Chartis Specialty Ins. Co. v. LaSalle Bank, et al.
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This action arose from a final arbitration award made in favor of defendant where plaintiff sought to vacate the award. At issue was whether the Arbitration Award should be filed under seal. Also at issue was whether the arbitrator concealed material information about past adversarial relationships with plaintiff-related entities amounting to evident partiality requiring the court to vacate the Arbitration Award. The court held that the existence of a confidentiality order did not necessarily require, without regard for whether it applied to the Arbitration Award or not, the sealing of the award. Rather, Court of Chancery Rule 5(g) controlled the treatment of that award and mandated that plaintiff show good cause as to why the Arbitration Award should be sealed. The court also held that because plaintiff was entitled to limited discovery into the arbitrator's alleged adversarial relationship with it, the court denied defendant's motion for a protective order and held in abeyance the entry of a scheduling order on motions for summary judgment.
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IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE CHARTIS SPECIALTY INSURANCE COMPANY (f/k/a American International Specialty Lines Insurance Company), an Illinois Company, Plaintiff, v. LASALLE BANK, NATIONAL ASSOCIATION, AS LOAN POOL TRUSTEE FOR EMAC OWNER TRUST 1998-1, a Delaware business trust, UNDER THAT CERTAIN LOAN POOL POOLING AND SERVICING AGREEMENT DATED AS OF JUNE 1, 1998, AS LOAN POOL TRUSTEE FOR EMAC OWNER TRUST 1999-1, a Delaware business trust, UNDER THAT CERTAIN LOAN POOL POOLING AND SERVICING AGREEMENT DATED AS OF MARCH 26, 1999, AS LOAN POOL TRUSTEE FOR EMAC OWNER TRUST 2000-1, a Delaware business trust, UNDER THAT CERTAIN LOAN POOL POOLING AND SERVICING AGREEMENT DATED AS OF FEBRUARY 1, 2000, Defendant. : : : : : : : : : : : : : : : : : : : : : : : : : : : : C.A. No. 6103-VCN MEMORANDUM OPINION Date Submitted: April 26, 2011 Date Decided: July 29, 2011 Barry M. Willoughby, Esquire, Martin S. Lessner, Esquire, and Michael Stafford, Esquire of Young Conaway Stargatt & Taylor, LLP, Wilmington, Delaware; Roger E. Warin, Esquire and Harry Lee, Esquire of Steptoe & Johnson, LLP, Washington, D.C.; and Scott Davis, Esquire of Gardere Wynne Sewell LLP, Dallas, Texas, Attorneys for Plaintiff. Kevin G. Abrams, Esquire and Nathan A. Cook, Esquire of Abrams & Bayliss LLP, Wilmington, Delaware; Tami Lyn Azorsky, Esquire of McKenna Long & Aldridge LLP, Washington, D.C.; and Barry J. Armstrong, Esquire of McKenna Long & Aldridge LLP, Atlanta, Georgia, Attorneys for Defendant. NOBLE, Vice Chancellor I. INTRODUCTION This action arises from a final arbitration award made in favor of Defendant .1 Plaintiff Chartis seeks to vacate that award. Because t are protected from disclosure by a [c]onfidentiality [o]rder that has been entered by the panel of arbitrators, according to Chartis that award 2 LaSalle challenges that contention in its motion for a determination that the Arbitration Award should not be filed under seal. Also raised at this juncture, among the grounds asserted in support of vacatur, Chartis alleges that concealed material information about past adversarial relationships with Chartis-related entities amounting to evident partiality requiring this Court to vacate the Arbitration Award.3 Chartis seeks discovery of Ennis and other third parties regarding his involvement in those past adversarial relationships. LaSalle has moved for a protective order prohibiting that discovery and for the entry of a scheduling order to permit the prompt filing and briefing of dispositive motions for summary judgment. 1 l Bank, N.A., American Arbitration Association No. 13-195-Y-000359- 06 2 Compl. ¶ 1 n.1. 3 Id. ¶ 2. 