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Small v. WellDyne, Inc.

United States District Court, E.D. North Carolina, Western Division

June 8, 2017

Michael A. Small, Administrator of the Estate of Bertha Autry Small Plaintiff,
WellDyne, Inc., et al., Defendants.


          Robert T. Numbers II United States Magistrate Judge

         Plaintiff Michael A. Small, the Administrator of the Estate of Bertha Autry Small, requests that the court compel the Defendants to provide both additional and more detailed responses to the Estate's discovery requests. According to the Estate, WellDyne's responses and objections fall well short of what is required by the Federal Rules. After reviewing the responses and considering the arguments of the parties, the court largely agrees with the Estate's arguments. Because of its failure to comply with its discovery obligations, as set out in more detail below, WellDyne shall supplement many of its responses and explain why the court should not require it to pay the costs and fees that the Estate incurred in connection with this motion.

         I. Background

         WellDyne Rx is a Florida company that fulfills prescriptions by mail. Bertha Small, a resident of North Carolina, was among the individuals who regularly received her prescription medication from WellDyne. In November 2013, WellDyne sent Bertha the wrong medications. Several days later, after taking the misdirected medications, she died. Represented by its Administrator, Michael Small, her estate sued, alleging that WellDyne's error caused Bertha's death.

         The Estate served interrogatories, requests for admission, and requests for production of documents seeking a variety of documents and information related to its claims. WellDyne responded, objecting to several of these requests. The parties communicated back and forth in an effort to resolve their differences, and they resolved several issues with WellDyne filing four supplemental response. But they could not resolve their disputes for 16 interrogatories, 10 requests for production, and 14 requests for admission. The Estate filed two motions to compel, which are now before this court. The court held a hearing on the motions on February 21, 2017.

         II. Discussion

         The Federal Rules of Civil Procedure authorize parties to “obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case . . . .” Fed.R.Civ.P. 26(b)(1). A matter is relevant if it has “any tendency to make a fact more or less probable than it would be without the evidence;” and “the fact is of consequence in determining the action.” Fed.R.Evid. 401. Even if the discovery is relevant, it must still be proportional to the needs of the case. The Federal Rules set out several items the court should consider when assessing proportionality: “the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.” Fed.R.Civ.P. 26(b)(1).

         A. General Objection on the Basis of Proportionality

         WellDyne claims, as a general matter, that the Estate's discovery requests are not proportional to the needs of the case. But it does not provide any support for this assertion. Although the 2015 Amendments to the Civil Rules were enacted to bring greater attention to the importance of proportionality in the discovery process, they do “not . . . permit the opposing party to refuse discovery simply by making a boilerplate objection that it is not proportional.” Fed.R.Civ.P. 26, Advisory Committee Notes (2015 Amendment). A party raising a proportionality objection must include specific details in its objection that explain why the request is improper.

         Also, general objections are an inappropriate response to interrogatories and requests for production of documents because the Federal Rules require parties to state their objections with specificity. Fed.R.Civ.P. 33(b)(4) (“The grounds for objecting to an interrogatory must be stated with specificity.”); Fed.R.Civ.P. 34(b)(2)(B) (“[T]he response must . . . state with specificity the grounds for objecting to the request, including the reasons.”).

         In light of WellDyne's failure to properly state or support its proportionality objections, these objections are overruled.

         B. Quality-Related Event Reporting Privilege

         In its initial responses to the Estate's discovery, WellDyne claimed that it did not need to respond to Interrogatories 41 and 44 and Request for Production 44 because they sought documents and information that are immune from discovery under a Florida regulation related to pharmacy quality assurance programs. WellDyne has since supplemented its response to address the two interrogatories, but the dispute over Request for Production 44 persists. Similarly, WellDyne claims it does not have to answer Requests for Admission 36-47 because those requests seek information on reports sent to the Florida and North Carolina Boards of Pharmacy that it claims is also immune from discovery. The privilege WellDyne relies upon allows it to withhold some, but not all, of the documents and information requested by the Estate.

