*1 This matter came before the Court on April 28, 2022. After considering the arguments of the parties and the entire record of the case, Plaintiffs' Motion to Compel is GRANTED, and Defendant is ordered to produce all documents withheld as identified in Defendant's privilege log which are related to prior claims identified as the Addus claims and Love claims [Doc. 65-6] as well as unredacted copies of documents referenced in Defendant's supplemental privilege log [Doc. 65-7] and attached to Plaintiffs' Motion to Compel as Exhibit 9 [Doc. 65-8] within three business days from the entry of this Order.

Plaintiffs filed this action for equitable reformation of an insurance contract, breach of contract, and bad faith penalty stemming from Defendant AmGuard Insurance Company's denial of coverage to Shou & Shou, Inc. in an underlying case filed in the State Court of DeKalb County, Georgia. In the underlying case, Plaintiffs sued Shou & Shou, Inc. for injuries sustained by Plaintiff Hee Jin Lowery. Shou & Shou tendered the suit for defense and indemnity to AmGuard, but AmGuard denied coverage on the grounds that Shou & Shou was not a named insured or additional insured under the applicable policy. The underlying litigation against Shou & Shou proceeded to resolution by way of a settlement in which Shou & Shou, Inc. agreed to a consent judgment in the amount of $1,000,000.00 and an assignment of claims Shou & Shou may have against AmGuard Insurance Company.

Thereafter, Plaintiffs, as judgment creditors and assignees of Shou & Shou, instituted the present action seeking reformation of the insurance contract based on mutual mistake. Prior to any discovery, Defendant filed a Motion for Judgment on the Pleadings wherein in it argued that its handling of prior claims against Shou & Shou were merely business decisions and that its intent was to insure only “Noodle, Inc.” [Doc. 20] In denying the Defendant's motion, the Court noted that evidence of AmGuard's handling of prior claims on behalf of Shou & Shou could support Plaintiffs' allegations of mutual mistake. [Doc. 33, p. 8-9] During discovery, Plaintiffs requested the complete claim files for two prior claims against Shou & Shou both of which resulted in litigation, the Addus claim and the Love claim. In response, Defendant produced portions of the claims files but withheld some documents and redacted others asserting work product privilege. See Defendant's privilege log of documents withheld numbered 1 through 7 and 9 through 35 [Doc. 65-6] and supplemental privilege log identifying documents from the Addus and Love claim redacted by Defendant [Doc. 65-7 and 65-8] Thereafter, Plaintiff moved to compel production of the withheld and redacted documents.

Federal Rule of Civil Procedure 26(b)(1) provides that parties may obtain discovery regarding any non-privileged matter that is relevant to any party's claim or defenses. The scope of discovery is broad and encompasses any non-privileged matter proportional to the needs of the case, considering the importance of the issues, the amount in controversy, the party's relative access to relevant information, the resources, importance of discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Id. Further, the term “relevant” is broadly construed to encompass any matter that bears on or reasonably could lead to other matters that bear upon any issue in the case. Auto-Owners v. Southeast Floating Docks, Inc., 231 F.R.D. 426, 430 (M.D. Fla. 2005) (quoting Oppenheimer Fund v. Sanders, 437 US 340, 351 (1978)) Where documents are withheld based on the work product privilege, the burden of establishing that such documents are protected from discovery is on the party withholding the discovery. Milinazzo v. State Farm Ins. Co., 247 F.R.D. 691, 698 (S.D. Fla. 2007) Whether or not to compel discovery pursuant to Fed. R. Civ. P. 37 is committed to the sound discretion of the trial court. Commercial Union Ins. Co. v. Westrope, 738 F.2d 729,731 (11th Cir. 1984)

*2 Federal Rule of Civil Procedure 26(b)(3) sets forth the work product doctrine as follows:

As an initial matter, the Court finds that the discovery withheld and redacted by AmGuard from the previous claims does not fall within the protection of 26(b)(3)(A) because these documents were not prepared “by or for another party or its representative” but by or for Shou & Shou, Inc. As assignees of Shou & Shou, Inc., Plaintiffs stand in their shoes. In both of the referenced prior claims, Shou & Shou, Inc. was a named Defendant. AmGuard hired attorneys to defend Shou & Shou and reported to AmGuard who resolved both of the claims by way of settlement. Clearly, under such circumstances, Shou & Shou would be entitled to the work product of its own attorneys or representatives. See Franklin v. Nat'l Gen. Assur. Co., 2:13-cv-103-WKW, 214 U.S. Dist. LEXIS 199284 (M.D. AL 2014) As assignees of Shou & Shou, Plaintiffs are entitled to this work product.

Even if the withheld information did qualify as work product protected from disclosure, Plaintiffs have shown that they have a substantial need for the materials to prepare their case and cannot, without undue hardship, obtain their substantial equivalent by other means. In this regard, Defendant denies any knowledge that “Noodle, Inc.” was a fictious entity and claims that it lacked sufficient information to admit or deny whether “Noodle, Inc.” had any insurable interest in the restaurant located at 3693 Main Street, College Park, Georgia. Further, Defendant claims that it lacks sufficient information to admit or deny that in 2016 and 2017, the College Park restaurant was operated under the trade name “Noodle.” [Doc. 65-9] The inability of Defendant to admit or deny either of these matters convinces the Court that Plaintiffs have a substantial need for the withheld and redacted information and cannot obtain its substantial equivalent by other means without undue hardship. See Underwriters Ins. Co. v. Atlanta Gas Light Co., 248 F.R.D. 663, 669 (N.D. Ga. 2008) (Plaintiff's need for information in insurer's claim file in a third-party bad faith action is substantial and often the only reliable indication of whether the insurance company acted in bad faith.) See also, Camacho v. Nationwide Mut. Ins. Co., 287 F.R.D. 688, 695 (N.D. Ga. 2012)

In addition to finding that Plaintiffs are entitled to the requested discovery based on substantial need, the Court concludes that the Defendant has affirmatively waived any work product privilege by asserting that its handling of prior claims against Shou & Shou constituted a business decision and not a mutual mistake. Having injected the issue of its decision to defend and resolve prior claims against Shou & Shou as a mere business decision, AmGuard cannot now withhold this highly relevant information from its handling of prior claims on behalf of Shou & Shou.

*3 Implied waiver also known as the “Offensive Use” or “At Issue” Doctrine has been defined as follows:

Applying the Offensive Use/At Issue Doctrine in the present case, it is the Court finds that Defendant has impliedly waived the attorney work product privilege as it relates to the Addus and Love claims. By asserting the privilege, AmGuard is seeking to withhold highly relevant information it relied upon in providing a defense and indemnifying Shou & Shou in their earlier claims. Second, while withholding this information, AmGuard is affirmatively asserting that its decision to defend Shou & Shou and settle the earlier claims constituted a business decision rather than a mutual mistake. if the privilege is allowed to stand, Plaintiffs would be denied information vital to their case. Given AmGuard's assertion that it only provided a courtesy defense in the prior claims and settle them as a business decision, the Court finds an implied waiver of any claim of work product privilege.

Based on the foregoing, Plaintiffs' Motion to Compel is hereby GRANTED. Within three business days, Defendant is ordered to produce those documents identified on its privilege log numbered 1 through 7 and 9 through 35 and unredacted copies of documents bates stamped [GUARD] 91, 903-904, 906-907, 911-913, 928-930, 1033, 1037-1039, 1066-1068, 1243-1245, 1247-1248, 1250-1254, 1257, and 1260-1263.

SO ORDERED this 2nd day of May, 2022.