Petition for Writ of Mandamus - Supreme Court of Texas

NO. ________________ 

FILED 

IN THE SUPREME COURT 

OF TEXAS 

11 November 14 P3:40 

BLAKE. A. HAWTHORNE 

CLERK 

IN THE SUPREME COURT OF TEXAS 

In re LEXINGTON INSURANCE COMPANY 

Relator 

From the 133 rd Judicial District Court of Harris County, Texas 

Cause No. 2009-22372 

The Honorable Jaclanel McFarland, presiding 

PETITION FOR WRIT OF MANDAMUS 

Robert I. Siegel 

State Bar No. 24054171 

rsiegel@glllaw.com 

Charlotte A. Fields 


cfields@glllaw.com 

Connie L. Hawkins 


chawkins@glllaw.com 

GIEGER, LABORDE & LAPEROUSE, L.L.C. 

1177 West Loop South, Suite 750 

Houston, Texas 77027 

Telephone: (832) 255-6000 

Facsimile: (832) 255-6001 

Thomas C. Wright 


wright@wrightclose.com 

Michael Choyke 


choyke@wrightclose.com 

Jessica Zavadil 


zavadil@wrightclose.com 

Wright & Close, L.L.P. 

Three Riverway, Suite 600 


(713) 572-4321Telephone 

(713) 572-4320 Facsimile 

COUNSEL FOR RELATOR, 

LEXINGTON INSURANCE COMPANY 

EMERGENCY RELIEF REQUESTED 

RELATOR REQUESTS ORAL ARGUMENT

IDENTITY OF PARTIES AND COUNSEL 

Relator: 

Lexington Insurance Company 

Counsel for Relator: 







Gieger, Laborde & Laperouse, L.L.C. 



(832) 255-6000 Telephone 

(832) 255-6001 Facsimile 










(713) 572-4321Telephone 

(713) 572-4320 Facsimile 

Respondent: 

Hon. Jaclanel McFarland 

133 rd Judicial District Court 

Harris County Civil Courthouse 

201 Caroline, 11 th Floor 


ii

Real Parties in Interest: 

JAW The Lake, L.L.C. 

JAW Timberwalk, L.L.C. 

JAW Scarsdale Park, L.L.C. 

JAW Boardwalk of Baytown, L.L.C. 

JAW Chateau Creole, L.L.C. 

Counsel for Real Parties in Interest: 

James L. Cornell 


jcornell@cornell-pardue.com 

Cornell & Pardue 

2727 Allen Parkway, Suite 1675 


(713) 526-0500 Telephone 

(713) 526-7974 Facsimile 

Marc E. Gravely 


mgravely@gplawfirm.com 

Matthew R. Pearson 


mpearson@gplawfirm.com 

Gravely & Pearson, L.L.P. 

425 Soledad, Suite 600 

San Antonio, Texas 78205 

(210) 472-1111 Telephone 

(210) 472-1110 Facsimile 

Brendan K. McBride 


brendan.mcbride@att.net 

McBride Law Firm 

Of Counsel to Gravely & Pearson, L.L.P. 



(210) 227-1200 Telephone 

(210) 881-6752 Facsimile 

iii

TABLE OF CONTENTS 

IDENTITY OF PARTIES AND COUNSEL ...................................................................... ii 

TABLE OF CONTENTS ................................................................................................... iv 

TABLE OF AUTHORITIES ............................................................................................... v 

STATEMENT OF THE CASE ........................................................................................ viii 

STATEMENT OF JURISDICTION .................................................................................. ix 

ISSUES PRESENTED ........................................................................................................ x 

STATEMENT OF FACTS .................................................................................................. 1 

SUMMARY OF ARGUMENT ........................................................................................... 5 

ARGUMENT ....................................................................................................................... 6 

I. THE TRIAL COURT CLEARLY ABUSED ITS DISCRETION BY 

ORDERING PRODUCTION OF IRRELEVANT DOCUMENTS 

IN RESPONSE TO OVERBROAD REQUESTS ................................................... 6 

II. 

III. 

THE TRIAL COURT CLEARLY ABUSED ITS DISCRETION BY 

ORDERING PRODUCTION IN LIGHT OF 

UNCONTROVERTED EVIDENCE OF UNDUE BURDEN .............................. 10 


DENYING PROTECTION AFTER UNCONTROVERTED 

EVIDENCE OF PRIVILEGE ................................................................................ 12 

IV. LEXINGTON HAS NO ADEQUATE REMEDY ON APPEAL ......................... 14 

PRAYER ........................................................................................................................... 16 

VERIFICATION ............................................................................................................... 18 

CERTIFICATION ............................................................................................................. 19 

CERTIFICATE OF SERVICE .......................................................................................... 20 

INDEX TO APPENDIX .................................................................................................... 21 

iv

TABLE OF AUTHORITIES 

Cases 

Alpha Life Ins. Co. v. Gayle, 

796 S.W.2d 834 (Tex. App.—Houston [14 th Dist.] 1990, orig. proceeding) ................ 14 

Bennett v. Reynolds, 

315 S.W.3d 867 (Tex. 2010) ........................................................................................... 7 

Fethkenher v. Kroger Co., 

139 S.W.3d 24 (Tex. App.—Fort Worth 2004, no pet.) ............................................... 11 

Horizon/CMS Healthcare Corp. v. Auld, 

34 S.W.3d 887 (Tex. 2000) ........................................................................................... 10 

Humphreys v. Caldwell, 

888 S.W.2d 469 (Tex. 1994) (orig. proceeding) ........................................................... 14 

In re AIU Ins. Co., 


In re Alford Chevrolet-Geo, 


In re Allstate County Mut. Ins. Co., 

227 S.W.3d 667 (Tex. 2007) (orig. proceeding) ......................................................... 7, 8 

In re CSX Corp., 

124 S.W.3d 149 (Tex. 2003) (orig. proceeding) ....................................................... 6, 15 

In re E.I. DuPont de Nemours and Co., 


In re GMAC Direct Ins. Co., 

No. 09-10-00493-CV, 2010 WL 5550672 (Tex. App.--Beaumont 2010, orig. 

