Butler v. Rigby

SARAH S. VANCE

American Medical Group ("AMG") and Midtown Health Care ("MHC") object to Magistrate Judge Chasez's ruling of February 20, 1998. For the reasons that follow, Magistrate Judge Chasez's order is affirmed in part, and reversed in part.

I. BACKGROUND

This lawsuit arises out of an automobile accident that occurred in April 1996. Plaintiffs to this lawsuit--Tonia Butler, Cynthia Butler, Doris Charles, Lori Malbroue, and Aaron Davallier--have sued James Rigsby, his employer, Dyess Sand & Gravel, Inc., and its insurer, Midland Risk Insurance Company. AMG and MHC are not parties to this lawsuit, but doctors from both groups provided medical treatment to all of the plaintiffs. Defendants filed identical notices of depositions on AMG and MHC, in which defendants requested certain documents and information. Pertinent to this motion, defendants asked for the following:

2) Any and all documents, computer printouts, records, charts, accounting records, tax records, canceled checks, written contracts, letters of guarantee, correspondence and any and all other tangible evidence which reflects:

a) A listing of the total number of patients treated at your facility which are involved in litigation since January 1992.

b) A listing of the total number of patients treated at your facility that have been referred to you by attorneys since January 1992.

c) A listing of the total number of patients/patient accounts for individuals referred to you by Evan Tolchinsky, . . . Jose Castro, and/or the Personal Injury Law Center.

d) Any and all records reflecting total income of your facility, and income of your facility relating to individuals referred to you by attorneys since 1992.

e) Any and all letters of guarantee or contracts with attorneys or law firms relating to individuals seen, treated, or examined at your facility since 1992.

Defs.' Opp., Exhs. A, B. AMG and MHC moved the Court for a protective order prohibiting defendants from discovering the information requested in 2(a)-(e) on the grounds that it is not relevant to the lawsuit, some of it is protected by the health care provider-patient privilege, and the request is overly burdensome. Magistrate Judge Chasez concluded that most of the information was discoverable. . . .

AMG and MHC object to the Magistrate Judge's ruling. They insist that the information is not relevant to the lawsuit, it is unduly burdensome to non-parties, and some of the information is privileged. The court rules as follows.

II. DISCUSSION

A. Standard of Review

A magistrate judge may hear and determine any pretrial matter, with limited exceptions, pending before the Court. . . . A magistrate judge's decision on a non-dispositive matter is reviewed by a district court on a clearly erroneous or contrary to law basis. . . . A magistrate judge's decision is clearly erroneous when, based on the entire evidence, the reviewing court is left "with the definite and firm conviction that a mistake has been committed."

B. Scope of Discovery in General

The Federal Rules contemplate liberal discovery and provide for a flexible treatment of relevance. Under Rule 26(b)(1) of the Federal Rules of Civil Procedure, the scope of discovery includes any matter, not privileged, that is relevant to the subject matter involved in the pending action. The range of relevant matters is broad and may be related to "the claim or defense of the party seeking discovery or to the claim or defense of any other party, including the existence, description, nature, custody, condition, and location of any books, documents, or other tangible things and the identity and location of persons having knowledge of any discoverable matter." Fed. R. Civ. P. 26(b)(1). The rules make clear that the discovery need not be admissible at trial "if the information sought appears reasonably calculated to lead to the discovery of admissible evidence." . . .

Discovery may be limited by the court if it determines that "the discovery sought is unreasonably cumulative or duplicative." Fed. R. Civ. P. 26(b)(2). The court may also restrict discovery if it concludes that "the burden or expense of the proposed discovery outweighs its likely benefit, taking into account the needs of the case, the amount in controversy, the parties resources, the importance of the issues at stake in the litigation, and the importance of the proposed discovery in resolving the issues." Id. Further, the federal rules provide that the court "may make any order which justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense." Fed. R. Civ. P. 26(c).

C. The Discovery in Dispute

1. A listing of the total number of patients referred to AMG and/or MHC by Castro, Tolchinsky, and/or the PILC.

AMG and MHC argue that this information has no relevance to plaintiffs' lawsuit, and the request is unduly burdensome. Defendants contend that they seek this information in order to show that the medical groups receive substantial income from the attorneys who initially represented the plaintiffs in this matter, and they argue that such evidence is relevant to show potential bias.

Magistrate Judge Chasez's conclusion that the sought after information was discoverable was not contrary to law. Evidence of a special relationship between an expert witness and legal counsel is relevant to demonstrate the possible bias of the expert witness, and discovery that is reasonably calculated to lead to such evidence should be permitted. . . . Similarly, an expert witness' experiences in prior lawsuits is relevant to demonstrate possible biases. . . . Thus, it was not contrary to law for Magistrate Judge Chasez to permit discovery into the total number of patients referred to AMG and/or MHC by Castro, Tolchinsky, and/or the PILC, particularly since these lawyers initially represented the plaintiffs in this matter.

