Extendicare, Inc. v. Hon William G. Clouse Jr Judge, Madison Circuit Court

TO BE PUBLISHED
S5uprrntr Conti of 7 rtifurliv
2015-SC-000045-MR
RICHMOND HEALTH FACILITIES-MADISON, LP,
D/B/A MADISON HEALTH & REHABILITATION
CENTER; PREFERRED CARE PARTNERS
MANAGEMENT GROUP, LP; PREFERRED CARE, INC.,
D/B/A PREFERRED CARE OF DELAWARE, INC.;
AND KENTUCKY PARTNERS MANAGEMENT, LLC APPELLANTS
ON APPEAL FROM COURT OF APPEALS
V. CASE NO. 2014-CA-001634-OA
MADISON CIRCUIT COURT NO. 13-CI-00176
HONORABLE WILLIAM G. CLOUSE, JR.,
JUDGE, MADISON CIRCUIT COURT APPELLEE
AND
SHARON BRESHERS, AS
ADMINISTRATRIX OF THE ESTATE OF
GERALDINE McCAFFERTY, DECEASED REAL PARTY IN INTEREST
AND 2015-SC-000122-MR
EXTENDICARE, INC.; EXTENDICARE, L.P.;
EXTENDICARE HOMES, INC.; FIR LANE TERRACE
CONVALESCENT CENTER, INC., D/B/A MADISON
HEALTH & REHABILITATION CENTER;
EXTENDICARE HEALTH NETWORK, INC.;
EXTENDICARE HOLDINGS, INC.;
EXTENDICARE HEALTH SERVICES, INC.; AND
EXTENDICARE HEALTH FACILITY HOLDINGS, INC. APPELLANTS
ON APPEAL FROM COURT OF APPEALS
V. CASE NO. 2014-CA-001710-OA
MADISON CIRCUIT COURT NO. 13-CI-00176
HONORABLE WILLIAM G. CLOUSE, JR.,
JUDGE, MADISON CIRCUIT COURT APPELLEE
AND
SHARON BRESHERS, AS
ADMINISTRATRIX OF THE ESTATE OF
GERALDINE McCAFFERTY, DECEASED REAL PARTY IN INTEREST
OPINION AND ORDER
Richmond Health Facilities-Madison, LP (Richmond Health) and
Extendicare, Inc. (Extendicare) 1 petition this Court for a writ of prohibition to
prevent the trial court from compelling the production of various documents
associated with the care provided at the long-term-care facilities within their
control. The Court of Appeals denied Richmond Health and Extendicare's
petitions because it found no error in the trial court's decision to allow
discovery of the documents; specifically, the court allowed discovery because
the parties had failed to provide sufficient evidence that the Federal Quality
Assurance Privilege (FQAP) applied to the documents in question. For reasons
set forth below, we affirm the Court of Appeals and deny the issuance of a writ.
I. FACTUAL AND PROCEDURAL BACKGROUND.
In 2012, Geraldine McCafferty was admitted to Richmond Health, a
nursing facility owned and operated by Extendicare. But McCafferty's health
rapidly deteriorated so she was transferred to the University of Kentucky
Chandler Hospital after only a month's stay. Eventually, McCafferty passed
away. Following McCafferty's death, Sharon Breshers, the Administratrix of
McCafferty's estate, filed suit against Richmond Health and Extendicare,
alleging wrongful death, nursing-home abuse, and corporate negligence. The
gravamen of Breshers's claim is that Extendicare, in an attempt to boost
profits, purposefully diverted necessary funds from Richmond Health; and, as a
1 Various corporate iterations of both Richmond Health and Extendicare are
involved in this writ action as co-defendants. For the sake of simplicity, we simply use
"Richmond Health" and "Extendicare," singularly, to refer to the respective collection
of defendants.
2
result, McCafferty was deprived of adequate medical care, which led to her
death.
During discovery, Breshers sought the production of various documents
relating to Richmond Health's clinical monitoring and oversight. In addition,
Breshers requested documents dealing with corporate finance matters alleged
to indicate Extendicare's negligence in funding Richmond Health. Of course,
Richmond Health and Extendicare rejected Breshers's requests as an irrelevant
fishing expedition for privileged information.
