Baker v. St. Paul Travelers Insurance

United States Court of Appeals
For the First Circuit
No. 11-1897
HEIDI M. BAKER,
Plaintiff, Appellant,
v.
ST. PAUL TRAVELERS INSURANCE COMPANY,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
[Hon. Mary M. Lisi, U.S. District Judge]
Before
Boudin, Selya and Stahl, Circuit Judges.
Merrill J. Friedemann, with whom Anthony J. Gianfrancesco,
William F. Warren, and Baluch, Gianfrancesco & Mathieu were on
brief, for appellant.
Paul V. Sullivan, with whom Sullivan, Whitehead & DeLuca LLP
was on brief, for appellee.
February 28, 2012
STAHL, Circuit Judge. In 2010, we remanded this state
law insurance action for appropriate discovery on the narrow
question of whether plaintiff-appellant Heidi M. Baker's employer
"explicitly purchased" underinsured motorist (UIM) coverage from
defendant-appellee St. Paul Travelers Insurance Company (St. Paul)
for the purpose of providing such coverage to employees like Baker
who are injured in the course of their employment. After that
discovery occurred, the district court denied Baker's motion to
compel further discovery and for sanctions against St. Paul, and
the court granted summary judgment in favor of St. Paul. Baker
appeals both rulings. We affirm.
I. Facts & Background
We recounted the factual and procedural history of this
case in some detail in Baker v. St. Paul Travelers Insurance Co.
(Baker I), 595 F.3d 391 (1st Cir. 2010), and we thus summarize only
the relevant background here.
Baker is a Rhode Island resident and a former employee of
Safety Source Northeast (Safety), a Massachusetts corporation. On
December 17, 2002, Baker was driving one of Safety's vehicles as
part of her job duties and was seriously injured in a car accident
caused by the other driver. The accident occurred in Boston,
Massachusetts. Baker filed a third-party claim against the
tortfeasor, whose insurance company paid the full policy limit of
$20,000.00, which was insufficient to cover Baker's damages. She
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also filed for and received workers' compensation (WC) benefits
through the Rhode Island WC system, and she made a UIM claim
against her personal automobile insurance company, which she
settled for the policy limit of $25,000.00. Finally, Baker sought
to recover under the UIM provision of Safety's automobile insurance
policy, which was provided by St. Paul.
St. Paul denied Baker's claim, citing Massachusetts law
for the proposition that an employee cannot recover for
work-related injuries under both WC and her employer's UIM
coverage. Baker challenged that denial in Rhode Island state
court, and St. Paul removed the case to federal district court.
Baker argued that Rhode Island law should apply to the
interpretation of the policy, but that even under Massachusetts
law, the bar on recovery under both WC and the employer's UIM
coverage would not apply, because the UIM coverage was a
bargained-for provision.
In Baker I, we determined that Massachusetts law does
indeed apply in this case. See id. at 392-93. In Massachusetts,
an employee generally cannot recover under both WC and her
employer's UIM policy, see Berger v. H.P. Hood, Inc., 624 N.E.2d
947 (Mass. 1993); Nat'l Union Fire Ins. Co. v. Figaratto, 667
N.E.2d 877 (Mass. 1996), except where the employer has "explicitly
purchased" the UIM coverage "for the purpose of providing [such]
coverage (or any other coverage) to employees injured in the course
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of their employment," Nat'l Union, 667 N.E.2d at 881. We thus
found that Baker's appeal turned on whether Safety had "explicitly
purchased" its UIM coverage within the meaning of the National
Union carve-out, and we remanded the case for appropriate discovery
to answer that discrete question. Baker I, 595 F.3d at 395.
On remand, after discovery proceeded, Baker filed a
motion to compel further discovery and to impose sanctions against
St. Paul as a result of a dispute that arose during the deposition
of St. Paul's Rule 30(b)(6) witness. See Fed. R. Civ. P. 30(b)(6).
The parties also cross-moved for summary judgment. The district
court denied Baker's discovery motion and granted summary judgment
to St. Paul. This timely appeal followed.
II. Discussion
A. The discovery motion
We review discovery orders for abuse of discretion, Ji v.