Further, it was not clearly erroneous for Magistrate Judge Chasez to conclude that the expense or burden of producing this information did not outweigh its likely benefits. Although AMG and MHC continue to assert that the request is unduly burdensome, Magistrate Judge Chasez concluded otherwise, and it does not appear to this Court that a mistake has been committed. Indeed, in defendants' memorandum in support of their motion for contempt, they illustrated that the medical groups' records are tailored for litigation-related services and that each attorney is assigned an account number. This suggests that the medical groups can collate the records by the name of the attorney. However, in light of the medical groups' concerns of time and expense and the sworn affidavit that states that compiling the requested information would require that each individual chart be manually pulled and reviewed, the Court orders that defendants shall pay one-half the costs associated with composing the list of the total number of patients referred to AMG/MHC by Castro, Tolchinsky, and/or the PILC between July 1, 1995 and June 30, 1996.

2. The net income of the entities; and the percentage of net income that it litigation-related.

Allowing the discovery of this information was neither contrary to law nor clearly erroneous. The courts have held that the amount of income derived from services related to testifying as an expert witness is relevant to show bias or financial interest. . . . Contrary to the medical groups' assertions, the relevance of the groups' net income is not dependent upon a showing that the plaintiffs' medical treatment was not reasonable, necessary, or in compliance with the appropriate standards for medical treatment. Indeed, "discovery is commonly allowed in which the discovering party seeks information with which to impeach witnesses for the opposition." . . .

Thus, it was not a mistake for Magistrate Judge Chasez to permit inquiry into both the net income of the medical groups and the percentage of the net income that is related to litigation. Moreover, Magistrate Judge Chasez provided that counsel could move for such information to be sealed so as to limit any prejudice against the medical groups.

3. A computer printout of AMG's and MHC's current patients.

Magistrate Judge Chasez ordered that the medical groups are to provide defendants with a computer printout listing their current patients as well as any patient lists that were previously generated. AMG and MHC insist that lists of their current or past patients are privileged from discovery. . . . The Court agrees and concludes that the magistrate judge's ruling was contrary to law.

Rule 501 of the Federal Rules of Evidence provides that "in civil actions or proceedings, with respect to an element of a claim or defense as to which State law supplies the rule of decision, the privilege of a witness, person, government, State, or political subdivision thereof shall be determined in accordance with State law." Although the Advisory Committee anticipated some confusion as to whether State law or Federal law would supply the rule of privilege when the parties sought to prove something other than "an element of a claim or defense," it is generally accepted that "it makes no difference whether the supposedly privileged matter is direct or circumstantial evidence of a state claim," and "if it is in a line of proof that culminates in an element of a state claim or defense, then state rules of privilege apply." . . .

Jurisdiction over this lawsuit is based on diversity, and the medical groups are likely to testify as to a state claim, perhaps the extent of plaintiffs' injuries or damages. Accordingly, pursuant to Rule 501 of the Federal Rules of Evidence, state law supplies the rule of privilege in this case. Louisiana Revised Statute 13:3734(B) provides that in civil proceedings, "testimonial privileges, exceptions, and waiver with respect to communications between a health care provider and his patient are governed by the Louisiana Code of Evidence." . . . In turn, the Louisiana Code of Evidence sets forth the general rule of privilege:

[A] patient has a privilege to refuse to disclose and to prevent another person from disclosing a confidential communication made for the purpose of advice, diagnosis or treatment of his health condition between or among himself or his representative, his health care provider, or their representatives.

The Code states that "confidential communication" includes
any information, substance, or tangible object, obtained incidental to the communication process and any opinion formed as a result of the consultation, examination, or interview and also includes medical and hospital records made by health care providers and their representatives. . . .

In this case, and under these standards, the medical groups claim that lists of their current and/or past patients qualifies as privileged material. It is true that Louisiana courts have broadly interpreted the scope of the health care provider-patient privilege. The First Circuit Court of Appeal has concluded that "when an individual walks into a doctor's office and opens his mouth, that everything spilling out of it, whether it be his identity or his false teeth . . ., is presumptively privileged and beyond the reach of discovery."

In light of this precedent, the Court concludes that the AMG/MHC lists of current and/or past patients is privileged, and the information is therefore not discoverable. Moreover, this Court does not see how the identity of these patients could be relevant to this litigation in any event. Magistrate Judge Chasez's order compelling AMG and MHC to disclose their patient lists was contrary to law, and it is reversed.

For all of the foregoing reasons, IT IS ORDERED that Magistrate Judge Chasez's ruling of February 20, 1998 is affirmed in part, and reversed in part, in accordance with the Court's conclusions as set forth above.