1 For the reasons set forth below, the Court concludes that the existence of a confidentiality order does not necessarily require applies to the Arbitration Award or not without regard for whether it the sealing of the award. Rather, Court of Chancery Rule 5(g) controls the treatment of that award and mandates that Chartis show good cause as to why the Arbitration Award should be sealed. In addition, because Chartis is entitled to limited discovery adversarial relationship with it, the Court will deny protective order and will hold in abeyance the entry of a scheduling order on motions for summary judgment. II. BACKGROUND Chartis, an Illinois corporation,4 is an eligible surplus lines insurer in Delaware. The arbitration proceeding considered purported breaches by Chartis of certain insurance policies that it had issued . LaSalle, an Illinois banking corporation, served as the trustee for Delaware business trusts5 that are the beneficial owners. The Policies allegedly contain arbitration agreements requiring the application of Delaware law.6 4 Although formerly known as American International Specialty Lines Insurance Company (an AIG member insurance company) convenience. 5 EMAC Owner Trust 1998-1, EMAC Owner Trust 1999-1, and EMAC Owner Trust 2000-1. Bank of America, N.A., the successor by merger to LaSalle, is the current trustee for these loan pools. 6 Compl. ¶ 9. 2 The Arbitration initiated by Chartis on February 8, 2006 was conducted A panel of three arbitrators was selected by the parties and included Ennis, W. Jerry Hoover, and Jay W. .7 During the Arbitration, a confidentiality order, Elston 8 was entered by the Arbitration Panel. Upon completion of years-long discovery, more than 60 days of evidentiary hearings were held, after which ngs on September 22, 2010. At some point during the Arbitration (but after the Arbitration Panel had been appointed), Chartis discovered that Ennis had served as general counsel and vice president of GenCorp, Inc. from 1986 to 1996. During his tenure with GenCorp contentious and unsuccessful multi-million dollar insurance coverage litigation against nine American International Group member insurance companies which are corporate affiliates of Chartis involving factual insurance coverage and environmental issues similar to those raised in the Arbitration.9 Because of this supposed, undisclosed adversarial relationship and its subsidiary Aerojet purportedly involving GenCorp Chartis requested that the AAA remove Ennis from the 7 Before the Arbitration Panel was installed, the parties maintained the unrestricted right to remove any prospective candidate from consideration. 8 9 Compl. ¶ 2. 3 Arbitration Panel. After reviewing supplemental disclosures made by Ennis, the AAA requests and reaffirmed appointment. The Arbitration Panel later issued the more than 250 page Arbitration Award, effective as of December 31, 2010. Chartis filed this action that same day to vacate the award under 9 U.S.C. § 10 and the 5th and 14th Amendments to the United States Constitution.10 The grounds asserted by Chartis in support of vacatur are as fo Chartis constitutes evident partiality; (2) the Arbitration Panel exceeded its powers ntractual arbitration agreement as set forth in the Policies; (3) the primary basis for the Arbitration Award is an insurance policy that was not at issue in the Arbitration, for which Chartis was deprived of the opportunity to present evidence; (4) the Arbitration Panel prejudiced Chartis by disregarding the applicable law; and (5) the Arbitration Panel ignored a statute of limitations defense raised by Chartis during the Arbitration.11 On January 31, 2011, LaSalle filed its answer and counterclaim to confirm the Arbitration Award under 9 U.S.C. § 9. 10 11 Id. ¶¶ 12-16, 24-25. See id. ¶¶ 2-6. 4 III. ANALYSIS A. Treatment of the Arbitration Award Based on its assertion in the Complaint that the Arbitration Award cites documents and testimony protected from disclosure by the Confidentiality Order, Chartis did not attach the award to its pleadings and is of the view that the award 12 LaSalle disputes that contention, arguing that the Arbitration Award is not deemed confidential by operation of the Confidentiality Order and that, in any event, references to exhibits and testimony in that award do not disclose confidential information.13 disclosure documents and testimony that it, and LaSalle, always understood and agreed would be protected by the Confidentiality Order 14 Because the Arbitration Award was generated in connection with the Arbitration, Chartis suggests that it falls within the scope of that order. Moreover, the Confidentiality Order remains effective even after the Arbitration has concluded, according to Chartis, such that the Arbitration Award should be kept private because it incorporates and relies upon confidential information. Chartis further contends 12 Id. ¶ 1 n.1. The Court ordered that LaSalle be permitted to file the Arbitration Award under seal pending the outcome of its motion for a determination that the award should be unsealed. See Chartis Specialty Ins. Co. v. LaSalle Bank, N.A., C.A. No. 6103-VCN (Del. Ch. Feb. 25, 2011) (ORDER) (Trans. ID No. 36153276). 