Bose Corp., 626 F.3d 116, 121 (1st Cir. 2010), including the denial
of a motion for discovery sanctions, Meléndez-García v. Sánchez,
629 F.3d 25, 33 (1st Cir. 2010).
In response to Baker's Rule 30(b)(6) subpoena, St. Paul
designated Deborah Restaine, a Product Management Director. Toward
the very end of Restaine's nearly three-hour deposition, St. Paul
instructed Restaine not to answer several of Baker's questions,
which St. Paul believed were outside the scope of the discovery
that we had ordered on remand. Baker concluded the deposition and,
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eighteen days later, moved to compel further discovery and for
sanctions, arguing that Restaine was not sufficiently knowledgeable
to have served as a Rule 30(b)(6) witness and that St. Paul had
violated Rule 30(c)(2) by instructing Restaine not to answer. The
magistrate judge denied Baker's non-dispositive motion, and the
district court affirmed. See Fed. R. Civ. P. 72(a).
Though Baker's initial motion requested both further
discovery and sanctions against St. Paul, she has focused her
appeal on the district court's denial of her motion for sanctions.
In other words, she has made no real argument that we should order
St. Paul to make Restaine available for further questioning or
designate another Rule 30(b)(6) witness. Baker has therefore
waived any review of the denial of her motion to compel. See
United States v. Zannino, 895 F.2d 1, 17 (1st Cir. 1990) ("[I]ssues
adverted to in a perfunctory manner, unaccompanied by some effort
at developed argumentation, are deemed waived."). However, if
Baker had properly put the issue before us, we would affirm the
lower court's refusal to order further discovery. Baker has not
demonstrated that she was unable to obtain information during the
deposition that fell within the scope of the discovery we mandated
in Baker I.1 We thus fail to see how either St. Paul's
1
The only claim Baker has made in this regard is that, but
for the instructions not to answer, she would have questioned
Restaine regarding the existence of a second Safety insurance
policy, BA 01320676, which included an endorsement in which Safety
certified, in exchange for a reduced premium, that the vehicles
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instructions not to answer or Restaine's alleged lack of knowledge
"resulted in substantial prejudice" to Baker, nor has Baker come
close to convincing us that the lower court's order on the motion
to compel "was plainly wrong." Ji, 626 F.3d at 122 (citations and
internal quotation marks omitted).
Turning to the motion for sanctions, we begin with St.
Paul's act of instructing Restaine not to answer a series of
questions at the end of her deposition. Rule 30(c)(2) states that
"[a] person may instruct a deponent not to answer only when
necessary to preserve a privilege, to enforce a limitation ordered
by the court, or to present a motion under Rule 30(d)(3)." Fed. R.
Civ. P. 30(c)(2). Baker argues that St. Paul's instructions not to
answer violated Rule 30(c)(2) and that St. Paul is thus
sanctionable under Rule 30(d)(2), which allows a district court to
"impose an appropriate sanction -- including the reasonable
expenses and attorney's fees incurred by any party -- on a person
who impedes, delays, or frustrates the fair examination of the
deponent." Fed. R. Civ. P. 30(d)(2).
covered by that policy would only carry employees. However, BA
01320676 is not the policy that covered the vehicle Baker was
driving when she was injured, and its endorsement is thus
inapplicable here. The question for remand was whether Safety
explicitly purchased the UIM coverage under policy MA 05700143 to
provide that coverage to its employees. The inability to question
Restaine, or another Rule 30(b)(6) witness, about policy BA
01320676 therefore did not substantially prejudice Baker. Ji, 626
F.3d at 122.
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Though the magistrate judge found that it was
procedurally improper for St. Paul to instruct Restaine not to
answer, he reviewed the ninety-eight-page transcript of Restaine's
deposition and determined that all but one of Baker's objected-to,
unanswered questions (which began on page eighty-six) were indeed
outside the narrow scope of the discovery that we prescribed in
Baker I. The only question that fell within the scope of discovery
related to the premium that Safety had paid for the optional UIM
coverage included in the policy at issue. The magistrate judge
found, however, that Baker already knew the answer to that question
and therefore was not prejudiced when St. Paul instructed Restaine
not to answer it.
We need not address whether it was proper under Rule 30
for St. Paul to instruct Restaine not to answer Baker's questions
"to enforce a limitation ordered by the court." Fed. R. Civ. P.
30(c)(2). Even assuming, as the magistrate judge concluded, that
St. Paul should not have issued the instructions,2 Baker has not
satisfied the abuse of discretion standard. See Meléndez-García,
629 F.3d at 33. Because "[t]rial judges have considerable
discretion in the selection and imposition of sanctions," Barreto
v. Citibank, N.A., 907 F.2d 15, 16 (1st Cir. 1990), a party
2
Indeed, St. Paul's instruction to Restaine not to answer
Baker's question regarding the premium that Safety paid for the UIM
coverage was clearly improper under Rule 30(c)(2), since, as the
magistrate judge found, that question fell within the scope of the
discovery we ordered.
