BAKER, C.J.
In 2004, an apartment explosion in Morgan County claimed the life of one individual and seriously injured several others. In 2005, the victims of the explosion filed a complaint against several defendants, including White-Rodgers, the company that had manufactured the gas control on the water heater in the residence where the explosion occurred. Unfortunately, this case has gotten mired in fervently-contested discovery disputes. The most recent is the subject of this interlocutory appeal and stems from the trial court’s decision to award attorneys’ fees as a discovery sanction against White-Rodgers for its failure to produce expert materials from a settled case in which White-Rodgers was also a defendant.
While White-Rodgers certainly consulted with experts in the prior case, these experts were never designated as experts who would testify at trial. Indeed, White-Rodgers settled the case before designating any expert witnesses. Accordingly, these experts were and remain nontestifying experts whose materials are protected from discovery by the Indiana Trial Rules. Consequently, White-Rodgers has produced all that it was required to produce under the trial court’s orders at issue herein, and we reverse the sanction’s order and remand for the continuation of the underlying litigation.
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Because White-Rodgers never designated any testifying experts, the Plaintiffs were required to show “exceptional circumstances under which it is impracticable for the party seeking discovery to obtain facts or opinions on the same subject by other means.” T.R. 26(B)(4)(b). Inasmuch as the Plaintiffs never argued that exceptional circumstances existed, White-Rodgers did not have to disclose its expert materials from Glascock.
Nevertheless, the Plaintiffs argue that pursuant to American Buildings, White-Rodgers was required to produce “documents from both testifying experts and consulting experts” once [the prior case] had settled. Appellee’s Br. p. 23. In American Buildings, this court held that expert-related materials from prior, terminated litigation are subject to discovery in later litigation after the litigation for which the experts were engaged has been resolved. 506 N.E.2d at 60. Initially, we observe that Reeves and Donnelly were decided after this court’s 1987 decision in American Buildings. And as discussed above, both Reeves and Donnelley stand for the proposition that a party’s designation of a testifying expert directly affects the discovery protection provided to that expert. Accordingly, to the extent that American Buildings holds that Rule 26(B)(4)(b)’s discovery protections do not extend to subsequent litigation, that holding is overly broad and was subsequently narrowed.
Moreover, to hold that Rule 26(B)(4)(b) discovery protections do not extend to subsequent litigation would chill the purposes of the discovery rules, which are to “provide parties with information essential to litigation of the issues, to eliminate surprise, and to promote settlement.” Nat’l Eng’g & Contracting Co., Inc., v. C & P Eng’g & Mfg. Co., Inc., 676 N.E.2d 372, 375 (Ind. Ct. App. 1997). Specifically, compelling a party to disclose materials from its nontestifying experts from prior litigation would have a detrimental impact on settlement that is two-fold. First, parties will be reluctant to consult with experts if they know that any expert with whom they consult will be discoverable in subsequent litigation. Indeed, parties will delay gathering information from experts for as long as possible even though this information would reveal the various strengths and weaknesses in a given case. Consequently, settlement will be delayed if it occurs at all. Additionally, parties will be reluctant to settle if they know that settlement will strip discovery protections from the materials produced by their nontestifying experts, thus clogging the courts with additional and perhaps unnecessary litigation.
Furthermore, the discovery protections provided to nontestifying experts by Rule 26(B)(4)(b) are based upon principles of fairness of not allowing one party to build its case on the resources and due diligence of another party.
FRIEDLANDER, J., concurs.
CRONE, J., dissents with opinion:
Turning to the merits of this case, I believe that White-Rodgers’s failure to comply with the discovery orders was not substantially justified in light of American Buildings Co. v. Kokomo Grain Co., 506 N.E.2d 56, which in my view should control the outcome of this case. Although American Buildings has been on the books and guided discovery proceedings in Indiana for nearly a quarter century, [footnote omitted] the majority gives it short shrift and criticizes its holding as “overly broad[.]” Slip op. at 15. I respectfully disagree.