St. Paul also filed a motion to compel more responsive interrogatory answers from R&Q concerning whether R&Q suffered prejudice as a result of St. Paul’s allegedly dilatory notice. The court denied the request because R&Q had addressed the issue in its memorandum of law in response to St. Paul’s motion for a protective order. The court also rejected St. Paul’s assertion that R&Q’s production of 135 documents was insufficient given St. Paul’s production of nearly two hundred thousand pages, observing that R&Q would naturally have fewer documents given the timing of the notice to the reinsurer. As a side note, a reinsurer would typically have less information than the cedant regarding claims information.
The R&Q decision once again underscores the discovery issues that arise in the context of reinsurance disputes. Courts will continue to balance the needs of the parties to exchange documents and information with the need to protect proprietary information. Although protective orders are a useful tool to safeguard proprietary information, parties should be aware that if the information is potentially relevant to the dispute, it may well be subject to disclosure. Also, unlike disputes between the insurer and a policyholder regarding reinsurance discovery, reinsurance agreements between the parties address the cedant’s duty to keep the reinsurer informed. At issue in this case was the scope of that duty, and the court concluded that the information beneath the ‘rock’ was discoverable.
For more information on the matters discussed in this Locke Lord QuickStudy, please contact the authors.