proceeding) ...................................................................................................................... 8 

In re Graco Children’s Products, Inc., 


v

In re Harco Nat’l Ins. Co., 

No. 2-09-351-CV, 2010 WL 2555629 (Tex. App.—Fort Worth 2010, orig. proceeding) 

....................................................................................................................................... 13 

In re Harris, 

315 S.W.3d 685 (Tex. App.—Houston [1 st Dist.] 2010, orig. proceeding) .................. 15 

In re Hochheim Prairie Farm Mutual Insurance Association, 

296 S.W.3d 907 (Tex. App.—Corpus Christi-Edinburg 2009, orig. proceeding) .......... 9 

In re Jacobs, 

300 S.W.3d 35 (Tex. App.—Houston [14 th Dist.] 2009, orig. proceeding) .................... 6 

In re John Crane, Inc., 

No. 01-03-00698-CV, 2003 WL 22682613 (Tex. App.—Houston [1 st Dist.] 2003, orig. 

proceeding) .................................................................................................................... 12 

In re McAllen Med. Ctr., Inc., 

275 S.W.3d 458 (Tex. 2008) ......................................................................................... 14 

In re Mobil Oil Corp., 

No. 09-06-392-CV, 2006 WL 3028063 (Tex. App.—Beaumont 2006, orig. 

proceeding) .................................................................................................................... 10 

In re Prudential Ins. Co. of Am., 


In re SCI Texas Funeral Serv., Inc., 

236 S.W.3d 759 (Tex. 2007) (orig. proceeding) ............................................................. 7 

In re Sears, Roebuck & Co., 

123 S.W.3d 573 (Tex. App.—Houston [14 th Dist.] 2003, orig. proceeding) .......... 12, 15 

In re Steadfast Ins. Co., 

No. 01-09-00235-CV, 2009 WL 1424634 (Tex. App.—Houston [1 st Dist.] 2009, orig. 

proceeding) .................................................................................................................... 11 

In re Team Rocket, L.P., 


In re U.S.A.A., 

76 S.W.3d 112 (Tex. App.—San Antonio 2002, orig. proceeding) .............................. 14 

vi

In re Union Pacific Resources Co., 

22 S.W.3d 338 (Tex. 1999) (orig. proceeding) ............................................................. 12 

Lunsford v. Morris, 

746 S.W.2d 471 Tex. 1992) (orig. proceeding) ............................................................... 6 

Phillip Morris U.S.A. v. Williams, 

549 U.S. 346 (2007) .................................................................................................... 7, 8 

Pittsburgh Corning Corp. v. Caldwell, 


Texaco, Inc. v. Sanderson, 


Texas Tech Univ. Health Sci. Ctr. v. Apodaca, 

876 S.W.2d 402 (Tex. App.—El Paso 1994, writ denied) ............................................ 13 

Walker v. Packer, 


Statutes 

TEX. GOV’T CODE § 22.002 ................................................................................................ ix 

Rules 

TEX. R. CIV. P. 192.3(a) ....................................................................................................... 6 

TEX. R. CIV. P. 192.4(b) ............................................................................................ 10, 12 

TEX. R. CIV. P. 192.5 ....................................................................................................... 12 

TEX. R. CIV. P. 193.4(a) .................................................................................................. 12 

TEX. R. EVID. 401 ................................................................................................................ 6 

TEX. R. EVID. 503 .............................................................................................................. 12 

vii

STATEMENT OF THE CASE 

Nature of underlying case: 

Respondent: 

Respondent’s action: 

Court of appeals: 

Claims for contractual and extra-contractual damages 

arising from Plaintiffs’ Hurricane Ike claims under an 

insurance policy issued by Lexington. (R. 8) 1 



Harris County, Texas 

August 16, 2011, Order Granting In Part Defendant’s 

Motion to Reconsider Order Plaintiffs’ Expedited 

Motion to Compel Discovery. (R. 27; App. 1) 2 

Denied mandamus relief via memorandum opinion 

issued on October 27, 2011, in which no reason for the 

denial was given. (R. 28; App. 2) 

1 References to the tabbed and numbered documents in the mandamus record will be cited as “R. ___.” 

2 References to the tabbed and numbered documents in the mandamus appendix will be cited as “App. 

___.” 

viii

STATEMENT OF JURISDICTION 

This Court may properly exercise jurisdiction over this original proceeding 

pursuant to TEX. GOV’T CODE § 22.002, which gives this Court writ power. 

ix

ISSUES PRESENTED 

1. Did the trial court clearly abuse its discretion by ordering Lexington to 

produce patently irrelevant documents relating to insurance claims beyond 

those at issue in the underlying case? 

2. Did the trial court clearly abuse its discretion by ordering production of 

documents in light of Lexington’s uncontroverted evidence as to undue 

burden? 

3. Did the trial court clearly abuse its discretion by denying protection after 

Lexington produced uncontroverted evidence that the documents sought are 

privileged? 