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appealing an order with regard to sanctions "bears a formidable
burden in attempting to convince the court of appeals that the
lower court erred," Koken v. Black & Veatch Constr., Inc., 426 F.3d
39, 53 (1st Cir. 2005) (citation and internal quotation marks
omitted). Baker has not even attempted to argue that any of her
unanswered questions fell within the scope of discovery, nor has
she demonstrated that St. Paul "impede[d], delay[ed], or
frustrate[d] the fair examination of the deponent." Fed. R. Civ.
P. 30(d)(2). She therefore has not met her "formidable burden" of
convincing us that the district court abused its discretion.
Koken, 426 F.3d at 53.
Baker's second argument is that Restaine was not
sufficiently knowledgeable or prepared for the deposition, so the
district court should have treated her testimony as a non-
appearance and issued sanctions under Rule 37. See Fed. R. Civ. P.
37(d)(1)(A)(i). A Rule 30(b)(6) designee must be able to testify
on behalf of an organization "about information known or reasonably
available to the organization." Fed. R. Civ. P. 30(b)(6). Rule
37(d)(1)(A)(i), in turn, allows a court to issue sanctions if the
Rule 30(b)(6) witness "fails, after being served with proper
notice, to appear for that person's deposition." Fed. R. Civ. P.
37(d)(1)(A)(i). Baker cites a Fifth Circuit case for the
proposition that, when an organization's Rule 30(b)(6) designee is
not knowledgeable about the relevant facts, "the appearance is, for
-8-
all practical purposes, no appearance at all," and the organization
is susceptible to sanctions under Rule 37. Resolution Trust Corp.
v. S. Union Co., 985 F.2d 196, 197 (5th Cir. 1993); see also, e.g.,
Black Horse Lane Assoc., L.P. v. Dow Chem. Corp., 228 F.3d 275,
299-305 (3d Cir. 2000).
What Baker overlooks is that we held in R.W.
International Corp. v. Welch Foods, Inc., 937 F.2d 11 (1st Cir.
1991), that sanctions for non-appearance are only available when a
deponent "'literally fails to show up for a deposition session.'"
Id. at 15 n.2 (quoting Salahuddin v. Harris, 782 F.2d 1127, 1131
(2d Cir. 1986)). R.W. International did not distinguish between
the deposition of a natural person and a Rule 30(b)(6) deposition,
which the Fifth Circuit found "presents a potential for abuse which
is not extant where the party noticing the deposition specifies the
deponent." Resolution Trust, 985 F.2d at 197. Because a
corporation controls whom to designate for a Rule 30(b)(6)
deposition, the Fifth Circuit concluded, the corporation should be
subject to sanctions if it designates a witness who is not
knowledgeable about the relevant facts. Id.
We need not decide today whether we agree with the Fifth
Circuit, because Baker has failed to even mention R.W.
International in her brief, much less convince us why it is
distinguishable. See Zannino, 895 F.2d at 17 ("It is not enough
merely to mention a possible argument in the most skeletal way,
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leaving the court to do counsel's work, create the ossature for the
argument, and put flesh on its bones."). In any event, on these
facts, we would not carve out an exception to the R.W.
International rule for Rule 30(b)(6) depositions. In Resolution
Trust, both Rule 30(b)(6) designees literally "possessed no
knowledge relevant to the subject matters identified in the Rule
30(b)(6) notice."3 Resolution Trust, 985 F.2d at 196. Similarly,
when the Third Circuit affirmed an award of sanctions for
constructive non-appearance of a Rule 30(b)(6) witness in Black
Horse Lane, it was based on a record demonstrating that the Rule
30(b)(6) designee had done "nothing except show his face," "refused
to answer questions in an intelligent way," "refused to prepare,"
"and just literally thumbed his nose at the defendants and,
frankly, at the Court." 228 F.3d at 300.
That was clearly not the case here. Restaine had worked
extensively in the insurance industry and specifically in
underwriting for much of her career. She testified that she had
reviewed the documents at issue in this case, and she answered all
of Baker's questions, except when she was instructed not to do so
at the very end of her deposition. Tellingly, Baker has pointed us
to no evidence that she ever objected to Restaine's qualifications
3
During one of the depositions at issue in Resolution Trust,
counsel for the defendant "recited each item of inquiry designated
in the notice and asked if [the Rule 30(b)(6) designee] had any
knowledge thereof. In every instance the answer was 'no.'" 985
F.2d at 197.