13 14 5 that good cause exists for sealin law favors enforcement of confidentiality orders on which parties have relied; (2) it would be unjust to allow LaSalle to ignore the terms of the order; and (3) the 15 In response, LaSalle incorrect in its conclusion that the Arbitration Award cannot be made public. 16 More specifically, because the Confidenti designate as confidential only that Arbitration Award is not a Chartis document and, therefore, Chartis has no right to 17 Moreover, LaSalle asserts that because the Arbitration Panel never ordered that the Arbitration Award be treated as confidential, disclosure of that award is unrestricted. Although Chartis purports to demonstrate good cause for sealing the Arbitration Award, Chartis fails to make the necessary showing, according to LaSalle; bondholders [of the loan pools that beneficially own the Policies,] and the general 18 15 Id. ¶ 20. 16 ¶¶ 3, 10. Id. ¶ 12 (emphasis in original). 17 18 6 For that reason, LaSalle requests that the Court grant its motion and order that the Arbitration Award become part of the public record. including deposition transcripts and exhibits, answers to interrogatories and requests for admissions, and affidavits or certificates and exhibits thereto . . . filed default does not apply, however, where a party, seeking to file documents under seal, this Court specifying those documents or categories of documents which should be secrets, (2) third-party confidential material or (3) nonpublic financial 19 Rule 5(g) balances Delaware the tradition of open proceedings [ing] strict limits on parties ability to maintain filings 20 confidential, with the importance of keeping private proprietary, information . . . . 21 or commercially Thus, or constitutes personally sensitive private parties should not be 19 Romero v. Dowdell, 2006 WL 1229090, at *2 (Del. Ch. Apr. 28, 2006); see also In re Yahoo! ders Litig., 2008 WL 2268354, at *1 (Del. Ch. June 2, 2008). 20 Kronenberg v. Katz, 872 A.2d 568, 607 (Del. Ch. 2004). 21 Amalgamated Bank v. UICI, 2005 WL 1377432, at *6 (Del. Ch. June 2, 2005). 7 litigate in courts of public record behind a judicially enforced screen, 22 with limited exceptions. Turning to the specific issues raised here, the Court first considers whether the Arbitration Award cannot be made public because of the Confidentiality Order entered by the Arbitration Panel. Consistent with principles of comity, at least one Delaware court has refused to modify or to interpret a confidentiality order entered by a court of another jurisdiction.23 In this instance, however, Chartis seeks to utilize judicial resources to vacate an arbitration award while simultaneously claiming that the award should remain private because of a confidentiality order entered by a panel of arbitrators. Under these circumstances, the Court is not convinced that it should defer to the Confidentiality Order;24 rather, because the is at the heart of what the Court is asked to act upon, the part[y seeking to maintain confidentiality] must demonstrate why the presumption of access should be overcome. 25 Under Delaware law, that necessary showing requires Chartis to demonstrate good cause for why the Arbitration Award should be sealed. 22 Kronenberg, 872 A.2d at 608. See Monsanto Co. v. Aetna Cas. & Sur. Co., 1991 WL 35684, at *1 (Del. Ch. Mar. 13, 1991). 24 That is, assuming the Confidentiality Order even applies to the Arbitration Award, which is unclear. 25 Global Reinsurance Corp.-U.S. Branch v. Argonaut Ins. Co., 2008 WL 1805459, at *1 (S.D.N.Y. Apr. 21, 2008). There, the court stated that where a party seeks to confirm (and the public in the usual case has a right to know what the Court has done. Id. at *2. 