The trial court ordered Richmond Health and Extendicare to produce the
requested financial documents and allegedly privileged information. In its
order, the trial court did take certain precautions against the disclosure of any
potentially private information by issuing a protective order covering patient
and personnel files, as well as corporate accounting methodologies perhaps
considered proprietary.
Richmond Health and Extendicare, co-defendants at the trial level,
separately sought prohibitive writs from the Court of Appeals. Both parties
argued the documents sought by Breshers were privileged under FQAP and,
therefore, should not be produced. Additionally, Richmond Health and
Extendicare argued their financial information was irrelevant and the trial
court erroneously denied their request for a protective order. The petitions
were heard by separate panels of the Court of Appeals, but the same result was
reached. Both Richmond Health and Extendicare failed to produce a privilege
log so each Court of Appeals panel held the petitions fell short of the high
3
burden involved when asserting a claim of privilege. Likewise, each panel held
financial information was relevant to Breshers's punitive-damages claim. As
for the protective order, the record indicated that Extendicare had already
disclosed the information the protective order sought to cover so its writ
petition was denied; and Richmond Health's panel held it had an adequate
appellate remedy with regard to the protective order so its petition was denied.
Operating separately yet again, Richmond Health and Extendicare now
petition this Court for a writ of prohibition under Kentucky Rules of Civil
Procedure (CR) 76.36(7)(a). 2
II. ANALYSIS.
When ruling on a writ petition, we must first determine if the writ is
appropriate. We review the merits of a writ petition and, in turn, the
soundness of a trial court's decision, only if a writ is a suitable remedy. The
issuance of a writ always lies within this Court's discretion. 3 Truly a
remarkable remedy, a writ action commands conservative use of that discretion
"to prevent short-circuiting normal appeal procedure[.]" 4 Accordingly, a writ
should issue only:
[U]pon a showing that (1) the lower court is proceeding or is about
to proceed outside of its jurisdiction and there is no remedy
through an application to an intermediate court; or (2) that the
lower court is acting or is about to act erroneously, although
within its jurisdiction, and there exists no adequate remedy by
2 Kentucky Rules of Civil Procedure (CR) 76.36(7)(a) reads: "An appeal may be
taken to the Supreme Court as a matter of right from a judgment or final order in any
proceeding originating in the Court of Appeals."
3 Hoskins v. Maricle, 150 S.W.3d 1, 5 (Ky. 2004) (citation omitted).
4 Bender v. Eaton, 343 S.W.2d 799, 800 (Ky. 1961).
4
appeal or otherwise and great injustice and irreparable injury will
result if the petition is not granted. 5
Essentially, writs are divided into two classes. Richmond Health and
Extendicare invoke the second class of writ as they argue the trial court acted
erroneously within its jurisdiction. So our review is for abuse of discretion, i.e.,
a decision that is arbitrary, unreasonable, unfair, or unsupported by sound
legal principles. 6 A writ will only issue within this writ class if a petitioner can
prove irreparable injury, great injustice, and the absence of an appellate
remedy.?
When faced with particular circumstances, we have excused the great-
and-irreparable-injury element in order "to preserve the orderly administration
of the laws."8 These "certain special cases" exist where "a substantial
miscarriage of justice will result if the lower court is proceeding erroneously[]
and correction of the error is necessary and appropriate in the interest of
orderly judicial administration." 9 Our application of this exception is rare,
however, limited primarily to circumstances where the "action for which the
writ is sought would violate the law, e.g. [,] by breaching a tightly guarded
5 Hoskins, 150 S.W.3d at 10.
6See Tax Ease Lien Investments 1, LLC v. Commonwealth Bank & Trust,
384 S.W.3d 141, 143 (Ky. 2012) (noting that standing is a question of law subject to
de novo review); Grange Mut. Ins. Co. v. Trude, 151 S.W.3d 803, 810 (Ky. 2004)
(highlighting de novo review is typically appropriate under the first class of writs
because jurisdiction is a question of law).
7 Hoskins, 150 S.W.3d at 9 ("But if the petition alleged only that the trial court
was acting erroneously within its jurisdiction, a writ would issue only if it was shown
that there was no adequate remedy by appeal and great injustice and irreparable harm
would otherwise occur.").