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during the deposition itself. The fact that Restaine had to review
certain documents before answering Baker's questions about those
documents, which Baker makes much of on appeal, does not convince
us that Restaine was an unfit Rule 30(b)(6) witness.
B. The motion for summary judgment
We review de novo the district court's decision to grant
St. Paul's summary judgment motion.4 Hartford Fire Ins. Co. v. CNA
Ins. Co., 633 F.3d 50, 53 (1st Cir. 2011). We will uphold the
grant of summary judgment "if the record, evaluated in the light
most favorable to the nonmoving party, shows that there is no
genuine issue as to any material fact and that the movant is
entitled to judgment as a matter of law." Id. at 54 (citation and
internal quotation marks omitted). "A dispute is 'genuine' if the
evidence about the fact is such that a reasonable jury could
resolve the point in favor of the non-moving party. A fact is
'material' if it has the potential of determining the outcome of
the litigation." Scottsdale Ins. Co. v. Torres, 561 F.3d 74, 77
(1st Cir. 2009) (citation omitted).
The only question for remand was whether Safety
"explicitly purchased" the UIM coverage under policy MA 05700143
"for the purpose of providing [such] coverage (or any other
coverage) to employees injured in the course of their employment."
4
Because we find that the district court properly granted
summary judgment to St. Paul, we need not address the denial of
Baker's cross-motion for summary judgment.
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Nat'l Union, 667 N.E.2d at 881. In National Union, the
Massachusetts Supreme Judicial Court did not explain what it meant
by "explicitly purchased," see id., but in Baker I, we found that
the crucial inquiry was "whether Safety . . . bargained for the UIM
coverage contained in its policy with the intention of protecting
its workers from damage caused by uninsured [or underinsured]
motorists," 595 F.3d at 395. Thus, to demonstrate her eligibility
for UIM benefits under the policy, Baker would have to show that,
in purchasing or bargaining for the UIM coverage, Safety
specifically intended to provide that coverage to its employees.
Nat'l Union, 667 N.E.2d at 881; Baker I, 595 F.3d at 395.
Otherwise, the general rule preventing an employee in Massachusetts
from recovering under both WC and her employer's UIM provision
would apply. Nat'l Union, 667 N.E.2d at 880.
Having now had the opportunity to conduct appropriate
discovery on remand, Baker has pointed to no evidence in the record
that would permit a reasonable jury to resolve this case in her
favor. Scottsdale Ins. Co., 561 F.3d at 77. Specifically, she has
not pointed to any evidence that Safety purchased or bargained for
the UIM coverage under policy MA 05700143 to provide its "employees
with additional protection from damages caused by underinsured
motorists." Baker I, 595 F.3d at 394. Nor has she presented any
evidence that Safety strictly prohibited non-employees from riding
in company vehicles, or that the company ever represented to her
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that she would receive UIM coverage as an employee, such that we
might infer that Safety purchased or bargained for the UIM coverage
to protect its employees.
The testimony that was elicited from Safety's president
and its insurance agent during their depositions on remand directly
contradicts Baker's claim that Safety intended to provide UIM
coverage to its employees. Rather, that testimony indicates that
Safety was unaware of the very existence of UIM coverage under
policy MA 05700143 and that the insurance agent included the UIM
coverage in order to protect the company in the event that an
employee was involved in an accident outside of Massachusetts or
carried a non-employee passenger in the vehicle.
Safety's president, Robert Kingman, testified that he was
the sole person at the company responsible for purchasing insurance
and making insurance-related decisions. Kingman had been working
with insurance agent Robert Muenzberg, Jr. since sometime in the
1990s. Kingman testified that he never told Muenzberg to put UIM
coverage or any other particular provisions in the policy at issue,
that he "never even understood" that he was purchasing UIM coverage
under the policy, and that it "never would have occurred to [him]"
that the UIM coverage would protect employees from damage caused by
underinsured motorists.