23 8 Chartis argues that good cause exists for sealing the Arbitration Award 26 Chartis trade More specifically, Chartis contends that the award makes claims materials [which] constitute trade secrets, and/or confidential business information that should be kept under seal. 27 In response, LaSalle argues that riting testimony and documents nor the protected categories.28 Thus, Chartis has failed, according to LaSalle, to show e law against sealing 29 Although good cause may exist for sealing certain parts of the Arbitration Award that consist of competitively sensitive information, the award is not entirely comprised of private information. Accordingly, sealing the award in toto is not necessary and would improperly Moreover, because Chartis does not 26 27 o Unsealing ¶ 30. Id. ¶ 31 (citation omitted). 28 29 Id. ¶ 31. 9 identify specific portions of the award containing confidential information, the Court cannot determine whether redactions would be appropriate; that analysis 30 Thus, the Arbitration Award may be unsealed subject to Chartis first having an opportunity to confer with LaSalle regarding any proposed redactions it might have. If the parties cannot reach agreement, they may submit supplemental briefing as to why good cause does or does not exist for any disputed redactions.31 30 Espinoza v. Hewlett-Packard Co., 2011 WL 941464, at *6, *22 (Del. Ch. Mar. 17, 2011). Chartis also purports to show good cause in arguing that (1) sealing of the Arbitration Award is necessary because Chartis relied upon the Confidentiality Order to prevent disclosure of information from the Arbitration and, if the Arbitration Award is made public, Chartis may be prejudiced by its use in other ongoing litigation; and (2) assuming that the Confidentiality Order applies to the Arbitration Award, fairness dictates that it be filed under seal because LaSalle did 31 determination that the Confidentiality Order cannot be relied upon to demonstrate that the Arbitration Award should be sealed, Chartis must demonstrate some other good cause basis for the Court to override the default position of Rule 5(g) mandating public access. These additional grounds asserted by Chartis are not among those traditionally recognized by Delaware courts as meeting this burden; that is, they do not specifically raise concerns about disclosure of hird-party confidential materials, or private [,] . . . [a]ny documents or information that do not fit the above criteria, cannot harm the parties or third parties, or One Sky, Inc. v. Katz, 2005 WL 1300767, at *1 (Del. Ch. May 12, 2005). Under tween Chartis and a nonparty before this Court has confirmed or vacated it. Chartis ignores, however, that any court presented with the Arbitration Award would likely have knowledge of the ongoing proceedings here and would thus understand that the award may be vacated on one (or more) of the grounds articulated in the Complaint. For that reason, the risk of any harm to Chartis is at best minimal See Espinoza, 2011 WL 941464, at 10 B. Discovery Issues Although the AAA denied its earlier requests to remove Ennis from the 32 LaSalle contends that evidence of non-disclosure, hostile conduct, bias or lack of impartiality on the part 33 For that reason, LaSalle seeks a protective order to prevent Chartis from engaging in discovery of Ennis and other third parties related to his purported lack of impartiality. Because post-arbitration discovery is appropriate only if 34 Under that standard, suggests LaSalle, Chartis must articulate the harm he would suffer if it were unsealed, let alone that such harm would be l contentions raised by Chartis do not amount to good cause for purposes of overcoming the default position of public access under Rule 5(g). 32 33 Id. ¶ 8. 34 Scheduling Order ¶ 8 (quoting Midwest Generation EME, LLC v. Continuum Chem. Corp., 768 F. Supp. 2d 939, 943 (N.D. Ill. 2010)). 