4. Does Lexington have an adequate remedy on appeal? 

x

STATEMENT OF FACTS 

Lexington Insurance Company issued a commercial property policy, No. 3258064, 

to Nations Asset Management, L.P. (CAT) (“NAM”) with coverage dates of March 31, 

2008, to April 1, 2009 (the “Primary Policy”). (R. 3A) NAM was formed for the sole 

purpose of purchasing commercial property insurance from Lexington, as well as various 

excess carriers. (R. 2A at 3) Plaintiffs in the underlying lawsuit 3 own five apartment 

complexes that are among the approximately 300 different commercial properties in six 

states that were insured under the Primary Policy. (R. 3B at 5) Coverage under the 

Primary Policy for any one occurrence, regardless of the number of locations making 

claims, was limited to $25 million. (R. 3A) 

Plaintiffs and at least 139 other entities asserted claims under the Primary Policy 

for damages allegedly caused to their properties by Hurricane Ike in September 2008. (R. 

8 and 19) Lexington made payments totaling $25 million—the limit of the Primary 

Policy. (R. 3F, Ex. 1) It is undisputed that the $25 million limit of the Primary Policy was 

exhausted by these payments on January 8, 2010. (R. 2A at 2 n.2) 

Plaintiffs filed five separate lawsuits complaining of Lexington’s handling of 

Hurricane Ike claims, which were ultimately consolidated in the 133rd District Court of 

Harris County. (R. 12) Plaintiffs seek declaratory relief as to coverage for their properties 

under the Primary Policy, as well as damages for breach of contract, violations of the 

Insurance Code and the Texas DTPA, and common-law bad faith. (R. 8, 19) 

3 Plaintiffs (and Real Parties in Interest) are JAW The Lake, L.L.C.; JAW Timberwalk, L.L.C.; JAW 

Scarsdale Park, L.L.C.; JAW Boardwalk of Baytown, L.L.C.; and JAW Chateau Creole, L.L.C. 

1

Plaintiffs propounded Requests for Production, to which Lexington timely 

responded. (R. 1A, 3F, 10) Only two of Plaintiffs’ requests are potentially relevant to this 

proceeding. Request for Production No. 20 asks for “[t]he complete claims file for all 

claims filed under NAM 20088064-01.” (R. 3F at 9) However, Lexington did not issue 

any policy bearing that number. (R. 1A at 16) Accordingly, there are no documents 

responsive to this request. Request for Production No. 37 states: “Produce all claims files 

for all claimants listed on the attached Exhibit 1.” (R. 3F at 11) Exhibit 1 to Plaintiffs’ 

Requests for Production is a four-page chart showing 154 payments made by Lexington 

under the Primary Policy to 75 different claimants for Hurricane Ike claims (the 

“Payment Chart”). (R. 3F, Ex. 1) Those payments totaled $25 million. (Id.) By its plain 

language, Request No. 37 does not seek production of claims files other than those 

entities identified on the Payment Chart. 

Lexington objected to both requests because, among other things, the requests are 

overbroad; the requests seek irrelevant documents; the requests “would impose an 

unreasonable burden in time and expense”; the requests constitute “an impermissible 

‘fishing expedition’”; the requests would require the production of documents exempt 

from discovery under the attorney-client, work product, or joint defense privilege; and the 

requests seek production of confidential, proprietary documents related to other insureds, 

potentially in violation of Lexington’s duties to those insureds. (R. 1A at 16-17, 27) 

Plaintiffs filed an “Expedited Motion to Compel Discovery” on May 2, 2011. In 

their motion, Plaintiffs asked for “production of the other claim files under the NAM 

policy.” (R. 1) Lexington responded by arguing: (1) the documents sought are irrelevant 

2

and beyond the scope of proper discovery; (2) the requests are overbroad as a matter of 

law; and (3) the requested documents necessarily include privileged and confidential 

information. (R. 2) Lexington also moved for entry of a protective order. (Id.) 

Following a hearing on June 13, 2011, the trial court signed an order granting 

Plaintiffs’ motion “in all particulars” and ordering Lexington to comply within 60 days, 

or by August 12, 2011. (R. 3D) Lexington filed a Motion to Reconsider. (R. 3, 5) In 

addition to re-urging its earlier arguments, Lexington argued that production would be 

unduly burdensome, and submitted an affidavit detailing the time and expense it would 

require for Lexington to review and produce the requested claims files. (R. 5E) The 

affidavit also confirmed that the requested files contain information protected by 

attorney-client and work-product privileges as well as confidential third-party 

information. (Id.) Plaintiffs did not object to this affidavit, aside from one sentence in 

their response asserting generally that the affidavit is conclusory. (R. 7 at 2). 

