An Insurance Company Must Respond To A Subpoena Involving Ongoing Third-Party Litigation.

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With escalating frequency, we at Mills & Associates are seeing aggressive plaintiffs serve subpoenas directly on the defendant’s insurance carriers.  These subpoenas often request records that the retained defense attorney has already produced.  Sometimes they will request a particular claims adjuster appear and testify about those records.  By doing so, plaintiffs are hoping to identify documents or information that the retained defense attorney has improperly withheld.  We thought our readers might benefit from some lessons we have learned in guiding insurance companies through the process of responding to these types of subpoenas. 

Like any other business or individual, an insurance company can be the target of a subpoena.  It is
becoming more common for a plaintiff to subpoena records directly from the company that insures the defendant that that particular plaintiff is suing.  In hotly contested cases, these subpoenas can be very intrusive, time consuming and often the information requested in the subpoena is protected from
disclosure.  Plaintiffs may also serve subpoenas on specific insurance adjusters.  The insurance company must properly and timely respond to the subpoena or it faces the risk of sanctions from the court.  Even worse, without a proper response, the company may be obligated to produce records that otherwise would have been protected.

How then should an insurance company respond if it is served with a subpoena asking for objectionable material relating to an ongoing third-party case?  Let’s take a quick overview.

The Retained Defense Attorney Should Not Be The One To Challenge The Subpoena.

Since the retained defense attorney knows the case, the insurance carrier may be initially inclined to have that attorney respond to the subpoena to the insurance company.  However, that response would be ill-advised.  While it is true that there is an attorney/client relationship between the retained defense attorney and the insurance company, that attorney is not in the best position to challenge the subpoena.  In addition to owing a duty to the insurance company, the retained defense attorney also owes a duty to protect the insured.  That tripartite relationship creates a conflict to both clients.  To be best served, the carrier should hire separate counsel to challenge the subpoena.  It goes without saying that the counsel responding to the subpoena and the retained defense attorney need to be in close contact with one another to insure that they give adequate consideration to all issues that might arise during the process.

Does The Subponea Require The Production Of Records Only Or Does It Require An Appearance At A Deposition?

Subpoenas can require one of two responses.  Some subpoenas require the production of records only.  Others require both an appearance and the production of records.  The appropriate response to the subpoena will depend on the category into which the subpoena falls.

Objections To A Records Only Subpoena

When the subpoena requests that the company produce records but does not seek an appearance, the company may be able to avoid certain obligations by sending the plaintiff’s attorney a letter detailing the carrier’s objections to the specific requests.   See FRCP 45(c)(2)(A) and NRCP(c)(2)(A).  This may sound simple enough.  However, legal requirements dictate the content, timing and construction of this letter.  If properly executed and conveyed, this letter may relieve the carrier of the obligation to respond to certain requests unless the court issues an order directing the carrier to do otherwise.  Essentially, the letter places the ball back in the plaintiff’s court regarding the objectionable records and requires the plaintiff to take the next step before the matter moves forward.  This letter alone may be enough to deter further action.  If on the other hand, the plaintiff’s attorney persists, or if the subpoena requires an appearance along with the records, a Motion to Quash may be necessary.

Motion To Quash

Where an appearance is required, the insurance company has the right to file Motion to Quash plaintiff’s subpoena.  Though slightly more intricate than the objection letter described above, the Motion to Quash is relatively simple and experienced counsel can guide the company or its adjuster through the process with ease.  See FRCP 45(c)(3) or NRCP 45(c)(3).  At the hearing on the Motion to Quash, the court will consider whether service was proper, the documents are privileged, the requests are over burdensome or a myriad of other potential issues.  If your company or an adjuster at the company receives a subpoena, we cannot emphasize enough that you contact an experienced insurance coverage attorney immediately.  At Mills & Associates, we are specifically trained to spot nuances that dictate the company’s options and provide it the best possible legal protection.

Mills & Associates is adept in deciphering and disarming Plaintiff’s subpoenas.  If you or your company have been served, please feel free to contact us to discuss any questions you might have.  This ounce of prevention may be worth a policy-limit of cure.