Note: This post is by Chip Merlin and guest blogger Bob Rutter, an Ohio policyholder attorney, co-founder of Rutter & Russin, and nationally recognized leader in insurance coverage law, with 35 years of experience fighting insurance companies on behalf of policyholders.
For 25 years, Ohio has had a policyholder-friendly discovery rule in insurance bad faith cases. No more. Eddy v. Farmers Property Casualty Insurance Company 1 held that the bad faith discovery rules established in Boone v. Vanliner Insurance Company 2 no longer apply.
Boone held that in a bad faith case, “the insured is entitled to discover claims file materials containing attorney-client communications related to the issue of coverage that were created prior to the denial of coverage.”
Boone’s rationale was that “claims file materials that show an insurer’s lack of good faith in denying coverage are unworthy of protection.”
Eddy did not overrule Boone, but held that its holding, which was based on Ohio common law, was superseded by Ohio statutory law with the passage in 2007 of R.C. §2317.02, which states that an attorney:
[S]hall not testify . . . concerning a communication made to the attorney by a client in that relationship or the attorney’s advice to a client, except that if the client is an insurance company, the attorney may be compelled to testify, subject to an in camera inspection by a court, about communications made by the client to the attorney or by the attorney to the client that are related to the attorney’s aiding or furthering an ongoing or future commission of bad faith by the client if the party seeking disclosure of the communication has made a prima-facie showing of bad faith, fraud, or criminal misconduct by the client.
Since 2007, there have been numerous state and federal decisions in Ohio dealing with the issue of whether this statute overruled or superseded Boone, with a clear majority holding that it did not, because the statute only dealt with the testimony of an attorney, and Boone dealt with the production of documents.
In most situations, the Ohio Supreme Court has emphasized that it applies the plain meaning of a statute, a contract, or an insurance policy, and does not seek to judicially expand the plain words of the document.
Here, however, the court held that “testimony” included document production: “The current language of R.C. 2317.02(A)(2) confirms our long-held understanding that the statutory privilege applies both to documentary evidence and trial and deposition testimony.”
Eddy held that “Attorney-client communications are subject to discovery only upon a prima facie showing of bad faith, and only to the extent that the court, upon an in camera inspection, determines that the communications ‘are related to the attorney’s aiding or furthering an ongoing or future commission of bad faith by the client.’ R.C. 2317.02(A)(2).”
Eddy also held that Boone did not expressly control the discovery of work-product documents even though Boone stated in its opinion—but not in its syllabus—that the work product privilege does not apply to documents in the claim file that pre-date the denial since “At that stage of the claims handling, the claim file materials will not contain work product, i.e., things prepared in anticipation of litigation, because at that point it has not yet been determined whether coverage exists.”
Eddy reversed and remanded the case back to the trial court to determine if the Eddys have made a prima facie showing of bad faith, fraud, or criminal misconduct. If they have not done so, the attorney-client discovery stops. If they have done so, then the trial court conducts an in camera review of the attorney-client communications to determine whether the documents are related to the attorney’s aiding or furthering an ongoing or future commission of bad faith by the client. The work product documents are presumptively shielded from disclosure unless the Eddys make a showing of good cause therefor under Civ. R. 26(B)(4).
We can expect litigation in the future on what constitutes a prima facie showing of lack of good faith, which simply means acting without reasonable justification. Does a prima facie showing mean producing some evidence of lack of good faith, or does it require the degree of proof necessary to defeat summary judgment? Or does it mean something else?
And what constitutes an attorney aiding or furthering an act of bad faith? Take what is usually espoused as a classic case of bad faith. If the attorney advises the insurer that a claim is probably covered and should be paid, but the insurer declines to follow this advice and denies the claim, has the attorney aided or furthered the client in the commission of bad faith?
And will insurers now go back to “the good old days” and assert a work product privilege for all claim file materials based on the insurer’s position that all claims could potentially lead to litigation, so all materials in a claim file are prepared in anticipation of litigation?
Eddy answered some questions, but created a new batch.
1 Eddy v. Farmers Property Cas. Ins. Co., Slip Opinion No. 2026-Ohio-626 (Ohio Feb. 26, 2026).
2 Boone v. Vanliner Ins. Co., 91 Ohio St.3d 209 (Ohio 2001).