13 Fla. L. Weekly Supp. 571a
Insurance — Personal injury protection — Discovery — Appeals — Certiorari — Pre-trial discovery order compelling better response to medical provider’s request to produce claims handling and training materials provided to PIP adjusters is reviewable by petition for writ of certiorari where order departed from essential requirements of law and would cause material injury to insurer throughout proceedings, leaving no adequate remedy on appeal — Privilege — Trade secret — Trial court departed from essential requirements of law when it compelled production of materials without addressing asserted trade secret privilege and conducting in camera review of materials — Relevance — Where underlying action is only PIP claim without claim for bad faith action, requested claim files, manuals, guidelines and documents concerning claims handling procedures are irrelevant and/or privileged work product — Waiver — Insurer did not waive any privileges where insurer raised objections based on relevance and work product prior to motion to compel hearing and asserted sufficiently specific objection based on trade secret privilege in response to provider’s third request to produce
PROGRESSIVE EXPRESS INSURANCE COMPANY, a corporation authorized and doing business in the State of Florida, Petitioner, v. LOUIS CURREN, SR., as parent and natural legal guardian of LOUIS CURREN, JR., Respondent. Circuit Court, 18th Judicial Circuit (Appellate) in and for Seminole County. Case No. 04-73-AP. July 12, 2005. Counsel: Michael C. Clarke and Betsy Gallagher, Kubicki Draper, Tampa. Lee M. Jacobson, Law Offices of Michael B. Brehne, P.A., Maitland. Order Granting Petition for Writ of Certiorariand Denying Respondent’s Motion to Dismiss
(NANCY F. ALLEY, J.) Petitioner requests this Court to review and quash the County Court’s Order on Plaintiff’s Motion to Compel Better Responses to Third Request to Produce. We have jurisdiction. Fla. R. App. P. 9.030(c)(2). This Court grants the Petition, quashes the order, and remands this cause to the County Court for proceedings consistent with this Order.
FACTUAL AND PROCEDURAL BACKGROUND
Petitioner is the defendant in a first-party breach of contract action for personal injury protection (“PIP”) benefits pending in the County Court of Seminole County. Respondent is the parent and natural legal guardian of Petitioner’s insured seeking payment of first-party benefits. In the County Court, Respondent is the Plaintiff in the breach of contract suit for PIP benefits.
On March 1, 2004, Respondent/Plaintiff deposed Mr. Greg Hemmann (“Hemmann”), a medical claims representative of Petitioner/Defendant. During that deposition, Respondent’s/Plaintiff’s counsel and Hemmann shared, in part, the following exchange:
Q: What are the bases, or basis, for denial of this bill?
A: I mean, there’s more than just the IME that makes up the decision on a cutoff.
Q: When you said that there’s more than just IME cutoff; what are you talking about?
A: Well, basically, when you get the IME report, the recommendation of the IME doctor isn’t always the end-all, be all of the decision on how benefits are going to be handled. That’s one of the bases that go into it, but it’s not the sole factor involved.
Q: What are some of the other factors?
A: For example, [type of injury], whether it’s soft tissue or not; length of treatment post accident; whether it’s a low impact accident. There’s a few different ones that go into all the decisions.
Q: Do you have a list of those factors somewhere?
A: No, not specifically. It’s just claim handling experience.
Q: Did you learn these factors through a seminar or just day-to-day handling of claims?
A: Probably a little of both.
. . .
Q: This list that you just talked about, is there a list of these factors written down anywhere, maybe in training materials or —
A: Yeah, probably in training material, I would imagine.
Q: Do you have that list with you?
A: I don’t have anything from my initial training left over.
Q: Can you recall if this is the list that would be in your initial training, or was it subsequent training?
A: It’s kind of more of an initial claim handling, something we go over. It’s not something I deal with on a everyday basis, other than the way I handle my claims now.
Q: More than likely, it’s in the material that was given to you when you were in Cleveland?
A: I would imagine.
Hemmann Deposition, March 1, 2004, 28:16-25, 29:1-19; 35:4-21, in part (emphasis added).
Following this deposition, Respondent/Plaintiff filed his Request for Admissions asking Petitioner/Defendant to admit that Petitioner/Defendant provided leaflets, brochures, memoranda, correspondence, policies, and manuals, “to newly hired adjusters to aid in training the newly hired adjusters setting forth procedures, comments, comments, suggestions, guidelines or criteria for the handling, adjusting, or settling of all PIP claims.” Plaintiff’s Request for Admissions to Defendant, ¶¶6-11. Petitioner/Defendant objected on grounds of vagueness/ambiguousness, preserved its objections, and admitted that written materials are given to newly hired PIP adjusters. Defendant’s Response to Plaintiff’s First Request for Admissions, ¶¶6-11. Further, Respondent/Plaintiff asked, “Admit that written documentation is provided to newly hired adjusters, at their initial training in Cleveland, that instructs and aids the newly hired adjuster in adjusting PIP claims.” Plaintiff’s Request for Admissions to Defendant, ¶12. Petitioner/Defendant admitted this.
