Download PDF - Goodmans

allege and prove the grounds justifying that relief, the trial court exceeds its
discretion by granting the motion.2007 WL 4554466 at 7 (citing Fed. R. Civ. P.
60(b)(6) (2007)).
O’Neal v. Oxendine, 237 Ga. App. 171, 514 S.E.2d 908 (1999). The receiver of
an insolvent health maintenance organization sought approval of a plan of
rehabilitation under which solvent health maintenance organization would
assume all policies and policyholder liabilities in exchange for transfer of
most of insolvent health maintenance organization’s assets. A judgment
holder moved to intervene and moved for discovery. The trial court denied
both motions, citing the urgency of the proposed transaction. The appellate
court affirmed, holding that the allowance of discovery in rehabilitation
proceedings is discretionary and that the denial of discovery in this case was
not an abuse of discretion. The Court also found that the judgment holder
was not harmed by the denial of intervention, because he was allowed to
participate fully in the hearing on the plan.
Illinois In re American Reserve Corp., 1990 U.S. Dist. LEXIS 15762 (N.D. Ill. Dec. 5, 1990).
The trustee in bankruptcy of the holding company of an insolvent insurer sued
the insurer's public accountants for fraud, breach of contract, civil conspiracy,
and RICO violations, and sued certain former officers and directors of insurer for
RICO violations, fraud, and negligence. The Illinois Liquidator of the insolvent
insurer brought similar claims against one of the accounting firms and other
defendants. The trustee sought to consolidate discovery in the trustee's actions
with the Liquidator's actions. The court ruled that the cases were incompatible
for discovery consolidation. The legal theories in the cases were incompatible,
as the trustee charged the defendants who were directors and officers with
negligence and breach of fiduciary duty, and charged the accounting firms with
concealing the insurer's impaired financial condition from the directors. The
Liquidator's cases proceeded on the theory that insurer's officers and directors
conspired with the accountants to conceal the insurer's insolvency from state
insurance regulators. The court also refused to modify a protective order that
the magistrate issued to preserve the accountant privilege. The privilege
belongs to the accountant and may be applied against a client, and the privilege
was correctly asserted and not waived.
In re American Reserve Corp., 1991 U.S. Dist. LEXIS 5425 (N.D. Ill. April 24,
1991). The trustee in bankruptcy for an insurance holding company planned
on using experts at trial, but did not disclose who the experts were to the
defendant. The magistrate judge granted the defendant's motion for
sanctions, and barred the trustee from using any experts. The court held
that discovery sanctions are dispositive pre‐trial matters subject to de novo
review. The court ruled that sanctions were not warranted, as the trustee
did not totally fail to respond to defendant's interrogatories. In cases where
such a total failure is lacking, the magistrate may impose sanctions only if a
party disobeys a court order compelling discovery.
Safety‐Kleen Corp. v. Canadian Universal Ins. Co., 258 Ill. App. 3d 298, 631
N.E.2d 475 (Ill. App. Ct. 1994). The receiver of a Canadian company, with
assets in Rhode Island, sought to vacate a $1 million default judgment
entered against defendant six months prior to the receiver's appointment.
The court found reasonable excuse for the corporation's delay in
responding: Canadian law prohibited participation in litigation without the
supreme court's permission; its previous counsel withdrew representation
without notification, thus prejudicing the defendant from responding timely;
and the receiver responded within six months of taking responsibility for the