         1.Interrogatory 41

         To begin with, Interrogatory 41 seeks information about any complaints that WellDyne's customers lodged with various governmental agencies dealing with other prescription medication shipping errors made by WellDyne. Although WellDyne initially refused to produce this information, it supplemented its responses in October 2016 to indicate that no complaints were filed. Thus, the motion to compel a further response to Interrogatory 41 is denied as moot.

         2. Interrogatory 44

         Next, Interrogatory 44 seeks the identity of individuals that WellDyne terminated or disciplined as a result of prescription medication shipping errors. WellDyne's Supplemental Response abandons its previous objections and generally states that the individual who made the error at issue here has been terminated and that “[a]s to other incidents, several employees have been disciplined.” D.E. 79 at 63-64. Because this response provides only a partial answer to the Estate's interrogatory, WellDyne shall supplement its response to provide the identity of each of these employees, what error they each made, and what action WellDyne took against them.

         3. Request for Production 44

         Request for Production 44 seeks any documents about Bertha's death that WellDyne submitted to Florida's Board of Pharmacy. WellDyne objects based upon both the privilege provided under Florida law for records maintained as a component of a pharmacy's continuous quality improvement program and a requirement under North Carolina law that requires out-of-state pharmacies to comply with their home state's statues and regulations. Neither of these provisions provide the complete exemption from providing responsive documents that WellDyne claims that it does.

         The court will begin with WellDyne's argument about North Carolina's administrative code because the court can dispense with it quickly. WellDyne argues that a North Carolina regulation compels it to withhold these documents because they are immune from discovery. But this regulation does not provide it with immunity from discovery. Instead, it requires that “[a]n out-of-state pharmacy shall comply with the statutes and regulations of the state in which the pharmacy is located.” 21 N.C. Admin. Code 46.1607(d). Thus WellDyne's argument is mistaken because North Carolina's administrative code commands only pharmacies to comply with their home state's rules; it does not command courts and third-parties to also comply with those rules. And there is no Florida regulation that prohibits pharmacies from producing documents maintained in connection with a continuous quality improvement program, only a provision that authorizes a pharmacy to do so if it wishes.

         Next, the court will turn to the more complicated issue of whether the Estate's discovery requests seek privileged documents and information. Florida law affords discovery immunity to records maintained as a part of a pharmacy's continuous quality improvement program. The parties dispute whether this immunity is applicable in this case, which is pending in a federal court in North Carolina. The Estate claims that the privilege is not applicable because state rules of procedure do not apply in a federal action. But because the substantive claims in this case are governed by state instead of federal law, state law will control on privilege issues. Ultimately, the court determines that North Carolina law applies to this matter and provides for a similar privilege to the documents and information the Estate requests. Thus, WellDyne may refrain from responding to some of Small's discovery requests because of the privilege that applies to a pharmacy's quality assurance program, but it must respond to others.

         Rule 501 of the Federal Rules of Evidence governs matters of privilege. The relevant portion of the rule provides that “in a civil case, state law governs privilege regarding a claim or defense for which state law supplies the rule of decision.” Fed.R.Evid. 501. When an issue arises for which a state's privilege law applies, courts apply the choice of law principles of the forum state. See Metric Constructors, Inc. v. Bank of Tokyo-Mitsubishi, Ltd., No. 5:97-cv-369-BR, 1998 WL 1742589, at *1 (E.D. N.C. Sept. 28, 1998) (citing cases). Thus, North Carolina's choice of law principles determine whether North Carolina or Florida law governs this privilege dispute.

         In cases involving tort claims in North Carolina, “matters affecting the substantial rights of the parties” are governed by the law of “the state where the injury occurred[]”; and “remedial or procedural rights” are governed by the law of the state where the plaintiff filed the case. Mitchell v. HCL Am., Inc., 190 F.Supp.3d 477, 488 (E.D. N.C. 2016) (quoting Boudreau v. Baughman, 322 N.C. 331, 335, 368 S.E.2d 849 (1988)). Privilege issues are procedural in nature. See Ashcraft v. Conoco, Inc., 218 F.3d 282, 282 n.5 (4th Cir. 2000) (“[T]he availability of an evidentiary privilege is governed by the law of the forum state.”); Frugard v. Pritchard, 338 N.C. 508, 510, 450 S.E.2d 744, 745 (1994) (“The law of the forum, in this case North Carolina, governs as to the admissibility of evidence.”); Tennessee Carolina Transp., Inc. v. Strick Corp., 283 N.C. 423, 437, 196 S.E.2d 711, 720 (1973) (“[Q]uestions of the admission and exclusion of evidence are generally considered procedural[.]”). Thus, because this case is pending in North Carolina, its privilege rules will apply.

