Personal injury lawsuits often involve liability insurance carriers who conduct investigations of the claim and alleged injuries. As a part of their investigation, insurers routinely obtain statements from their insured. In discovery, plaintiffs’ attorneys usually include a demand for any investigative statements, including statements taken by insurers. New York State courts have held that these statements are conditionally protected from discovery unless the plaintiff can establish either that they have a “substantial need of the materials” or that they are “unable without undue hardship to obtain the substantial equivalent of the materials by other means.”
In Fusco v. Hansen,1 which involved a motor vehicle accident, the New York State Appellate Division, Fourth Department, reiterated this principle in reversing a trial court’s order compelling disclosure of statements the defendant provided to his insurance carrier regarding the accident. The plaintiff had moved for an order compelling the disclosure of the investigative statements the defendant made to his insurer. The trial court granted the motion and ordered the disclosure of the statements.
The defendant appealed, and the Fourth Department reversed, holding that the trial court erred in compelling the disclosure of the statements, which the appellate court held were conditionally protected from discovery. Further, the court held, the plaintiff had failed to demonstrate a “substantial need” for the statements or establish that he could not obtain equivalent materials without undue hardship.
This decision highlights the importance of practitioners exercising caution when responding to discovery demands for statements made by the insured to their insurer in conjunction with an accident or claim. Furthermore, the requesting party must demonstrate that there is a substantial need for the statements or that the statements cannot be obtained without undue hardship. Otherwise, these investigative statements should be protected from disclosure. Finally, it should be noted that the decision in Fusco did not address whether the same conditional protection would apply to investigative statements provided to the insurer by a plaintiff. Barclay Damon will continue to monitor for any future decisions addressing this issue.
If you have any questions regarding the content of this alert, please contact Earl Storrs, associate, at estorrs@barclaydamon.com; Tony Piazza or Mark Whitford, Insurance Coverage & Regulation Practice Area co-chairs, at apiazza@barclaydamon.com and mwhitford@barclaydamon.com; Matthew Larkin, Torts & Products Liability Defense Practice Area chair, at mlarkin@barclaydamon.com; or another member of the firm’s Insurance Coverage & Regulation or Torts & Products Liability Defense Practice Areas.
1Fusco v. Hansen, 2024 NY Slip Op 03262 (June 14, 2024).