When the trial court failed to rule on Lexington’s motion to reconsider by August 

10, 2011, Lexington filed a petition for writ of mandamus in the court of appeals. (R. 20) 

At Lexington’s request, the appellate court stayed the June 13 order until the trial court 

ruled on Lexington’s motion to reconsider and abated the mandamus proceeding pending 

the trial court’s ruling. (R. 21, 22) 

On August 16, 2011, Plaintiffs’ counsel sent a letter to the trial judge advising her 

of the appellate court’s actions. (R. 13) Plaintiffs’ counsel further stated that, to 

“accommodate the concerns of Lexington,” Plaintiffs would agree to limit their document 

requests so that Lexington would not have to produce “at this time” portions of the claims 

3

files consisting of certain computer-generated estimates. (Id.) Plaintiffs’ counsel provided 

the court with a proposed order “which reflects this compromise.” (Id.) However, 

Plaintiffs never communicated this proposed “compromise” to Lexington. Although the 

August 16 letter indicates that a copy was sent to Lexington’s counsel, Lexington did not 

receive a copy until 9:37 PM that evening. (R. 13, 14) By then, however, it was too late— 

the trial court had already signed Plaintiffs’ proposed order without alteration. (App. 1) 

The trial court’s August 16 order provides as follows: 

(App. 1) By expressly “consider[ing]” Lexington’s motion to reconsider, vacating its 

prior order, and purporting to grant Lexington’s motion, the trial court presumptively 

considered Lexington’s arguments and the evidence Lexington presented. However, the 

August 16 order did not address any of Lexington’s substantive objections, but rather 

merely carved out from production “at this time” Lexington’s computer-generated loss 

estimates for each claim. (Id.) The order also required Lexington to produce the 

documents by September 12, 2011. (Id.) 

4

On September 9, 2011, Lexington sought mandamus relief from the August 16 

order and requested a stay. (R. 24, 25) The court of appeals granted the stay and 

instructed Plaintiffs to file a response. (R. 26) The appellate court denied the mandamus 

petition in a memorandum opinion on October 27, 2011, without giving the reasons for 

its denial. (App. 2) 

Plaintiffs filed a Motion for Sanctions and to Compel Documents on November 10 

and set it for hearing on Tuesday, November 15, at 10:00 AM. (R. 29) Along with this 

Petition, Lexington is filing an emergency motion seeking a stay of the trial court’s 

August 16 order. 

SUMMARY OF ARGUMENT 

Lexington produced competent, uncontroverted evidence substantiating its 

objections to Plaintiffs’ discovery requests. The trial court disregarded such evidence, 

instead adopting a proposed order submitted by Plaintiffs requiring production of 

insurance claims files unrelated to those in the underlying lawsuit. The order improperly 

mandates production of patently irrelevant materials in response to facially overbroad 

requests. Such materials are protected from discovery by the attorney-client and workproduct 

privileges, as well as third-party privacy rights. Compliance with the order would 

impose precisely the type of undue burden and expense on Lexington that the courts of 

this state have routinely protected against. The trial court abused its discretion, and 

Lexington is entitled to extraordinary relief as it has no adequate remedy by appeal. 

5

ARGUMENT 

I. THE TRIAL COURT CLEARLY ABUSED ITS DISCRETION BY 

ORDERING PRODUCTION OF IRRELEVANT DOCUMENTS IN 

RESPONSE TO OVERBROAD REQUESTS 

The trial court ordered Lexington to produce claim files for at least 70 Hurricane 

Ike claimants other than the Plaintiffs. These files have no relevance to any of the issues 

in this case—whether Plaintiffs’ claims were covered under the Primary Policy and 

whether Lexington properly handled Plaintiffs’ claims. (R. 8, 19) The scope of 

permissible discovery is measured by the claims pending in the live pleadings. Lunsford 

v. Morris, 746 S.W.2d 471, 473 (Tex. 1992) (orig. proceeding). Only relevant, nonprivileged 

matters are discoverable, and requests must be “reasonably calculated to lead 

to the discovery of admissible evidence.” TEX. R. CIV. P. 192.3(a); TEX. R. EVID. 401. 

Requests encompassing time periods or activities beyond those at issue in the specific 

case are overbroad. In re Jacobs, 300 S.W.3d 35, 44 (Tex. App.—Houston [14 th Dist.] 

2009, orig. proceeding). When determining overbreadth, courts look to whether the 

request “could have been more narrowly tailored to avoid including tenuous information 

and still obtain the necessary, pertinent information.” In re CSX Corp., 124 S.W.3d 149, 

153 (Tex. 2003) (orig. proceeding). 

Lexington’s handling of each claim must be evaluated on its own merits and 

circumstances. Lexington’s conduct in unrelated claims is irrelevant as it does not make 

the possibility that Lexington acted in bad faith with regard to Plaintiffs’ claims more or 

less probable. This is not a class action case, and allowing Plaintiffs to conduct discovery 

as if it were is simply inequitable. See In re SCI Texas Funeral Serv., Inc., 236 S.W.3d 

6

759, 760 (Tex. 2007) (orig. proceeding). 

Plaintiffs argue that the jury should be able to consider Lexington’s conduct in 

handling other Hurricane Ike claims made under the Primary Policy in assessing 

exemplary damages for common-law bad faith, and additional damages under the DTPA 

or Texas Insurance Code. (R. 3B at 6; R. 4 at 2) Plaintiffs maintain that the claims files 

“may lead to the discovery of evidence proving [Lexington’s] ‘institutional bad faith’— 

that it was ‘knowingly’ and systematically making misrepresentations and delaying 

payment to other insureds as well.” (R. 16 at 3) Neither the caselaw addressing commonlaw 

bad faith, the DTPA, nor the Texas Insurance Code provide any basis for the trier of 

fact to consider a defendant’s prior conduct or handling of non-party claims in assessing 

the propriety of an award of additional or exemplary damages. This Court has 

emphasized that exemplary damages “should center on the unsavoriness of the acts, not 

the actor.” Bennett v. Reynolds, 315 S.W.3d 867, 875 (Tex. 2010); see also Phillip 

Morris U.S.A. v. Williams, 549 U.S. 346, 353-55 (2007). 

