Superior Court of California

County of Los Angeles

Department 50

Marc Savas, et al., Plaintiffs, vs. state farm, et al., Defendants.	Case No.:	21STCV03286
	Hearing Date:	June 11, 2024
	Hearing Time:	10:00 a.m.
	[TENTATIVE] ORDER RE: MOTION BY PLAINTIFFS MARC SAVAS AND ALICIA SAVAS TO REOPEN DISCOVERY FOR LIMITED PURPOSE

Background

This case arises out of an incident that occurred on or about September 5, 2020, where the residential property of Plaintiffs Marc Savas and Alicia Savas sustained significant property damage when a water pipe in their home suddenly and accidentally burst (the “Loss”). Plaintiffs allege that following the Loss, Defendant State Farm General Insurance Company unreasonably delayed the handling, adjustment and resolution of the claim, and has taken unreasonable coverage and claim positions. Plaintiffs filed their complaint against Defendant and Does 1-50 on January 26, 2021. The complaint alleges (1) breach of contract; and (2) breach of the implied covenant of good faith and fair dealing.

Discussion

Plaintiffs move this Court for an order pursuant to Code of Civil Procedure § 2024.050, subd. (b) to reopen discovery for the limited purpose of investigating Defendant’s “Water Loss Initiative” “Water Loss Forum” and its policies, procedures, related documents, and training concerning residential water loss claim handling.

Code of Civil Procedure section 2024.050(b) states in pertinent part: “In exercising its discretion to grant or deny this motion, the court shall take into consideration any matter relevant to the leave requested, including, but not limited to, the following: (1) The necessity and the reasons for the discovery. (2) The diligence or lack of diligence of the party seeking the discovery or the hearing of a discovery motion, and the reasons that the discovery was not completed or that the discovery motion was not heard earlier. (3) Any likelihood that permitting the discovery or hearing the discovery motion will prevent the case from going to trial on the date set, or otherwise interfere with the trial calendar, or result in prejudice to any other party. (4) The length of time that has elapsed between any date previously set, and the date presently set, for the trial of the action.”

Plaintiffs contend that they require the opportunity to perform limited written discovery, third party discovery, and depositions to address these materials and topics. Plaintiffs argue that they will be severely prejudiced because these documents and topics are directly relevant to Plaintiffs’ water loss claim and Defendant’s defenses being asserted in the instant action, and they promptly sought leave to reopen discovery.

In opposition, Defendant argues that the enumerated factors of Code of Civil Procedure Section 2024.050 weigh in favor of keeping discovery closed.

In reply, Plaintiffs argue that the Court should not consider the factual arguments provided by Defendant because they are not supported by evidence or declarations. Moreover, Plaintiffs have acted diligently and had no reason to know Defendant improperly withheld and concealed discoverable documents and information.

The Code of Civil Procedure Section 2024.050 Factors

Factor (1): The necessity and the reasons for the discovery

Here, Plaintiffs proffer the Declaration of counsel Kevin M. Pollack who states that “through communications with counsel handling separate matters against State Farm on similar types of water loss and property damage claims, [he] became aware that State Farm had improperly withheld information and documents in this matter that were well within the scope of discovery propounded by Plaintiffs.” (Pollack Decl. ¶ 4.) Moreover, counsel states that “discovery will establish that State Farm’s water loss initiative, water loss forum, and related policies, procedures, guidelines, and related documents and training materials went into effect as early as 2017 and remained in effect during the pendency of Plaintiffs’ 2020 loss – and indeed remain in effect today; thus, they are well within the scope of responsive documents and information that should have been previously disclosed and produced.” (Pollack Decl. ¶ 21.)

Plaintiffs also provide Dylan Schaffer’s declaration, who has litigated multiple cases, including water loss cases, against Defendant to show that Defendant withholds the Water Loss Skill Review documents. (Schaffer Decl. ¶4, 5, 12, 15 and 17.) Dylan Schaffer opines “that when asked to produce training and guidelines materials relating to water losses, and when asked to produce materials relating to its claims handling policies, procedures, claim manuals, and training materials regarding water losses State Farm customarily withholds at least many hundreds of documents, videos, digital presentations, and other materials that are responsive to such requests …” (Schaffer Decl. ¶ 19.)