8 Ohio River Contract Co. v. Gordon, 186 S.W. 178, 181 (Ky. 1916).
9 Hoskins, 150 S.W.3d at 20 (quoting Bender, 343 S.W.2d at 801).
5
privilege or by contradicting the requirements of a civil rule." 10 Of course,
Richmond Health and Extendicare argue the instant situation constitutes a
"certain special case." We disagree.
A. The Production of Financial Information was Properly Compelled.
Initially, Richmond Health and Extendicare argue the Court of Appeals
erred in allowing the trial court to compel the production of the financial
information requested by Breshers. The main point of Richmond Health's and
Extendicare's argument is that the financial information sought by Breshers is
irrelevant and, in turn, irreparably harmful.
We do well to remind Richmond Health and Extendicare that CR 26.02,
our rule governing the permissible scope of discovery in civil litigation, trends
toward discovery, permitting discovery "regarding any matter, not privileged,
which is relevant to the subject matter involved in the pending action . . . ." 11
Relvancy"ismor tuedpnr-ialxmtohne
trial, and the Rule requires only relevancy to the subject matter involved in the
action." 12 The Court of Appeals found the challenged financial information was
relevant to Breshers's claim for punitive damages. We agree but, more
importantly, the financial information of Richmond Health and Extendicare
Breshers seeks is central to her entire negligence claim. We are at a loss for
how corporate financial information could be irrelevant to a claim asserting
deliberate withholding or manipulation of funds.
10 Grange Mut., 151 S.W.3d at 808 (quoting Bender, 343 S.W.2d at 801).
11 Maddox v. Grauman, 265 S.W.2d 939, 941 (Ky. 1954).
12 Id.
6
Considering that the information is clearly relevant, we see no way in
which Richmond Health or Extendicare would suffer irreparable injury or
satisfy to any degree the requirements for the application of our certain-
special-cases exception. There is no great injustice or substantial miscarriage
of justice in compelling a party to produce clearly relevant information. We
affirm the Court of Appeals.
B. The Court of Appeals Appropriately Denied Richmond Health's and
Extendicare's Request for a Protective Order.
At the Court of Appeals, both Richmond Health and Extendicare sought
a protective order for the disclosure of their financial information. In
Richmond Health's case, the Court of Appeals denied the protective-order
request because it found there was an adequate remedy on appeal, citing
Hoffman v. Dow Chemical Co. 13 As for Extendicare, the Court of Appeals found
that "the information Extendicare sought to have protected has already been
disclosed to Breshers" so a protective order was unwarranted. We agree.
A protective order is within the full discretion and authority of the trial
court and is appropriate only to prevent a party from "annoyance,
embarrassment, oppression, or undue expense or burden." 4 Notably, the trial
court did, in fact, enter a protective order. In doing so, the trial court properly
gave due weight to Breshers's discovery request while balancing—or attempting
to at the very least—Extendicare's and Richmond Health's desire or need to
keep corporate matters out of the public domain. Extendicare and Richmond
13 413 S.W.2d 332, 334 (Ky. 1967).
14 Ewing v. May, 705 S.W.2d 910, 913 (Ky. 1986).
7
Health remain unhappy with the scope of the trial court's protective order. Be
that as it may, Extendicare and Richmond Health present no colorable
argument as to why exactly the protective order should be broadened. As we
explain below with regard to FQAP, Extendicare's and Richmond Health's tactic
of making broad allegations of imminent harm or entitlement to relief are
unavailing as they afford us little review capability. Given the record before us,
we have no reason to doubt the trial court granted adequate relief as
Extendicare and Richmond Health have presented nothing specific as to why
the trial court's protective order was insufficient.
Perhaps a protective order would be appropriate if we were aware of what
Richmond Health and Extendicare were trying to protect. Much like we
discuss below with regard to the FQAP's scope, Richmond Health and
Extendicare have simply failed to make anyargument sufficient to meet the
burden they carry in seeking a more expansive protective order. We are
unwilling and—in light of the record—unable to conclude the trial court abused
its discretion. Extendicare and Richmond Health are not entitled to a writ, nor
are they entitled to a protective order. We affirm the Court of Appeals on this
issue.