This Court previously addressed discovery of information regarding unrelated 

claims and cases from an insurer in In re Allstate County Mutual Insurance Co., 227 

S.W.3d 667 (Tex. 2007) (orig. proceeding). In that instance, the plaintiffs sought 

discovery from an insurer and adjuster regarding claims and cases beyond that before the 

trial court. Id. at 669. The Court granted mandamus relief, noting that 

the plaintiffs’ requests and the trial court’s order [compelling production 

of documents] reflect a misunderstanding about relevance. American 

jurisprudence goes to some length to avoid the spurious inference that 

defendants are either guilty or liable if they have been found guilty or 

liable of anything before. While such evidence might be discoverable in 

7

some cases (e.g., to prove motive or intent), it is hard to see why 

reneging on some other settlement offer makes it more or less probable 

that the insurer reneged on this one. 

Id. at 669-70 (internal citations omitted). 

In this case, Plaintiffs exhibit a similar misunderstanding by seeking discovery 

regarding Lexington’s conduct in adjusting unrelated claims. Plaintiffs admit that this 

discovery is intended to support an award of exemplary or additional damages based on 

Lexington’s handling of other insureds’ claims. (R. 16 at 3) Such an award would be 

unconstitutional as violative of Lexington’s due process rights under Williams. See 549 

U.S. at 353-55. 

In In re GMAC Direct Insurance Co., the court of appeals granted mandamus 

relief from a trial court’s order similar to this one compelling an insurer to produce 

information and documents relating to unrelated claims. No. 09-10-00493-CV, 2010 WL 

5550672 (Tex. App.—Beaumont Dec. 30, 2010, orig. proceeding). The insureds, who 

brought contractual and extra-contractual claims against their insurer, argued that the 

discovery was “designed to produce evidence of a company-wide business practice for 

which [the insureds] may recover additional damages and exemplary damages.” Id. at *1. 

The Beaumont Court of Appeals rejected this argument, concluding instead that the 

insureds’ request constituted a “fishing expedition that harvests vast amounts of tenuous 

information along with the pertinent information that was used in adjusting the 

[insureds’] claim.” Id. As in GMAC, Plaintiffs’ discovery is overbroad and not narrowly 

tailored to only include relevant information and documents. See id. at *2. 

Another illustrative case on relevance is In re Hochheim Prairie Farm Mutual 

8

Insurance Association, 296 S.W.3d 907 (Tex. App.—Corpus Christi-Edinburg 2009, 

orig. proceeding), which involved claims by three different insureds against their insurer 

for breach of contract, bad faith, DTPA, and Insurance Code violations. The trial court 

denied the insurer’s request to sever the insureds’ claims into separate lawsuits based on 

the insureds’ argument that the claims should be tried together to demonstrate the 

insurer’s pattern and practice to underpay or delay payments to the insureds. Id. at 910. 

The appellate court concluded that the trial court abused its discretion by failing to sever 

these unrelated claims into different lawsuits: 

Although the property damage in each of the three claims was caused by 

the same weather event, and although each of the claims was handled by 

the same adjuster, other issues for each claim must be resolved on their 

own merits. Specifically, the underlying factual situations for each of 

the three claims is unique and should therefore be handled separately, 

including whether each claim was covered under the insurance policies 

at issue; the amount of damages sustained in each claim; and whether 

[the insurer] complied with its policy and comcomitant legal obligations 

in the investigation and handling of each claim. 

Id. at 912. Because the facts underlying the handling of each claim under the Primary 

Policy are likewise unique, the claims files for claimants other than the Plaintiffs have no 

relevance to this lawsuit. 

The foregoing authorities notwithstanding, Plaintiffs’ own words may be the most 

damning evidence of the unrelated claims files’ irrelevance. On July 22, 2009, Plaintiffs 

opposed another defendant’s motion to consolidate their claims by arguing that, even as 

among the Plaintiffs, the evidence supporting each individual claim was unique: 

These six cases involve six different Plaintiffs and six different 

Properties… The Plaintiffs are different legal entities; the Properties are 

different apartment complexes that have nothing in common; the extent 

9

of the damages are different; and the handling of the claims by 

Defendant is different…The evidence for each case is different. 

(R. 3H at 3) (emphasis added) Plaintiffs have judicially admitted that each claim should 

stand or fall on its own merits, and should be estopped from contending otherwise in their 

efforts to embark on a fishing expedition into Lexington’s records. See Horizon/CMS 

Healthcare Corp. v. Auld, 34 S.W.3d 887, 905 (Tex. 2000). The discovery compelled is 

not reasonably tailored to matters only relevant to Plaintiffs’ claims and will not lead to 

the discovery of admissible evidence. Texaco, Inc. v. Sanderson, 898 S.W.2d 813, 815 

(Tex. 1995) (orig. proceeding). The claims files Plaintiffs seek simply cannot be relevant 

to resolution of the issues in this case and the trial court abused its discretion by ordering 

production of patently irrelevant documents. In re Mobil Oil Corp., No. 09-06-392-CV, 

2006 WL 3028063, at *3 (Tex. App.—Beaumont 2006, orig. proceeding). 

II. 


ORDERING PRODUCTION IN LIGHT OF UNCONTROVERTED 

EVIDENCE OF UNDUE BURDEN 

Relevance notwithstanding, discovery may still be limited upon a determination 

by the trial court that the “burden or expense of the proposed discovery outweighs its 

likely benefit, taking into account the needs of the case, the amount in controversy, the 

parties’ resources, the importance of the issues at stake in the litigation, and the 

importance of the proposed discovery in resolving the issues.” TEX. R. CIV. P. 192.4(b). 