Then, Respondent/Plaintiff filed Plaintiff’s Third Request to Produce to Defendant, requesting:
1. Copies of all written materials that are given to newly hired PIP adjusters that Defendant admits are provided to newly hired PIP adjusters in Defendant’s Response to Plaintiff’s First Request for Admissions.
2. Copies of any written material given to Defendant’s adjusters that lists the factors in determining why, how and when to request the Defendant’s insured to submit to an independent medical examination.
Petitioner/Defendant responded to both of these requests, stating:
Defendant objects to Request to Produce Number[s] [1 & 2] as vague, ambiguous, overbroad, unduly burdensome, and designated merely to harass this Defendant. This request calls for information not relevant nor reasonably calculated to lead to the discovery of admissible evidence. This request also calls for documents protected by the work product, attorney-client and/or trade-secrets privileges. In order to comply with Rule 1.280(5), Florida Rules of Civil Procedure, Defendant states the documents being withheld as work product, attorney-client and/or trade-secrets privileged are any and written materials given to newly hired PIP adjusters.
Defendant’s Response to Plaintiff’s Third Request to Produce, ¶¶1-2.
Following this, on May 24, 2004, Respondent/Plaintiff filed Plaintiff’s Motion to Compel Better Responses to Third Request to Produce. As a result, on July 12, 2004, the County Court held a hearing on the matter. At the hearing, the County Court heard testimony regarding the Hemmann deposition. Subsequently, the County Court entered an order, on July 19, 2004, requiring production by August 2, 2004. Then, on July 22, 2004, Petitioner/Defendant filed a Motion for Rehearing and/or Motion to Set Aside/Vacate or Amend Order Granting Plaintiff’s Motion to Compel Better Responses to Its Third Request to Produce, arguing that the materials requested are: irrelevant, not reasonably calculated to lead to discovery of admissible evidence, work product, and/or trade secrets proprietary privileged documents. In that same motion, the Petitioner/Defendant also requested the County Court to issue a protective order for trade-secret and other materials not be disclosed or disclosed only in a designated way. On July 30, 2004, the County Court denied Petitioner’s/Defendant’s motion.
On August 6, 2004, Petitioner filed this Petition for Writ of Certiorari. On January 24, 2005, Respondent filed his Response to Petition for Writ of Certiorari and Motion to Dismiss Petition for Writ of Certiorari. On February 25, 2005, Petitioner filed a Reply to Respondent’s Response.
STANDARD OF REVIEW
A non-final order for which no appeal is provided by statute is reviewable by petition for certiorari only in limited circumstances. Martin-Johnson, Inc. v. Savage, 509 So. 2d 1097, 1099 (Fla. 1987). “The order must depart from the essential requirements of law and thus cause material injury to the petitioner throughout the remainder of the proceedings below, effectively leaving no adequate remedy on appeal.” Id. (citations omitted). This standard of review is applicable in considering the grant of certiorari relief in pretrial discovery. Allstate Insurance v. Boecher, 733 So. 2d 993, 999-00 (Fla. 1999).
DISCUSSION
This Court agrees with Petitioner that the County Court’s order compelling production, regarding Plaintiff’s Third Request to Produce, departed from the essential requirements of law and would cause material injury to Petitioner throughout the remainder of the proceedings below, leaving no adequate remedy on appeal.Trade-Secret Documents
Petitioner contends that the claims handling and training materials provided to adjusters during initial training are trade secrets.
When trade secret privilege is asserted as the basis for resisting production, the trial court must determine whether the requested production constitutes a trade secret; if so, the court must require the party seeking production to show reasonable necessity for the requested materials. The burden is on the party resisting discovery to show “good cause” for protecting or limiting discovery by demonstrating that the information sought is a trade secret or confidential business information and that disclosure may be harmful. (citations omitted) If production is then ordered, the court must set forth its findings. (citation omitted).
. . .
This determination will usually require that the trial court conduct an in camera inspection of the materials in question to determine whether they contain trade secrets.
American Express Travel Related Services, Inc. v. Cruz, 761 So. 2d 1206, 1208-09 (Fla. 4th DCA 2000). See also Salick Health Care, Inc. v. Spunberg, 722 So. 2d 944 (Fla. 4th DCA 1998) (finding trial court departed from the essential requirements of law when it compelled production of documents alleged to be proprietary and confidential trade secret information without first conducting an in camera hearing and inspection and failing to make specific findings of fact concerning the trade secret objections). See also Kavanaugh v. Stump, 592 So. 2d 1231, 1232 (Fla. 5th DCA 1992) (finding trial court departed from the essential requirements of law when it compelled production of documents without first conducting an in camera inspection).