Muenzberg testified that he "probably" discussed UIM
coverage with Kingman "at some point," because it was a "typical
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conversation" that he had with clients purchasing commercial auto
insurance policies in Massachusetts, though he did not remember
such a conversation specifically. It was Muenzberg's understanding
that a UIM provision would not apply to an employee in
Massachusetts, because the employee would be covered by WC. Thus,
as Muenzberg explained during his deposition, if he did discuss UIM
coverage with Kingman, that conversation would have been about the
need for UIM coverage in the event of "out-of-state exposure beyond
the compulsory Massachusetts limits and the possibility that the
vehicle might have a passenger in it that's not an employee,
perhaps a customer." What is clear from Muenzberg's deposition
testimony is that Safety certainly never communicated to him that
the company wanted UIM coverage to protect its employees.
Recognizing that there is no direct evidence that Safety
explicitly purchased or bargained for the UIM coverage with the
intention of protecting its employees, Baker claims that Safety had
a policy prohibiting non-employees from riding in company vehicles
and that we should therefore infer that Safety purchased the UIM
coverage for its employees. We reject that claim because we find
no evidence of such a policy. Kingman specifically testified
during his deposition that there was no formal or informal policy
and that allowing non-employees in the vehicles was "just not [a]
very good business practice." Kingman's son, Brian Kingman,
confirmed that, while the company "van was meant for work" and
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"[i]t would be frowned upon" for an employee to bring a passenger
in the van, an employee could do so if the trip "was business
related."5 And Muenzberg testified that, if Safety had a policy
forbidding passengers in the vehicles, Kingman would have told him
and "we would have thought about the coverage differently." Absent
any evidence that Safety believed the vehicle in question only
carried employees, and given the testimony to the contrary, we will
not infer that the company must have purchased the UIM coverage for
the explicit purpose of covering its workers injured on the job.
Grasping at straws, Baker claims that the existence of a
second Safety Massachusetts insurance policy (BA 01320676) creates
a genuine issue of material fact, because that policy included an
endorsement in which Safety certified that the vehicles covered by
the policy would only carry employees.6 As discussed above, BA
01320676 is not the policy that covered the vehicle Baker was
driving when she was injured. Nonetheless, Baker argues in her
5
Baker points to the fact that Brian Kingman told her that
she could not use the company vehicle to pick up her children at
school, but, as the district court found, "discouraging or
prohibiting personal use of the vehicles does not correlate with a
prohibition on all non-employee passengers at all times,
specifically with regard to customers." Baker v. Safety Source
Ne., No. 07–314–ML, 2011 WL 2181175, at *5 (D.R.I. June 3, 2011).
6
The endorsement stated in relevant part: "You paid a reduced
premium for Personal Injury Protection Coverage because you
certified that your covered 'auto' would be used only in your
business and only to carry your 'employees' and that you have and
will continue to have a Massachusetts Workers' Compensation Policy
during the period of this policy."
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brief that the BA 01320676 endorsement "confirms unmistakably that
Ms. Baker's employer demanded that no one other than the employees
were permitted to be in the company vehicles." If that were true,
however, Baker fails to explain why Safety would not have executed
a similar endorsement for policy MA 05700143. Though we must draw
all reasonable inferences in Baker's favor, she cannot rely
exclusively on "unsupported speculation" to defeat St. Paul's
motion for summary judgment. Barry v. Moran, 661 F.3d 696, 703
(1st Cir. 2011) (citation and internal quotation marks omitted).
Baker's final claim -- that there remains a genuine issue
of material fact as to whether Safety's witnesses and documentary
evidence are credible -- "is squarely foreclosed by our case law."
Harriman v. Hancock Cnty., 627 F.3d 22, 33 (1st Cir. 2010); see
also Sears, Roebuck & Co. v. Goldstone & Sudalter, P.C., 128 F.3d
10, 18 (1st Cir. 1997) ("A party cannot create an issue for the
trier of fact by relying on the hope that the jury will not trust
the credibility of witnesses." (citation and internal quotation
marks omitted)).
Although Safety apparently discouraged its employees from
bringing passengers in company vehicles, the evidence indicates
that the company either purchased the UIM coverage unwittingly or
out of a recognition that non-employees, including customers, might
nonetheless wind up in company cars. Because Baker has failed to
demonstrate a genuine issue of material fact as to whether Safety
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explicitly purchased or bargained for the UIM coverage under policy
MA 05700143 with the specific intention of providing such coverage
to employees injured on the job, the National Union carve-out does
not apply here. See 667 N.E.2d at 881. The district court
therefore properly granted St. Paul's motion for summary judgment
and denied Baker's. Hartford Fire Ins. Co., 633 F.3d at 53.
III. Conclusion
We affirm the district court's orders. No costs are
awarded.
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