Discovery order too broad in Mostyn Law hail cases, Texas SC finds

By David Yates | Oct 31, 2016

AUSTIN – National Lloyds will no longer have to fork over its internal management reports to The Mostyn Law Firm, with the Texas Supreme Court recently finding the information being sought by dozens of hail suit plaintiffs was “overbroad.”

In the spring of 2012, two hailstorms rocked Hidalgo County, giving rise to thousands of lawsuits against insurance companies. A multidistrict litigation court was created to preside over the mass litigation.

Last June, National Lloyds petitioned the high court for a writ of mandamus, arguing a lower court abused its discretion by ordering the company to produce the management reports, which included “all emails, reports attached to emails, and any follow-up correspondence and information,” and for imposing the subsequent sanctions that followed when the insurer refused to comply with the order.

On Oct. 28, justices held the “that the production order is overbroad,” and conditionally granted mandamus relief, directing the pretrial court to vacate the discovery order and reevaluate the ordered sanctions.

The writ will issue only if the lower court fails to do so.

On appeal, National Lloyds argued the reports were not relevant to an individual insured’s claim for underpayment.

“In the past few years, the same set of plaintiffs’ firms (Steve Mostyn of Mostyn Law and Gilberto Hinojosa) have filed tens of thousands of hail and windstorm suits alleging bad faith insurance practices by property insurers such as National Lloyds,” the insurer’s brief states.

“In almost every suit, the plaintiff seeks ‘institutional’ discovery of the carrier, including all files involving prior claims made in the same area or involving the same storm.

“In some MDL courts, like Respondent in Hidalgo County, plaintiffs’ practice of seeking irrelevant claim files is even more burdensome and the docket turns into an effort to exhaust the resources of the defendants, rather than to ascertain information that would be relevant and admissible in any individual plaintiff’s case.”

National Lloyds is represented in part by Scot Doyen of the Houston firm Doyen Sebesta.

Case No. 15-0452

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