C. Richmond Health and Extendicare Fall Short of their Burden to Show
the FQAP Privilege Applies.
Finally, Richmond Health and Extendicare argue that despite the
financial information's supposed relevancy, FQAP renders it privileged. In an
attempt to improve the quality of care afforded to nursing home residents,
8
Congress enacted in 1987 the Federal Nursing Home Reform Act (FNHRA), 15 of
which FQAP was a subsection. Broadly, FQAP requires "skilled nursing
facilit[ies]" 16 and "nursing facilit[ies]" 17 to establish a quality assessment and
assurance committee in an attempt to ensure nursing homes are vigilant about
the quality of care their residents are receiving. As for the privilege aspect,
FQAP states: "A State or the Secretary may not require disclosure of the
records of such committee except insofar as such disclosure is related to the
compliance of such committee with the requirements of this subparagraph." 18
ItishprovnRcmdHealthExnicrowaguebs
compliance with Breshers's discovery requests.
We have yet to have occasion to interpret FQAP's scope. In actuality,
only two states and one federal court have had such an opportunity. From this
paucity of case law, two rules have emerged: the Missouri Rule 19 and the New
York Rule. 20 Richmond Health and Extendicare petition this Court to decide
affirmatively between these two interpretations. Perhaps this is an important
issue—no doubt it is enticing—but, for the reasons set forth below, we find it
unnecessary to make the choice Richmond Health and Extendicare ask of us.
15 See 42 U.S.C. 1396r, et seq.; 42 U.S.C. 1395i-3, et seq.; 42 C.F.R. 483,
et seq.
16 42 U.S.C. 1395i-3(b)(1)(B).
17 42 U.S.C. 1396r(b)(1)(B).
18 42 U.S.C. 1395i-3(b)(1)(B).
19 See State ex rel. Boone Ret. Ctr. v. Hamilton, 946 S.W.2d 740 (Mo. 1997)
(en bane).
20 See In re Subpoena Duces Tecum to Jane Doe, Esq., 787 N.E.2d 618 (N.Y.
2003).
9
Before the Court of Appeals, Richmond Health argued Breshers failed to
provide "reasonable notice" of the motion to compel as CR 37.01 mandates. 21
AcordingtRchmondHealth'scoun,Bresh'motinwaslyprovide
to Extendicare. Richmond Health allegedly only received oral notice of the
motion at the motion's hearing. The Court of Appeals rejected Richmond
Health's argument, noting that the limited record provided no guidance; and,
as a result, it was impossible to "determine if the issue of lack of notice was
brought to the attention of the trial court." Faced with a silent record on the
issue, the Court of Appeals followed our precedent and presumed the trial
court's decision was supported by the record. If Richmond Health truly
received unreasonable notice of Breshers's motion, it should have produced the
record of the hearing. After all, in a writ action—an original action at an
appellate court—it is even more important to preserve properly the record
because, contrary to normal appellate procedure, "the trial court's record is
unavailable[; and, instead, the appellate record] consists only of what the
parties have included with their filings. "22
Richmond Health can offer no evidence to support its argument that
Breshers did not provide "reasonable notice" of her motion to compel. It was
this alleged lack of notice, though, that Richmond Health argues prohibited it
from producing a privilege log or, for that matter, any form of documentation
identifying what FQAP should apply to. Extendicare likewise did not produce a
21 CR 37.01 ("A party, upon reasonable notice to other parties and all persons
affected thereby, may apply for an order compelling discovery as follows:
(emphasis added).
22 Collins v. Braden, 384 S.W.3d 154, 163 (Ky. 2012).
10
privilege log or any sort of documentation about the allegedly privileged
documents, but Extendicare did receive notice of Breshers's motion to compel.