11 acted with meaningful impropriety 35 a showing that LaSalle argues has not been made. In -party subpoenas . . . demonstrate on their face that Chartis seeks information extremely relevant to one of the main issues in this -selection failure to disclose . . . litigation between his company and various AIG insurers requires that the [A]rbitration 36 For that reason, Chartis insists that information clearly discoverable under Court of Chancery Rule 26 and are narrowly tailored and directed only to the third parties that have the information 37 35 Id. ¶ 16 (quoting Midwest Generation, 768 F. Supp. 2d at 946). 36 -selection disclosures revealed that, at some point in the past, he had owned shares of AIG stock. Beyond that, he revealed no other conflict pertaining to AIG or its affiliates. Chartis, in its pre-selection disclosure checklist had listed some but not all of its related AIG member insurance companies to determine if any of the potential arbitrators had past dealings with those entities. It appears that that checklist did not include any of the AIG member insurance companies involved in litigation with GenCorp and its affiliates. For that reason, although Ennis disclosed his former employment as general counsel for GenCorp, he appears to have represented to Chartis that he had no conflicts based on that checklist. 37 Id. ¶ 2. A review of the third-party subpoenas and requested commissions reveals that Chartis, at this juncture, seeks only discovery in the form of the production of documents. Thus, addresses only the narrow question as to whether requests for the production of documents are appropriate in this instance. 12 Chartis further contends that LaSalle attempts ; however, a requirement of that sort standard of proof for issuing discovery than achieving vacatur based on evident 38 That standard which is contrary to Court of Chancery Rule 26 and has not been applied by any Delaware court does not govern here, according to Chartis. Under Court of Chancery Rule 26 far-reaching. 39 he scope of discovery . . . is broad and Subsection (b)(1) of that rule provides that discovery regarding any matter, not privileged, which is relevant to the subject matter involved in the pending renders discoverable appears reasonably calculated to lead to the discovery of admissible evidence 40 The Court, however, may limit discovery that is y burdensome or expensive, taking into account the needs of the case, the amount in controversy, limitations on 41 the parties squarely within the sound discretion of this 38 Id. ¶¶ 2, 12. Pfizer Inc. v. Warner-Lambert Co., 1999 WL 33236240, at *1 (Del. Ch. Dec. 8, 1999). 40 Ct. Ch. R. 26(b)(1). 41 Id. 39 13 Court. 42 Moreover, Rule 26(c) provides that the Court may, for good cause annoyance, embarrassment, oppression, or undue burden or expense . . . . 43 The parties are in apparent agreement that the Federal Arbitration Act (the 44 applies to the Arbitration Award. The Court has subject matter jurisdiction to vacate or to confirm the award under that Act.45 The Delaware 46 Uniform Arbitration Act (th mandates that the Court determine in conformity with the Federal Arbitration Act . . . , and such general principles of law and equity as are 47 Moreover, bec the other provisions of [the DUAA] are without standing and [this] case[] shall be 48 42 In re Tyson Foods, Inc., 2007 WL 2685011, at *1 (Del. Ch. Sept. 11, 2007) (citing Dann v. Chrysler Corp., 166 A.2d 431, 432 (Del. Ch. 1960)). For that reason, discovery may be limited or to ensure that the discovery sought is properly related to the issues presented in the litigation. Id. 43 Ct. Ch. R. 26(c). 44 9 U.S.C. §§ 1-16. 45 SBC Interactive, Inc. v. Corporate Media Partners, 1998 WL 749446, at *1 (Del. Ch. Oct. 7, isdiction over the enforcement, modification or vacating of an arbitration award rendered under the FAA. Neither the FAA nor the Delaware vacate arbitration 46 10 Del. C. §§ 5701-5725. 47 Id. § 5702(c). 48 Id. 14 unless the award is vacated, modified, or corrected as prescribed in Sections 10 and 11 of the FAA.49 A decision of the United States Supreme Court teaches these statutorily enumerated circumstances are the only circumstances under which a court may grant vacatur or modification under the FAA. 50 In accordance with there was evident partiality or corruption in the arbitrators, or either of them 51 Noting the lack of case law interpreting the evident partiality standard under the DUAA, the Court in Beebe Medical Center looked to applications of analogous language in the FAA and the Uniform Arbitration Act, from which the DUAA standard is derived.52 There, the Court observed has not been interpreted literally as requiring a showing of obvious bias for one party. Rather, the phrase has been read as reflecting a more general requirement that neutral arbitrators be impartial and unbiased. case law, according to Beebe Medical Center, instructs 49 53 The bulk of the an arbitrator s failure 9 U.S.C. § 9. TD Ameritrade, Inc. v. McLaughlin, Piven, Vogel Sec., Inc., 953 A.2d 726, 732 (Del. Ch. 2008) (citing Hall St. Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 586 (2008)). 51 9 U.S.C. § 10(a)(2). 52 See Beebe Med. Ctr., Inc. v. InSight Health Servs. Corp., 751 A.2d 426, 432 (Del. Ch. 1999). Compare 9 U.S.C. § 10(a)(2), with 10 Del. C. § 5714(a)(2). 53 Beebe Med. Ctr., 751 A.2d at 433. 50 15 to disclose a substantial relationship with a party or a party s attorney justifies vacatur under the evident partiality standard. 54 Because discovery is limited in actions challenging an arbitration award under the FAA,55 the ederal courts have been understandably hesitant to grant 56 The Ninth Circuit has should be handled pursuant to judicial supervision and limited to situations where clear evidence of impropriety has been presented. 57 Courts have interpreted Woods as teaching that, without clear evidence of impropriety, post-arbitration discovery of arbitrators is not allowed.58 The Sixth Circuit has addressed postarbitration discovery by considering, first, whether the party seeking discovery has 54 Id. at 434-35. In vacating an arbitration award in that action because of evident partiality, the Court noted that if an arbitrator does not disclose a relationship with a party . . . that creates a reasonable impression of bias, the party seeking vacatur should not bear the burden of demonstrating that the arbitrator was actually aware of that relationship. Id. at 438. 55 Midwest Generation Post-arbitration discovery is rare, and courts have been e 56 In re EquiMed, Inc. (EquiMed II), 2006 WL 1865011, at *6 (E.D. Pa. June 30, 2006); see also STMicroelectronics, N.V. v. Credit Suisse Sec. (USA) LLC, 2011 WL 2151008, at *5 (2d Cir. completeness of an arbitra 57 Woods v. Saturn Distribution Corp., 78 F.3d 424, 430 (9th Cir. 1996) (quoting Andros Compania Maritima, S.A. v. Marc Rich & Co., 579 F.2d 691, 702 (2d Cir. 1978)). In Woods, the Ninth Circuit al Id. (citing , 857 F.2d 742, 748 (11th Cir. 1988)). 58 See, e.g., Midwest Generation, 768 F. Supp. 2d at 943-44; Nationwide Mut. Ins. Co. v. Home Ins. Co., 90 F. Supp. 2d 893, 898-99 (S.D. Ohio 2000). 16 presented clear evidence of impropriety a more relaxed standard.59 Thus, implicitly it has declined to decide which standard is controlling.60 59 See Uhl v. Komatsu Forklift Co., Ltd. In Nationwide II, we were ambiguous as to whether the party seeking additional discovery must offer clear evidence of improper conduct or simply establish that a reasonable person would have to conclude that an arbitrator was partial, but we concluded that under either standard no additional discovery was warranted. . . . Here too, [the party seeking discovery] does not merit additional Nationwide Mut. Ins. Co. v. Home Ins. Co., 278 F.3d 621, 628-29 (6th Cir. 2002) (concluding that additional post-arbitration discovery into arbitrator bias was not warranted because the party seeking discovery had not demonstrated either clear evidence of improper conduct or that a reasonable person would have to conclude arbitrator partiality). 60 Chartis cites In re EquiMed, Inc. (EquiMed I), 2005 WL 2850373, at *2 & n.1 (E.D. Pa. Oct. 28, 2005), as analyzing a postnot evidence of past business relationships among an arbitrator and certain parties to an arbitration EquiMed I holds that evident partiality is established when arbitrators fail to disclose any relationships that Id. at *2 n.1 (quoting Crow Constr. Co. v. Jeffrey M. Brown Assoc. Inc., 264 F. Supp. 2d 217, 221 (E.D. Pa. 2003)). The Court later where a party alleges arbitrator bias. EquiMed II, 2006 WL 1865011, at *6. Although Chartis argues that EquiMed I rejected a clear evidence of impropriety standard, Midwest Generation, 768 F. Supp. 2d at 943-44, cites to that opinion in