A federal magistrate judge in the Eastern District of Washington ordered Safeco Insurance Company of America to produce reserve information in a lawsuit filed by Daniel and Colleen Hendricks, ruling the data could lead to admissible evidence about the insurer’s decision-making process. The same order shielded Safeco’s internal claims manuals from public disclosure.
The May 19, 2026, order resolves a discovery dispute in which Safeco sought to withhold reserve data and other claims information while demanding confidentiality protections for its internal claims manuals.
Safeco argued that reserve information was irrelevant because it denied coverage based on policy interpretation rather than valuation. The insurer cited a Western District of Washington ruling indicating that loss reserves likely have no relevance in such contexts.
The Hendrickses countered that reserve information could reveal inconsistencies between Safeco’s internal assessment and its denial. They suggested that reserves set or adjusted after an inspection might demonstrate whether the insurer conducted a meaningful evaluation before issuing the denial.
Magistrate Judge Alexander C. Ekstrom rejected Safeco’s relevance argument, finding that the reserve information had a "possibility of leading to admissible evidence in this case."
Ekstrom ruled that an in camera review was unnecessary and ordered Safeco to disclose the reserve information to the plaintiffs within five days of the order.
On the issue of claims manuals, Safeco agreed to produce them but sought a protective order, arguing they constituted protected trade secrets under Washington state precedent.
The judge distinguished prior state cases, finding that Safeco had made a sufficient showing that the manuals consisted of customized procedures developed over many years at great expense. Ekstrom noted that public disclosure could put the insurer at a competitive disadvantage.
The magistrate judge concluded that redaction was not feasible in this "mine run discovery dispute" and ordered the manuals produced subject to a protective order.
Safeco also sought to block discovery into other claims and actions, arguing the request was overbroad and would require at least 100 hours of review time.
Plaintiffs’ counsel did not provide briefing on this issue and indicated at the hearing he was willing to concede the point. Ekstrom agreed the request was overbroad and declined to compel the discovery.
The order follows a court-ordered meet and confer conference where the parties apparently reached agreement on 60 of 64 topics.