Here, in response to Plaintiff’s Third Request to Produce, Petitioner objected, citing numerous privileges, including the trade-secret privilege. The County Court addressed trade-secret as it related to other issues, but never addressed trade-secret privileges as they relate to the information requested in the Third Request to Produce. See Pet. Appendix Tab 13, pp. 4-11; See Pet. Appendix Tab 13, pp. 11-16). Also, the County Court did not conduct an in camera review to address the trade-secret objections Petitioner raised in its response to the Third Request to Produce, even though the objection was raised prior to the hearing in the County Court, on July 12, 2004. See Defendant’s Response to Plaintiff’s Third Request to Produce, ¶¶1-2. The County Court must conduct an in camera review of alleged trade-secret materials to determine whether the material contains trade secrets.Relevant/Irrelevant Materials
It is important to note that Respondent’s underlying action is only a claim for PIP benefits. “The issues in such a claim are simply what benefits were due and whether [the insurance company] timely paid them.” Nationwide Mutual Fire Insurance Co. v. Augustine v. Joseph, M.D., P.A., 10 Fla. L. Weekly Supp. 379a (Fla. 9th Cir. Ct. (Appellate) March 3, 2003) (persuasive authority). “The reasons or motivations, financial or otherwise, for an insurer’s actions are simply not relevant to a claim for insurance benefits, which is what is at issue here.” Id. In this case, we have a similar situation. Respondent has no pending claim for a bad-faith action.
Respondent’s/Plaintiff’s Third Request to Produce requires the production of an expansive array of materials. Paragraph 1 asks for “all written materials . . . given to newly hired PIP adjusters.” Paragraph 2 asks for “any written material given to Defendant’s adjusters.” To the extent that Paragraphs 1 and/or 2 require production of Respondent’s claim files, manuals, guidelines, and documents concerning its claim handling procedures, these materials are irrelevant and/or privileged work product to the first-party dispute involved in this case. See State Farm Fire and Casualty Co. v. Valido, 662 So. 2d 1012 (Fla. 3d DCA 1995). See also State Farm Florida Insurance Co. v. Gallmon, 835 So. 2d 389 (Fla. 2d DCA 2003) (quashing an order requiring insurance company to produce its “claim files, investigative reports, adjuster notes, underwriting files, company policies and manuals, training materials, certain personnel files, sales brochures and marketing materials, . . . casualty claims manual and estimating manual,” and finding that those materials are either irrelevant to the first-party dispute or are privileged work product).
Here, Respondent’s/Plaintiff’s request includes, but is not limited to, these types of irrelevant/privileged company training-type materials. Petitioner should not be compelled to produce materials to the extent that these materials exist.Waiver of Privilege
This Court, from the record, does not find that Petitioner waived any privileges. Rule 1.280(b)(1) sets forth the scope of permissible discovery: “Parties may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter of the pending action . . . .” Fla. R. Civ. P. 1.280(b)(1). Further, as opposed to a situation in which a party waives a privilege by not timely objecting to requests within the scope of discovery, a party is not barred from asserting an untimely objection as to privilege for matters outside the scope of permissible discovery. Insurance Company of North America v. Noya, 398 So. 2d 836, 837-38 (Fla. 5th DCA 1981). Further, a party may obtain discovery of documents under Rule 1.280(b)(1) and prepared in anticipation of litigation only upon a showing that the party seeking discovery has need of the materials and is unable without undue hardship to obtain the substantial equivalent of the materials by other means. Fla. R. Civ. P. 1.280(b)(3).
Here, to the extent that the requested production may include irrelevant manuals, and the like, and to the extent that the requested production may include work product, Petition has not waived those objections. Petitioner raised the appropriate objections prior to the Motion to Compel hearing. See Defendant’s Response to Plaintiff’s Third Request to Produce, ¶¶1-2.
As for Petitioner’s assertion of trade secret privilege, Petitioner made a timely objection in its Response to Plaintiff’s Third Request to Produce. The Messer court, faced an analogous situation where the trial court did not make an in camera inspection upon assertion of a trade-secret privilege, remarked:
FN1. We reject the suggestion in the trial court’s order that the petitioners’ objection was insufficiently specific. The fact that the petitioners asserted trade secret protection as to whole categories of requested documents rather than to specific, individual items did not render their objections nugatory so as to make in camera inspection unnecessary. A response to a request for production of documents need only set forth the objection and the reason for the objection. DeBartolo-Aventura, Inc. v. Hernandez, 638 So.2d 988, 990 (Fla. 3d DCA 1994). Moreover, Florida Rule of Civil Procedure 1.350(b) does not require that the objection specify individual items unless the objection relates to less than the whole requested category of documents.
Messer v. E.G. Pump Controls, Inc., 667 So.2d 321, 322 n.1 (Fla. 1st DCA 1995). Petitioner timely objected in its Response to Plaintiff’s Third Request to Produce by asserting a trade-secret privilege.
Accordingly, it is hereby ORDERED AND ADJUDGED that:
1) Respondent’s Motion to Dismiss is DENIED;
2) Progressive’s Petition for Writ of Certiorari is GRANTED;
3) The County Court’s Order on Plaintiff’s Motion to Compel Better Responses to Third Request to Produce is QUASHED; and
4) This cause is REMANDED to the County Court for proceedings consistent with this Order specifically and in camera review.
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