Defendant failed to provide any evidence in support of its arguments. Moreover, Defendant’s arguments are conclusory. For instance, Defendant concludes that “[d]iscovery on such documents will add nothing to the claim-specific issues actually involved in this case.” (Opp’n at p. 9.)

The Court finds that the first factor weighs in Plaintiffs’ favor.

Factor (2): The diligence or lack of diligence of the party seeking the discovery or the

hearing of a discovery motion, and the reasons that the discovery was not completed or that the discovery motion was not heard earlier

Plaintiffs submitted Plaintiffs’ Request for Production of Documents, Set One which shows that Plaintiffs requested all documents referring, concerning, and relating to Defendant’s policies and procedures “regarding how first-party property claims for residential water damage were to be INVESTIGATED between January 1, 2019, and the present.” (Pollack Decl. ¶ 5; Ex. 2, RFP No. 37.) Defendant sought a protective order prior to providing the requested documents. (Pollack Decl. ¶ 6.) After meet and confer efforts and executing a protective order on September 15, 2021, Plaintiff’s counsel states that “State Farm’s counsel specifically advised [the] firm that it was producing the withheld responsive information and then produced documents on October 5, 2021.” Defendant did not disclose it was “continuing to withhold responsive documents on the grounds of confidentiality, trade secrets, privacy, or some other privilege (i.e. a privilege log) as required pursuant to the Code of Civil Procedure, or otherwise give Plaintiffs any indication whatsoever that they were withholding information and documents that had been requested, were responsive, were germane and otherwise material.” (Pollack Decl. ¶ 7.) Therefore, Plaintiffs state that they did not know about the water loss initiative, water loss forum, and related policies. Defendant’s arguments that Plaintiff should have asked the State Farm representatives about their training which would have led to the discovery of the water loss initiative, water loss forum, and related policies is unpersuasive.

The Court finds that the second factor weighs in Plaintiffs’ favor.

Factor (3): Any likelihood that permitting the discovery or hearing the discovery motion

will prevent the case from going to trial on the date set, or otherwise interfere with the trial calendar, or result in prejudice to any other party

Here, trial is set for September 11, 2024. Defendant argues that reopening fact discovery this late into the litigation will further delay the case from going to trial. (Opp’n at p.11.) Plaintiff concedes that a trial continuance will be needed if Defendant does not produce the requested documents. (Mot. to Reopen Discovery at p. 7.)

The Court concludes that the third factor weighs in Defendant’s favor.

Factor (4): The length of time that has elapsed between any date previously set, and the

date presently set, for the trial of the action

Trial in this matter was initially set for September 14, 2022. On or about April 22, 2022, the parties agreed to continue the trial date to December 7, 2022, which the Court accepted. On or about October 22, 2022, the parties stipulated to a second trial continuance and the Court continued the trial to August 30, 2023. The parties exchanged pretrial documents in anticipation of the final status conference; however, on August 10, 2023, State Farm’s claims handling expert advised State Farm that he had been hospitalized and due to his health would not be able to meaningfully submit to a deposition prior to trial. As a result, the Court granted a third continuance to October 25, 2023. On September 28, 2023, the parties entered another stipulation to continue the trial given that Plaintiffs’ counsel’s paralegal would not be available to assist with trial preparation. The Court granted the stipulation and continued the trial to the current date of September 11, 2024. Although, it has been approximately seven months since the last trial continuance, and roughly two years since the original trial date in this action, the Court notes that three of the four continuances were stipulated by both parties and one continuance was requested by Defendant. The continuances were not solely requested by Plaintiffs.

The Court finds that this factor weighs in favor of Plaintiffs.

Conclusion

The Court grants Plaintiffs’ motion to reopen discovery for the limited purpose of investigating Defendant’s “Water Loss Initiative” “Water Loss Forum” and its policies, procedures, related documents and training concerning residential water loss claim handling.

Plaintiffs are ordered to provide notice of this ruling.

DATED: June 11, 2024

________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court