It is axiomatic that a party who asserts a privilege bears the burden of
proving the privilege applies. 23 Equally fundamental and uncontested is the
principle that testimonial privileges are disfavored and should be strictly
construed. 24 To put it simply, both Richmond Health and Extendicare have
failed to carry their burden to show that FQAP applies, under any standard—
Missouri or New York Rules aside. We have previously rejected a writ petition
to protect a claimed privilege where "the record before us was insufficient to
permit a determination whether any or all of the [documents were subject to
the . . . privilege." 25 Neither Richmond Health nor Extendicare has sought in-
camera review of the documents or produced an even relatively detailed
description of what the documents contain. So we are left with nothing more
than Richmond Health's arguments about the documents—a level of evidence
we have previously deemed insufficient. 26 Based on the record before us, we
are unwilling to say the trial court acted erroneously in granting Breshers's
motion to compel.
23 Stidham v. Clark, 74 S.W.3d 719, 725 (Ky. 2002).
24 Id. at 722.
25 Collins, 384 S.W.3d at 163 (quoting Lexington Pub. Library v. Clark,
90 S.W.3d 53, 63 (Ky. 2002)).
26 Id. at 163-64 ("All we have to go on is the hospital's argument about the
content of the documents. . . . Without more certainty about the content of those
documents, a reviewing court cannot determine whether any statements are even in
the documents or whether any statements are covered by the privilege.").
11
Judicial restraint, rather than reaching into the somewhat murky FQAP
world, is the proper elixir for this case. Again, even if we were to select a rule
governing the application of FQAP, there is nothing to which to apply it.
Richmond Health and Extendicare have given the courts nothing more than
vague references to documents (most likely to obtain a broad discovery
prohibition) and then requested we perform the spectacular task of secreting
them away from Breshers. It bears repeating that blanket assertions of
privilege are not sufficient.
We reject the writ petitions—they do not meet our writ standard and, in
our estimation, would be nothing more than advisory. Essentially, Richmond
Health's and Extendicare's arguments are not properly preserved for our
review—indeed, there is nothing to review. A writ is an extraordinary remedy,
and this Court will not initiate the practice of using writs to save parties from
their own litigation stumblings.
III. CONCLUSION.
We affirm the denial of the writs by the Court of Appeals.
All sitting. Minton, C.J.; Abramson, Noble, and Keller, JJ., concur.
Barber, J., concurs in result only by separate opinion in which Cunningham
and Venters, JJ., join.
BARBER, J., CONCURRING IN RESULT ONLY: Because this subject
matter will likely come back up in this and other cases, I would go a step
further than the majority and analyze the application of the FQAP.
12
As part of the Omnibus Budget Reconciliation Act of 1987, Congress
enacted the Federal Nursing Home Reform Act ("FNHRA") to "improve the
quality of care for . . . nursing home residents." Pub. L. No. 100-203, §§ 4201-
4218; H.R. Rep. No. 100-391, pt. 1, at 452 (1987). At issue in this case is a
subsection of FNHRA, the Federal Quality Assurance Privilege '12 U.S.C.
Sections 1395i-3(b)(1)(B) (skilled nursing facilities) and 1396r(b)(1)(B) (nursing
facilities)—which respectively provide:
A [skilled] nursing facility must maintain a quality assessment and
assurance committee, consisting of the director of nursing services,
a physician designated by the facility, and at least 3 other
members of the facility's staff, which (i) meets at least quarterly to
identify issues with respect to which quality assessment and
assurance activities are necessary and (ii) develops and
implements appropriate plans of action to correct identified quality
deficiencies. A State or Secretary may not require disclosure of the
records of such committee except insofar as such disclosure is
related to the compliance of such committee with the requirements
of this subparagraph.
42 U.S.C. § 1395i-3(b)(1)(B). The purpose of the FQAP is to "protect the
[Quality Assurance] committee's own records—its minutes or internal working
papers or statements of conclusion—from discovery." Jewish Home of E. PA v.
Ctrs. for Medicare and Medicaid Servs., 693 F.3d 359, 362 (3d Cir. 2012). The
goal is to engender self-critical analysis and ultimately, improve the quality of
nursing home residents' health care. 27
27 I do agree—subject to a caveat—with Appellants' statement that "[title Federal
Quality Assurance Privilege is intended to allow a health care provider self-critical
analysis with the goal of improved care without fear of the process being used to
punish the health care provider." However, "fear of reprisal" is by no means absolute,
and must be balanced with the FNHRA's ultimate goal of "improv[ing] the quality of
care for . . . nursing home residents." H.R. Rep. No. 100-391, pt. 1, at 452 (1987).
