SEATTLE (LN) — A U.S. District Court in Washington ordered National Fire & Marine Insurance Company to produce its entire, unredacted claim file to counterclaim plaintiff Donald Stallings, ruling the insurer failed to meet its burden of proving attorney-client privilege or work-product protection over the documents.
The order, filed May 18, resolves a discovery dispute in National Fire & Marine Insurance Company v. Nightingale Healthcare LLC, case No. 2:25-cv-00751.
Stallings, a defendant in the underlying action, moved to compel production of the insurer’s claim file and related emails under Federal Rule of Civil Procedure 37(a), arguing the materials were essential to his bad-faith counterclaim.
National Fire & Marine Insurance Company, also known as MedPro, resisted, asserting that the redacted portions of the file were protected by both attorney-client privilege and the work-product doctrine.
The court applied the standard set in Cedell v. Farmers Ins. Co. of Washington, which presumes no attorney-client privilege exists between an insurer and insured during the claims-adjusting process.
To overcome this presumption, the insurer must show its attorneys were not engaged in quasi-fiduciary tasks like investigating or evaluating the claim, but were instead providing legal counsel on the insurer’s own potential liability.
The court found National Fire & Marine Insurance Company provided no evidence that its attorneys were detached from the claims-adjusting process.
The court rejected the insurer’s “conclusory statement” that its attorneys were not involved in claim adjustment, noting the assertion was unsupported and undermined by Stallings’ descriptions of the attorneys’ activities.
Because the insurer failed to make the required showing under Cedell, the court declined to conduct an in camera review and ruled the attorney-client privilege did not apply.
On the work-product claim, the court found Stallings had established both elements needed to unlock discovery: the insurers’ mental impressions were at issue in the bad-faith claim, and Stallings demonstrated a compelling need for the materials.
The court noted that access to an insurer’s claim file is “crucial in a bad-faith case” and that the redacted portions could not be obtained through other means.
The court concluded that even if the withheld materials constituted work product, Stallings was entitled to their production because the insurers’ strategy and opinions concerning claim handling were directly implicated.
The order grants Stallings’ motion to compel, requiring National Fire & Marine Insurance Company to produce the entire claim file and related emails without redactions.