I have published on four occasions concerning good orders coming out of the Barten v. State Farm case.1 Well, it seems more courts are issuing favorable discovery orders, including a recent ruling from a federal district court in Arkansas.2

At issue in Sims v. State Farm Mutual Automobile Insurance Company, was the policyholder’s motion compelling State Farm to produce information relating to the carrier’s business model for claim underpayment. The Sims decision is short, so I encourage everybody to read the opinion in its entirety. This sentence from the decision, however, should give you a flavor:

[A]n insurance company has a financial incentive to deny a claim: obviously, it does.

And here are the CliffsNotes of the Sims order:

  • “State Farm must produce the requested claims-handling materials that relate to the handling of underinsured motorist claims in Arkansas even if those materials had ceased being used when Sims’s accident occurred.”3
  • State Farm was ordered to produce materials concerning its Total Evaluation and Claim Handling (T.E.A.C.H) program courses.
  • State Farm was ordered to produce materials concerning the compensation/bonus/incentive programs in place for carrier employees involved with Sims’s claim directly and/or at the supervisory level.4
  • State Farm was ordered to produce materials concerning its Achieving Claims Excellence program.5
  • State Farm was ordered to produce materials concerning its document retention policies. Reason being, State Farm was telling Sims that certain materials produced in other litigation did not exist.
  • State Farm was ordered to produce information whether any employees related to Sims’s claim were disciplined for failing to meet the carrier’s claim payout agenda. And, similarly, State Farm was ordered to produce information concerning State Farm’s evaluation of personnel involved with Sims’s claim directly or at the supervisory level.

There is also some favorable language on pages nine through eleven of the opinion concerning application of the work-product immunity and attorney-client privilege objections when it comes to a policyholder’s “claim file” request. In sum, policyholder advocates should make use of the Sims decision.

1 Barten v. State Farm Mut. Auto. Ins. Co., No. 12-399 (D. Ariz.).
2 Sims v. State Farm Mut. Auto. Ins. Co., No. 4:13CV00371 (E.D. Ark. Apr. 30, 2014).
3 Id. at 4.
4 Such programs, of course, are geared toward monetarily rewarding employees for their augmentation of corporate profit through claim underpayment.
5 Again, the claims excellence that State Farm desired from its personnel through this program was the lowering of claim payout in order to increase corporate profit.