LTD benefits–for a period of three  years.

.  .  .

the evaluators’ performance evaluations are closely related to the issue of conflict of interest.   Accordingly, Plaintiff’s request for the performance evaluations is reasonably calculated to lead to the discovery of admissible evidence. Fed. R. Civ. P. 26(b)(1).   Furthermore, Plaintiff’s request for production is narrowly tailored to the time and scope of Plaintiff’s particular claim for benefits.

Based thereon, the Court GRANTS Plaintiff’s motion to compel production of the performance evaluations [Doc. 21], as identified by Plaintiff’s Request for Production No. 4. Defendant shall produce the performance evaluations on or before February 22, 2010.

Note: The Court cited Knopp v. Life Ins. Co. of N. Am., 2009 WL 5215395 at *4 (N.D. Cal. Dec. 28, 2009) in support of its decision, stating:

Addressing a similar issue, the Northern District of California ordered production of the evaluations, noting:

“This discovery request asks for performance evaluations for the medical consultants or companies.  This information is closely related to the issue of conflict of interest. For instance, if the medical consultants or companies were rewarded by Defendants for providing opinions adverse to a claimant, that would significantly affect the credibility of their evaluations.”

The Court found that discovery was even more appropriate in the case at bar in light of Glenn:

Whereas the standard of review in Knopp was de novo, the Court in the present case reviews UNUM’s denial of Plaintiff’s LTD benefits for an abuse of discretion.   Thus, limited discovery is even more appropriate. Under the abuse of discretion standard, the potential bias of an evaluator–and in turn the potential conflict of interest inherent in the administration of the benefits claim–is a necessary factor in the Court’s analysis. Glenn, 128 S.Ct. at 2350 (holding, in an ERISA case, “that a conflict [of interest] should be weighed as a factor in determining whether there is an abuse of discretion”)(internal  quotations omitted).

Ninth Circuit Authority – The Court framed its analysis within the larger perspective of the Ninth Circuit’s opinion in Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955, 970 (9th Cir. 2006):

in the Ninth Circuit, “when a court must decide how much weight to give a conflict of interest under the abuse of discretion standard, . . . the court may consider evidence outside the [administrative] record.” Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955, 970 (9th Cir. 2006). Based on Glenn and Abatie, therefore, it is within the discretion of the district court to permit limited discovery in an ERISA case. Any discovery, however, “must be narrowly tailored and cannot be a fishing expedition.” Groom v. Standard Ins. Co, 492 F. Supp. 2d 1202, 1205 (C.D. Cal. 2007)