         WellDyne claims that it does not have to respond to certain discovery requests because the Estate seeks documents and information that relate to its Continuous Quality Improvement Program. The relevant Florida regulation provides that “[r]ecords maintained as a component of a pharmacy Continuous Quality Improvement Program are . . . considered peer-review documents and are not subject to discovery in civil litigation or administrative actions.” Fla. Admin. Code r. 64B16-27.300(5). Florida law requires its pharmacies to establish a Continuous Quality Improvement Program in an attempt to “identify and evaluate quality-related events and improve patient care. Id. at 64B16-27.300(1) & (3)(a). The term “quality-related events” refers to various errors in filling prescriptions, including providing a patient with incorrect medication. Id. at 64B16-27.300(2).

         Similarly, North Carolina law requires pharmacies to “establish or participate in a pharmacy quality assurance program . . . .” N.C. Gen. Stat. § 90-85.47(a). This provision applies to out-of-state pharmacies as well as those based in North Carolina. Id. The purposes of this requirement are to “enhance the quality of health care and reduce medication errors in this State by facilitating a process for the continuous review of the practice of pharmacy.” Id. at §90-85.45. Among the issues that the quality assurance program must evaluate is “[t]he cause of alleged medication errors . . . .” Id. at § 90-85.47(a)(2).

         Like its Florida counterpart, North Carolina law prevents parties from discovering or introducing the records of a pharmacy quality assurance program as evidence in a civil action. Id. at § 90-85.47(d) (“The proceedings of a pharmacy quality assurance program, the records and materials it produces, and the materials it considers shall be confidential . . . and shall not be subject to discovery or introduction into evidence in any civil action . . . .”). The North Carolina provision also parallels Florida law in that “information, documents, or records otherwise available are not immune from discovery or use in a civil action merely because they were presented during proceedings of the pharmacy quality assurance program.” Compare id., with Fla. Stat. §766.101(5) (“[R]ecords otherwise available from original sources are not to be construed as immune from discovery or use in any such civil action merely because they were presented during proceedings of such committee . . . .”). Thus, the North Carolina privilege for pharmacy quality assurance program does provide some limitation on the types of documents and information that the Estate can obtain from WellDyne during the discovery process.

         While the Estate may be limited in what discovery it can obtain from WellDyne's quality assurance program, that limitation does not mean that all of WellDyne's objections are proper or properly supported. For example, Request for Production 44 seeks documents that WellDyne sent to the Florida Board of Pharmacy related to Bertha's death. Although WellDyne objects on the basis that these documents are part of its quality assurance program, [1] it has provided the court with no information to support this claim; and the privileged nature of these documents is not apparent on the face of the discovery request, at least under the privilege invoked by WellDyne. See Hammond v. Saini, 367 N.C. 607, 610, 766 S.E.2d 590, 592 (2014) (“The party asserting the privilege has the burden to demonstrate each of its essential elements and cannot meet this burden by mere conclusory assertions.”).

         The court notes that in its response in opposition to the Estate's Motion to Compel WellDyne indicates that North Carolina's Administrative Code provides immunity from reports in the North Carolina Board of Pharmacy. Mem. in Opp'n at 5, D.E. 66 (citing 21 N.C. A.C. §46.1607(g)). But neither this provision nor a Florida counterpart were raised in its objections to the Estate's discovery requests. Therefore, these objections have been waived. RLM Commc'ns, Inc. v. Tuschen, 66 F.Supp.3d 681, 704 (E.D. N.C. 2014), aff'd, 831 F.3d 190 (4th Cir. 2016).

         Thus, WellDyne shall respond to Request for Production 44. If WellDyne claims that specific responsive documents are immune from discovery under the privilege for quality assurance programs, then it shall affirmatively indicate that it is withholding these records and ...

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