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Soo Line Railroad Co. v. Travelers Indemnity Co.

United States District Court, D. Minnesota

May 30, 2019

Soo Line Railroad Company, doing business as Canadian Pacific, Plaintiff/Counter Defendant,
v.
The Travelers Indemnity Company, Defendant/Third-Party Plaintiff/Counter Defendant,
v.
Continental Insurance Company, as successor in interest to certain policies issued by Harbor Insurance Company, Third-Party Defendant/Counter Claimant.

          Arthur G. Boylan, Joseph W. Anthony, and Norman H. Pentelovitch, Anthony Ostlund Baer & Louwagie PA, 90 South Seventh Street, Suite 3600, Minneapolis, MN 55402 (for Soo Line Railroad Company)

          Amy J. Woodworth, Meagher & Geer, PLLP, 33 South Sixth Street, Suite 4400, Minneapolis, MN 55402; Craig Russell Blackman and Samuel J. Arena, Jr., Stradley Ronon Stevens & Young, LLP, 2005 Market Street, Suite 2600, Philadelphia, PA 19103; and William T. Mandia, I, Stradley Ronon Stevens & Young, LLP, 457 Haddonfield Road, Suite 100, Cherry Hill, N.J. 08002 (for The Travelers Indemnity Company); and Andrea E. Reisbord and Janine M. Loetscher, Bassford Remele, 100 South Fifth Street, Suite 1500, Minneapolis, MN 55402 (for Continental Insurance Company).

          ORDER

          Tony N. Leung United States Magistrate Judge

         This matter comes before the Court on The Travelers Indemnity Company's (“Travelers”) Motion to Compel Discovery and to Extend Case Deadlines (ECF No. 39). A hearing was held on April 10, 2019. Arthur G. Boylan and Norman H. Pentelovitch appeared on behalf of Soo Line Railroad Company (“Soo Line”). William T. Mandia, I, and Amy J. Woodworth appeared on behalf of Travelers. Andrea E. Reisbord appeared on behalf of Continental Insurance Company (“Continental”).

         I. BACKGROUND

         This is an insurance coverage dispute regarding environmental contamination in connection with certain property known as the Shoreham Yard, located in Minneapolis, Minnesota, which “has been operated as a railyard since the late 1880s.” (Compl. ¶ 3, ECF No. 1-1.) As alleged in the Complaint, “[a]ccidental, repeated, and continuous spills and leaks, which occurred in the course of the historical operations at [the] Shoreham Yard, have resulted in soil and groundwater contamination both on and off site.” (Compl. ¶ 3; see Compl. ¶¶ 30-34.) “Contaminated groundwater plumes currently extend nearly two miles off-site from the east side of the property and more than a mile off site from the west.” (Compl. ¶ 3; see Compl. ¶.)

         Soo Line alleges that, as of December 31, 2016, it has “paid approximately $50 million” in losses and legal expenses in connection with third-party property damage. (Comp. ¶ 5; see Compl. ¶¶ 37-38.) Soo Line “expects to spend tens of millions more . . . in the years to come.” (Compl. ¶ 5; see Compl. ¶ 38.) Soo Line alleges that Travelers is obligated to indemnify it for “Travelers'[s] proportionate share” of these losses and legal expenses under two policies issued by Travelers in or around the late 1960s and early 1970s. (Compl. ¶ 43; see Compl. ¶¶ 6, 16-19, 46-51.) Travelers has brought in Continental, contending that Continental is liable to Soo Line for part of the coverage period at issue under another policy issued to Soo Line in the early 1970s. (See generally Third Party Compl., ECF No. 13.)

         II. ANAYSIS

         Travelers brings the instant motion, taking issue with certain of Soo Line's discovery responses and seeking to extend the deadlines in the Pretrial Scheduling Order (ECF No. 20).[1]

         A. Discovery Disputes

         1. Legal Standard

         In general, “[p]arties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case . . . .” Fed.R.Civ.P. 26(b)(1). “Information within this scope of discovery need not be admissible in evidence to be discoverable.” Id. “Relevance is construed broadly at the discovery stage.” Heilman v. Waldron, 287 F.R.D. 467, 473 (D. Minn. 2012). Nonetheless, some threshold showing is necessary “before parties are required to open wide the doors of discovery and to produce a variety of information which does not reasonably bear upon the issues in the case.” Hofer v. Mack Trucks, Inc., 981 F.2d 377, 380 (8th Cir. 1992). Under Rule 37, “[a] party seeking discovery may move for an order compelling an answer, designation, production, or inspection.” Fed.R.Civ.P. 37(a)(3)(B). This Court “has considerable discretion in granting or denying discovery requests.” Bredemus v. Int'l Paper Co., 252 F.R.D. 529, 534 (D. Minn. 2008).

         2. Interrogatory Nos. 5 and 7

          Interrogatory Nos. 5 and 7 seek information regarding legal expenses and related costs incurred by Soo Line as well as an estimate of future costs Soo Line anticipates it will incur in connection with environmental contamination at the Shoreham Yard.

         Shortly before Travelers filed this motion, the parties met and conferred and Soo Line agreed to supplement its responses to these interrogatories. (Travelers's Mem. in Supp. at 10, 14 n.3, ECF No. 41; Soo Line's Mem. in Opp'n at 11, ECF No. 46.) At the hearing, the parties largely agreed that this dispute was resolved except for Travelers's concerns regarding ongoing production and the resultant impact on existing deadlines in this matter.

         The Court will take up the issue of scheduling in Section II.B infra. Otherwise, the Court concludes that any dispute as to Soo Line's responses to Interrogatory Nos. 5 and 7 is premature and Travelers's motion is denied without prejudice with respect to Interrogatory Nos. 5 and 7.

         3. Interrogatory No. 10

          Interrogatory No. 10 requests information related to certain statements made in regulatory filings by Canadian Pacific Railway Ltd., Soo Line's parent company:

Identify all Persons that participated in the drafting of statements regarding environmental liability and/or damages at the Site contained in Canadian Pacific Railway Ltd.'s 10K Annual Statements in 2016 and 2017 and/or 10Q Quarterly Statements in 2016, 2017, 2018, and Identify all schedules ...

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