As various other bloggers have noted, the Washington Post is reporting here that the insurance company for the Virginia Republican Party has issued subpoenas to find out where and why the money was supplied that paid for the settlement in the cellphone eavesdropping case.
The insurer's theory is that the party had no loss, if people gave them the money for the settlement. Is this a "collateral source" rule issue - meaning that the recovery from the insurer is not barred because of money received from other sources? Does the collateral source rule even apply in a contract case? Even if the donations are no bar to the recovery against the insurer, is the discovery still proper? The limits on discovery are not the same as the limits on relevant evidence at trial.
I don't know the answers, but I suspect there will be a hearing to find out. I also suspect that the insurer's counsel, whatever his legal theories, is not oblivious to the fact that discovery of this kind will generate publicity and pressure on the Republicans to abandon or settle their claim on the cheap, to get it out of the newspapers - which is their own fault for filing the stupid claim at this time, a decision which has yet to be explained.
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