Lexington timely objected that production of the unrelated claim files would impose an 

undue burden in terms of both time and expense. (R. 1A at 16, 27) Lexington tendered 

supporting evidence that the trial court considered, but apparently rejected, when the 

10

court purportedly granted Lexington’s motion to reconsider the June 13 order. (R. 5E) 

A similar situation was addressed in In re Steadfast Ins. Co., No. 01-09-00235- 

CV, 2009 WL 1424634 (Tex. App.—Houston [1 st Dist.] 2009, orig. proceeding). The 

plaintiff asserted claims against an insurer for common-law bad faith and violations of 

the DTPA and Texas Insurance Code. Id. at *1. Among other things, the plaintiff sought 

the “entire claim file for each claim in which [the insurer has] been alleged to have acted 

in bad faith or in breach of an insurance agreement.” Id. After the trial court ordered the 

insurer to produce the materials, the insurer produced an affidavit substantiating that 

compliance with the court’s order would cost at least $160,000. Id. at *2. The appellate 

court held that the discovery requests were overbroad, not narrowly tailored, and 

constituted an impermissible fishing expedition by the plaintiff. Id. at *4. The insurer was 

ultimately relieved of the obligation to produce the claims files by the appellate court’s 

conditional granting of the insured’s petition for writ of mandamus. Id. 

Lexington’s undisputed affidavit evidence shows compliance with Plaintiffs’ 

request (which would require production of 72 claims files) would take up to 15 days of 

Lexington employee time, up to 142 days of attorney time, and would cost up to 

$227,200 in attorneys’ fees plus copying costs, delivery charges, and other related 

expenses. (R. 5E) Texas courts have found this type of undue burden to be improper. 

See e.g., In re Alford Chevrolet-Geo, 997 S.W.2d 173, 181 (Tex. 1999) (orig. 

proceeding); Fethkenher v. Kroger Co., 139 S.W.3d 24, 30 (Tex. App.—Fort Worth 

2004, no pet.). “In order to justify the cost of producing documents and information, 

there must be a likely benefit.” In re Sears, Roebuck & Co., 123 S.W.3d 573, 578 (Tex. 

11

App.—Houston [14 th Dist.] 2003, orig. proceeding) (citing TEX. R. CIV. P. 192.4(b)). 

In its various pleadings both in the trial court and the court of appeals, Plaintiffs 

respond to Lexington’s burdensomeness objections by (1) excluding from its request “at 

this time” computerized repair estimates, and (2) conceding that Lexington does not have 

to produce privileged documents. (R. 7 at 2, 4) However, Plaintiffs’ proposed limitations 

on the number of documents Lexington ultimately produces fails to take into account the 

source of Lexington’s objection—that the claims files at issue will still need to be 

reviewed by Lexington and its attorneys to identify privileged information and responsive 

documents prior to production. (R. 1A at 16, 27; R. 5E) Even if the documents and 

information in question were within the permissible scope of discovery—which 

Lexington denies—the exorbitant cost of compliance with the August 16 Order would 

outweigh any benefit Plaintiffs could possibly glean from the materials. See In re John 

Crane, Inc., No. 01-03-00698-CV, 2003 WL 22682613, at *5 (Tex. App.—Houston [1 st 

Dist.] 2003, orig. proceeding). 

III. 


DENYING PROTECTION AFTER UNCONTROVERTED EVIDENCE OF 

PRIVILEGE 

The attorney-client and work product privileges are set forth in TEX. R. EVID. 503 

and TEX. R. CIV. P. 192.5, respectively. This Court has held that evidence is not always 

necessary to support a claim of privilege in avoidance of discovery. See e.g., In re Union 

Pacific Resources Co., 22 S.W.3d 338, 341 (Tex. 1999) (orig. proceeding) (citing TEX. 

R. CIV. P. 193.4(a)). Nevertheless, when a party resisting discovery produces evidence 

establishing a prima facie showing of privilege, the burden shifts to the requesting party 

12

to refute the applicability of privilege. In re Harco Nat’l Ins. Co., No. 2-09-351-CV, 2010 

WL 2555629, at *3 (Tex. App.—Fort Worth 2010, orig. proceeding). “The prima facie 

standard requires only the ‘minimum quantum of evidence necessary to support a rational 

inference that the allegation of fact is true.’” In re E.I. DuPont de Nemours and Co., 136 

S.W.3d 218, 223 (Tex. 2004) (orig. proceeding) (quoting Texas Tech Univ. Health Sci. 

Ctr. v. Apodaca, 876 S.W.2d 402, 407 (Tex. App.—El Paso 1994, writ denied)). 

Lexington produced an affidavit signed by its counsel, Connie L. Hawkins. (R. 

5E) Among other things, Ms. Hawkins identifies the categories of information and 

documents included in the claims files sought by Plaintiffs, and states that such materials 

include “confidential financial information and trade secrets of the insured as well as 

communications with Lexington’s attorneys regarding coverage issues and documents 

created in anticipation of litigation.” (R. 5E at 2) 

Lexington made a prima facie showing that the claims files sought by Plaintiffs 

are protected by the attorney-client and work product privileges. See In re E.I. DuPont 

de Nemours and Co., 136 S.W.3d 218, 223-24 (Tex. 2004) (orig. proceeding); Pittsburgh 

Corning Corp. v. Caldwell, 861 S.W.2d 423, 424 (Tex. 1993) (orig. proceeding). 