support of its determination that post-arbitration discovery of arbitrators is only permitted where the party seeking discovery has demonstrated clear evidence of impropriety. Ultimately, it is unclear what standard controlled the decision in EquiMed I to allow postarbitration discovery; the court offered little insight into the clear evidence of impropriety claim. In EquiMed II -arbitration discovery was seeming In addition to the case law discussed supra, these cases further illustrate the difficulties courts confront in articulating the governing standard for their decisions as to whether post-arbitration discovery will be allowed where arbitrator bias is alleged. 17 Based on the current record, Chartis has made a sufficient showing to justify limited post-arbitration discovery. Indeed, although post-arbitration discovery is rarely permitted, Chartis has offered evidence that adequately satisfies the various standards61 that courts have employed in determining whether to allow a party to take discovery of an arbitrator. Before he was empanelled, Ennis did not disclose that GenCorp he served as general counsel for which was involved in litigation with certain AIG companies during his tenure. During the Arbitration, on July 15, 2009, Ennis disclosed as follows: As previously disclosed, I recall that GenCorp filed two . . . lawsuits [against several primary and excess insurance companies involving environmental pollution] between about 1986 and 1994. . . . An Assistant General Counsel for GenCorp who reported to me had primary responsibility for direction of the lawsuits. . . . I do not recall now, the name of any insurance company that was a named defendant in either lawsuit. I did not read, review or approve of the complaints that were filed, nor did I read any answer or other response thereto. . . . .... I simply do not know whether [AIG] or any of its subsidiaries was a named defendant in any lawsuits filed by GenCorp or any of its subsidiaries. But I do know that I was not involved, as a lawyer or otherwise, in the identification or selection of any defendant, the preparation of any complaint, review of the facts, insurance policies or submissions by any party, or the direction, management or settlement of any lawsuit filed by GenCorp or any of its subsidiaries in respect of 61 For example, the record demonstrates that Chartis can, at this juncture, make colorable arguments in support of clear evidence of impropriety, a compelling justification for discovery, and a reasonable appearance of bias. 18 environmental pollution under a general liability or other type of insurance policy.62 In a supplemental November 2009 disclosure, Ennis reiterated that he had previously counsel and its involvement in environmental pollution insurance lawsuits. He it complained of had been dismissed or settled by the time Ennis had joined GenCorp, and another lawsuit involving Aerojet was managed by an internal legal team of that subsidiary .63 Thus, the totality of Ennis seemingly indicate that he either had no knowledge of or no involvement in the lawsuits raised by Chartis. The record, however, refutes that assertion. For example, in deposition testimony taken in an unrelated matter, Ennis was identified nt involved in insurance-related matters.64 Moreover, based on a privilege log from an insurance coverage lawsuit between GenCorp and an AIG member company, Ennis authored or received over twenty documents related to that litigation.65 Thus, because Chartis points to sufficient evidence to warrant limited and its 62 ¶¶ 1, 2, 5. 63 arbara Cook). 64 65 19 affiliates The third- party subpoenas issued by Chartis and the commissions it seeks represent permissible post-arbitration discovery disclosures and the limited record now before the Court. IV. CONCLUSION For the foregoing reasons, he Arbitration Award should not be filed under seal is granted consistent with the Court ruling supra. Its motion for a protective order prohibiting discovery and for the entry of a scheduling order to permit the prompt filing and briefing of motions for summary judgment is denied. Counsel are requested to confer and to submit an implementing form of order. 20
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