The Travelers Indemnity Company of Connecticut v. Hudson Excess Insurance…

Background

This case concerns insurance coverage for Notias Construction, Inc. in an underlying personal-injury action. Travelers sought, among other things, a declaration that Hudson Excess Insurance Company and Steadfast Insurance Company had duties to defend Notias, along with reimbursement for defense costs Travelers had paid. Travelers estimated those costs at $48,866.11 as of December 13, 2024.

On September 26, 2025, District Judge Dale E. Ho granted Travelers’ summary judgment motion in part. He declared that Hudson had a duty to defend Notias, that Hudson’s coverage was primary, and that Travelers’ coverage was excess. He also declared that Steadfast had no duty to defend Notias. Judge Ho reserved the amount of damages because the record did not contain enough information to enter a money judgment and directed the parties to discuss that issue.

Travelers told Hudson that it had assembled defense bills and invoices and wanted a protective order before producing them. Travelers said the records could contain information protected by the attorney-client privilege, which generally protects confidential communications between a lawyer and client, and the work-product doctrine, which generally protects materials prepared for litigation. Travelers also raised a potential conflict because Hudson was already defending two other parties in the underlying action whose interests were adverse to Notias.

Hudson requested the defense billing and additional materials, including a rate and retention agreement, an outside-counsel billing policy, proof of Travelers’ payments, and audit recaps. Hudson argued that these materials were relevant to whether the defense fees and expenses were reasonable. Hudson opposed a protective order, in part because it said Hudson would need to review future bills when it took over Notias’s defense.

Hudson’s Motion to Compel

The court denied Hudson’s motion to compel discovery. Hudson relied on Federal Rule of Civil Procedure 37, which permits a motion to compel when a party has failed to respond to a formal document request under Rule 34. But Hudson had not served Travelers with a Rule 34 document request. Instead, Hudson had made an informal request in a letter. The court held that Rule 37 relief was unavailable because Hudson had not used the formal discovery procedure required for that motion.

The court also held that Hudson had not shown that the additional materials were relevant and proportional to the needs of the case, as required by Rule 26(b)(1). Hudson had previously acknowledged that the materials would be relevant only if Travelers had used outside counsel to defend Notias. Hudson did not show that outside counsel had been involved. The court therefore found that Hudson had not established that the additional materials were relevant to the remaining issues.

Travelers’ Motion for a Protective Order

The court granted Travelers’ motion in part. It explained that detailed billing records may contain privileged attorney-client communications or attorney work product, but billing rates and amounts, and records without detailed descriptions of legal services, are not necessarily privileged. Because Travelers had not provided enough information for the court to decide which portions of the defense billing were protected, the court did not determine that the records were privileged in their entirety.

Instead, the court found that a protective order would allow Travelers to identify potentially protected information document by document while allowing the damages dispute to proceed. The court also concluded that protection was needed from disclosure to Hudson personnel handling the defense of parties whose interests conflicted with Notias. The court found that Travelers’ proposed order was generally appropriate but needed changes, including provisions addressing attorney-client privilege and work product, partial-document designations, and the people who could receive confidential materials.

Order

The court ordered Travelers and Hudson’s counsel to meet promptly and negotiate a stipulated protective order based on Travelers’ proposal. They must submit either an agreed order or a joint letter identifying the points of disagreement and attaching competing language.

The court also ordered Travelers to produce its defense billing to Hudson’s counsel by November 25, 2025. Travelers must identify, by page or highlighted portion, the information it believed was confidential or privileged. Until a more detailed protective order was entered, the billing and other damages-related documents could be used only for this case and disclosed only to the receiving party’s counsel and assigned staff, or to the court with a sealing motion complying with the Southern District of New York’s rules.

After production, the parties had to meet and discuss the amount of damages. By December 9, 2025, they had to send Judge Ho a joint letter stating whether they had resolved the damages issue and, if not, proposing a process for resolving it. The final disposition was that Travelers’ motion for a protective order was granted in part, and Hudson’s motion to compel discovery was denied.