Moreover, Plaintiffs failed to carry their burden to refute the privileged nature of the 

claims files. See In re Harco Nat’l Ins. Co., No. 2-09-351-CV, 2010 WL 2555629, at *3 

(Tex. App.—Fort Worth 2010, orig. proceeding). 

Based on the evidence submitted by Lexington, the trial court could reach only 

one conclusion—that the claims files are privileged. By ordering production in 

contravention of such privileges, the trial court abused its discretion. See Humphreys v. 

13

Caldwell, 888 S.W.2d 469, 471 (Tex. 1994) (orig. proceeding). 

In addition, Lexington produced evidence to support its objection to producing 

other insureds’ confidential, proprietary documents. (R. 5E). Discovery may be properly 

limited to protect the privacy rights of non-party insureds. In re U.S.A.A., 76 S.W.3d 112, 

115 (Tex. App.—San Antonio 2002, orig. proceeding); Alpha Life Ins. Co. v. Gayle, 796 

S.W.2d 834, 836 (Tex. App.—Houston [14 th Dist.] 1990, orig. proceeding). The trial 

court abused its discretion in this case by ordering the unrelated claim files produced in 

contravention of such rights. 

IV. 

LEXINGTON HAS NO ADEQUATE REMEDY ON APPEAL 

The adequacy of an appellate remedy is determined by balancing the benefits of 

mandamus review against the detriments. In re Team Rocket, L.P., 256 S.W.3d 257, 262 

(Tex. 2008) (orig. proceeding). Mandamus is not limited to cases where there is “no other 

legal operative remedy,” but issues when “other modes of redress are inadequate or 

tedious” or when mandamus affords “a more complete and effectual remedy.” In re 

McAllen Med. Ctr., Inc., 275 S.W.3d 458, 467-68 (Tex. 2008). In reviewing a petition for 

writ of mandamus, a court considers: (1) “whether mandamus will preserve important 

substantive and procedural rights from impairment or loss,” (2) “whether mandamus will 

‘allow the appellate courts to give needed and helpful direction to the law that would 

otherwise prove elusive in appeals from final judgments,’” and (3) “whether mandamus 

will spare litigants and the public ‘the time and money utterly wasted enduring eventual 

reversal of improperly conducted proceedings.’” Team Rocket, 256 S.W.3d at 262. Relief 

is warranted when a trial court subjects taxpayers, parties, and courts to meaningless 

14

proceedings and trials. See id. 

This Court has held that mandamus relief is appropriate where, as here, the 

circumstances demonstrate that allowing the trial proceedings to continue under a trial 

court’s erroneous ruling until final judgment and appeal would result in a waste of 

judicial resources and time. In re AIU Ins. Co., 148 S.W.3d 109, 118 (Tex. 2004) (orig. 

proceeding). An appellate remedy is simply not “adequate” when waiting for it wastes 

not only the time and resources of the parties but the judiciary as well. Id. Thus, an 

appellate remedy is inadequate when the benefits of mandamus review outweigh any 

potential detriments. In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135-38 (Tex. 

2004) (orig. proceeding). The benefits of mandamus review clearly outweigh the 

detriments in this case. 

Mandamus relief is warranted in this case because the August 16 Order mandates 

production of patently irrelevant documents in response to overbroad requests, imposes a 

disproportionate burden on Lexington, and would result in the violation of multiple 

privileges and privacy rights. In re Graco Children’s Products, Inc., 210 S.W.3d 598, 

600 (Tex. 2006) (orig. proceeding); In re CSX Corp., 124 S.W.3d 149, 151 (Tex. 2003) 

(orig. proceeding); Walker v. Packer, 827 S.W.2d 833, 843 (Tex. 1992); In re Harris, 315 

S.W.3d 685, 697-98 (Tex. App.—Houston [1 st Dist.] 2010, orig. proceeding). “Once 

time, labor, and money are spent on improper production, there is no undoing them; 

wasteful costs may be shifted, but never retrieved.” In re Sears, Roebuck & Co., 123 

S.W.3d 573, 575 (Tex. App.—Houston [14 th Dist.] 2003, orig. proceeding). Lexington 

will have no adequate remedy on appeal if forced to expend the resources to comply with 

15

the August 16 order. It will suffer a similar fate if compelled to produce privileged 

information and documents. Lexington thus is entitled to extraordinary relief. 

PRAYER 

Relator, Lexington Insurance Company, respectfully requests that this Court issue 

a writ of mandamus directing Respondent to: 1) vacate her August 16, 2011 order 

compelling discovery; 2) sustain Lexington’s objections to Request Nos. 20 and 37; and 

3) grant Lexington’s Motion for Protective Order. 

Respectfully submitted, 










GIEGER, LABORDE & LAPEROUSE, L.L.C. 



Telephone: (832) 255-6000 

Facsimile: (832) 255-6001 

and 

16













(713) 572-4321Telephone 

(713) 572-4320 Facsimile 

Attorneys for Relator 

Lexington Insurance Company 

17

CERTIFICATION 

I hereby certify that I have reviewed the foregoing Petition for Writ of Mandamus 

and that every statement of fact contained therein is supported by competent evidence 

included in the appendix or mandamus record. 


19

CERTIFICATE OF SERVICE 

I hereby certify that on this the 14 th day of November, 2011, true and correct 

copies of this Petition for Writ of Mandamus and Mandamus Record were served upon 

Respondent and counsel for Real Parties in Interest as indicated below in accordance with 

TEX. R. APP. P. 9.5: 



Harris County Civil Courthouse 

201 Caroline, 11 th Floor 


James L. Cornell 

Cornell & Pardue 

2727 Allen Parkway, Suite 1675 


Marc E. Gravely 

Matthew R. Pearson 

Gravely & Pearson, L.L.P. 