13
A. Scope of the FQAP
This Court has yet to address the scope of the FQAP. Two state supreme
courts and one federal appellate court, however, have addressed the issue—
albeit reaching differing conclusions. The Missouri Supreme Court and the
U.S. Court of Appeals for the Third Circuit narrowly construed the FQAP to
only privilege documents that are "generated" by a nursing home's quality
assurance committee. See Jewish Home of E. PA v. Ctrs. for Medicare and
Medicaid Servs., 693 F.3d 359, 362 (3d Cir. 2012); State ex rel. Boone Ret. Ctr.
v. Hamilton, 946 S.W.2d 740, 743 (Mo. 1997) (en banc). The New York Court of
Appeals extended Boone's holding to privilege all documents created "by or at
the behest of" a nursing home's quality assurance committee. See In re
Subpoena Duces Tecum to Jane Doe, Esq., 787 N.E.2d 618, 623 (N.Y. 2003). I
would adopt the former approach and hold that only documents generated by a
nursing home's quality assurance committee fall within the scope of the FQAP.
"This statutory privilege is exceedingly narrow." Boone, 946 S.W.2d at 743.
B. The "Missouri" Approach
The Supreme Court of Missouri, and subsequently the U. S. Court of
Appeals for the Third Circuit, each narrowly construed the FQAP. See Jewish
Home, 693 F.3d at 362; Boone, 946 S.W.2d at 743. Both courts limited the
scope of the statute by holding that only reports which are "generated" by a
nursing home's quality assurance committee are covered by the FQAP. See
Jewish Home, 693 F.3d at 362 ("The language of 42 U.S.C. § 1396r(b)(1)(B) .. .
limits the scope of protection from discovery to the records generated by the
Quality Assurance Committee.") (emphasis added); see also State ex rel. Boone,
14
946 S.W.2d 740, 743 (finding that the FQAP "protects only the committee's own
records—its minutes or internal working papers or statements of conclusions
from discovery.").
Following the Supreme Court of Missouri, the Third Circuit—the only
federal appellate court which has construed the scope of 42 U.S.C. §
1396r(b)(1)(B)—held that the FQAP "limits the scope of protection from
discovery to the records generated by the Quality Assurance Committee."
Jewish Home, 693 F.3d at 362 (citing Boone, 946 S.W.2d at 743) (emphasis
added). Quoting the Missouri. Supreme Court, the Third Circuit agreed that
"[n]o honest reading of the statute . . . can extend the statute's privilege to
records and materials generated outside the committee and submitted to the
committee for its review." Jewish Home, 693 F.3d at 362. I agree.
In Jewish Home, the documents in question were "contemporaneous,
routinely-generated incident reports that were part of the residents' medical
records." Id. Because these documents were not "minutes, internal papers, or
conclusions generated by the Quality Assurance Committee," the Third Circuit
held that the documents were not protected by the FQAP. Id. Likewise, the
documents Breshers seeks to discover do not fall within the scope of the FQAP
because they were not generated by Appellants' Quality Assurance Committee,
nor are they minutes, internal papers or conclusions of the Quality Assurance
Committee. Id.
15
C. The "New York" Approach
New York's highest court28 opted for a broader interpretation of the
FQAP. See In re Subpoena Duces Tecum to Jane Doe, Esq., 787 N.E.2d 618,
623 (N.Y. 2003) ("We read the language 'records of such committee' (42 U.S.C.
§ 396r[b][1][B][ii]) as encompassing within its parameters any reports generated
by or at the behest of a quality assurance committee for quality assurance
purposes."); see also id. ("[C]ompilations, studies or comparisons of clinical
data derived from multiple records, created by or at the request of committee
personnel for committee use, are 'records of such committee' and entitled to
protection from disclosure pursuant to federal law."). Applying this standard,
the Court of Appeals of New York found that the FQAP protected the nursing
home's monthly skin condition reports, pressure sore reports, monthly weight
reports, and the list of facility-acquired infections—none of which were
generated by the quality assurance committee. Id. at 623.