Brendan K. McBride 

McBride Law Firm 



Brian C. Bassett 

Traub Lieberman Straus & Shrewsberry L.L.P. 

303 West Madison Street, Suite 1200 

Chicago, Illinois 60606 

VIA ELECTRONIC FILING 






20

INDEX TO APPENDIX 

1. Order Granting In Part Lexington’s Motion to Reconsider Order Granting 

Plaintiffs’ Expedited Motion to Compel Discovery (8/16/11) 

2. Memorandum Order Denying Lexington’s Petition for Writ of Mandamus 

(10/27/11) 

21

APPENDIX TAB 1

Certified Document Number: 49654575 - Page 1 of 2

Certified Document Number: 49654575 - Page 2 of 2

I, Chris Daniel, District Clerk of Harris 

County, Texas certify that this is a true and 

correct copy of the original record filed and or 

recorded in my office, electronically or hard 

copy, as it appears on this date. 

Witness my official hand and seal of office 

this August 17, 2011 

Certified Document Number: 

49654575 Total Pages: 2 

Chris Daniel, DISTRICT CLERK 

HARRIS COUNTY, TEXAS 

In accordance with Texas Government Code 406.013 electronically transmitted authenticated 

documents are valid. If there is a question regarding the validity of this document and or seal 

please e-mail support@hcdistrictclerk.com

APPENDIX TAB 2

Petition for Writ of Mandamus Denied and Memorandum Opinion filed October 27, 

2011. 

In The 

Fourteenth Court of Appeals 

____________ 

NO. 14-11-00780-CV 

____________ 

IN RE LEXINGTON INSURANCE COMPANY, Relator 

ORIGINAL PROCEEDING 

WRIT OF MANDAMUS 

133rd District Court 

Harris County, Texas 

Trial Court Cause No. 2009-22372 

M E M O R A N D U M 

O P I N I O N 

This discovery mandamus arises from a suit for contractual and extra-contractual 

damages from Hurricane Ike claims on five apartment complexes. The apartment 

complex owners, JAW The Lake, L.L.C., JAW Timberwalk, L.L.C., JAW Scarsdale Park, 

L.L.C., JAW Boardwalk of Baytown, L.L.C., and JAW Chateau Creole, L.L.C, the real 

parties in interest, filed separate suits against relator, Lexington Insurance Company, 

complaining of its handling of the claims, and the suits were consolidated in the underlying 

action.

On September 8, 2011, relator filed an amended petition for writ of mandamus in 

this court. 1 See Tex. Gov't Code § 22.221. Relator asked this court to order the 

Honorable Jaclanel McFarland, presiding Judge of the 133rd District Court of Harris 

County, Texas, to set aside her order signed August 16, 2011, reconsidering her prior order 

and granting the real parties in interest’s motion to compel production of discovery. 

Relator complains that the trial court abused its discretion in ordering unduly burdensome 

production of irrelevant documents in response to overbroad requests. Relator also asserts 

that some documents subject to the court’s order are privileged. 

Relator also filed an emergency motion asking that we stay the trial court’s order 

pending our review of its petition. See Tex. R. App. P. 52.10(a). On September 9, 2011, 

this court granted relator’s motion and requested a response from the real parties in interest, 

which has now been filed. 

Mandamus is an extraordinary remedy that will issue only if (1) the trial court 

clearly abused its discretion and (2) the party requesting mandamus relief has no adequate 

remedy by appeal. In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135–36 (Tex. 2004). 

A trial court abuses its discretion if it reaches a decision so arbitrary and unreasonable as to 

amount to a clear and prejudicial error of law, or if it clearly fails to analyze or apply the 

law correctly. In re Cerberus Capital Mgmt., L.P., 164 S.W.3d 379, 382 (Tex. 2005). 

Generally, the scope of discovery is within the trial court's discretion; however, the 

trial court must make an effort to impose reasonable discovery limits. See In re CSX 

Corp., 124 S.W.3d 149, 151 (Tex. 2003). A discovery order that compels overly broad 

discovery well outside the bounds of proper discovery is an abuse of discretion for which 

mandamus may issue. In re Deere & Co., 299 S.W.3d 819, 820–21 (Tex. 2009). The 

party resisting discovery bears the ―heavy burden‖ of establishing an abuse of discretion 

1 

Relator’s first petition for writ of mandamus was dismissed as moot after the trial court granted relator’s 

motion to reconsider and vacated its order signed June 13, 2011. See In re Lexington Insurance Company, 

No. 14-11-00681-CV, 2011 WL 3925567 (Tex. App.—Houston [14th Dist.] Sept. 8, 2011, orig. 

proceeding) (mem. op.). 

2

and inadequate appellate remedy. In re CSX, 124 S.W.3d at 151. The party making the 

objection must present any evidence necessary to support the objection. See Tex. R. Civ. 

P. 193.4(a); In re CI Host, Inc., 92 S.W.3d 514, 516 (Tex. 2002). 

Relator has not established that it is entitled to extraordinary relief. Accordingly, 

we deny relator’s petition for writ of mandamus. This court’s September 9, 2011, stay 

order is lifted. 

PER CURIAM 

Panel consists of Chief Justice Hedges and Justices Anderson and Christopher. 

3

Petition for Writ of Mandamus - Supreme Court of Texas

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