In Jane Doe, the parties agreed that the residents' clinical records were
not covered by the FQAP. The court noted that "such records do not acquire
quality assurance protection merely because they are reviewed or used by a
quality assurance committee. Id. at 622. The parties additionally agreed that
the work product of the quality assurance committee was privileged by the
FQAP. Id. The controversy thus centered on "what documents or reports
28 New York's court of last resort is the Court of Appeals of New York. For the
opinion, see In re Subpoena Duces Tecum to Jane Doe, Esq., 787 N.E.2d 618 (N.Y.
2003). Additionally, Appellants rely on a lower court decision from Massachusetts to
bolster their argument in favor of a broad interpretation of the FQAP. See Evans v.
Quaboag on the Common, Inc., et al., 26 Mass L. Rptr. 372 (Superior Ct. Mass Dec. 7,
2009). We find neither of these cases controlling, nor convincing.
16
constitute 'records of such committee' under 42 U.S.C. § 1396r(b)(1)(B)(ii). Id.
The petitioner therein argued that because the nursing home's incident
reports, infections reports, and the like were derived from clinical records that
were not privileged by the FQAP, they should likewise not fall within the ambit
of the FQAP. Id. at 623. Ultimately, the court determined:
While we agree with the Missouri court and petitioner that the
federal protection is narrow, we decline to adopt the Boone
standard because the federal statute does not restrict quality
assurance records to only those reports created by quality
assurance committee members themselves. We read the language
"records of such committee" (42 USC § 1396r [b][1][B][ii]) as
encompassing within its parameters any reports generated by or at
the behest of a quality assurance committee for quality assurance
purposes.
Id. I disagree. Extending the FQAP to encompass any reports generated "at
the behest of" a nursing home's quality assurance committee has troubling
implications. 29 It runs headlong into decades of Kentucky and federal
jurisprudence that have narrowly construed the scope of privileges. 30
Furthermore, I am not convinced by Ap el ants' conjecture that he quality of
nursing home care will decline for fear of litigation if this Court were to adopt a
narrow construction of the FQAP. 31 I recognize that the purpose of the FQAP is
29 Not the least of which is what precisely does "at the behest of mean.
30 Kentucky has traditionally allowed a very limited number of privileges. See,
e.g., KRE 501-11. For example, this Court recently declined to recognize a physician-
patient privilege. See Caldwell v. Chauvin, No. 2014-SC-000390-MR, 2015 WL
3653447, at *1 (rendered June 11, 2015).
31 Of note, we have rejected a similar argument in the context of the peer-review
privilege and medical negligence claims. See Sisters of Charity Health Sys., Inc. v.
Raikes, 984 S.W.2d 464, 470 (Ky. 1998); see generally KRS 311.377(2).
17
to encourage self-critical analysis; however, the ultimate goal is to "improve the
quality of care for . . . nursing home residents." H.R. Rep. No. 100-391, pt. 1,
at 452 (1987). Thus, as previously noted, Appellants' "fear of reprisal" is by no
means absolute, and must be balanced against the fundamental objective of
the FQAP—improving quality of care. In that vein, I believe that Boone's
construction more accurately reflects Congress's intent to privilege a narrow
set of information, and allows self-critical evaluation without overprotecting—
under the auspice of "quality control"—information such as that at issue in the
case at bar.
Moreover, although Appellants rely heavily on Jane Doe's holding, they
failed to take heed of the New York court's warning: "[for the future, we
recommend that a party seeking to protect documents from disclosure compile
a privilege log in order to aid the court in its assessment of a privilege claim."
Id. The Court of Appeals rejected Appellants' position for this very reason.
Additionally, despite Appellants' ipse dixit argument to the contrary, 32
32 Appellants argue that the FQAP preempts Kentucky's long held practice of
strictly construing privileges, but cites no authority on point to bolster their
contention. This however, should not be a point of contention, because the Court of
Appeals readily acknowledged that the FQAP preempts state law. Court of Appeals
Order at 7. Appellants simply claim that because the FQAP preempts state law, it
must be broadly construed to privilege all quality assurance documents. In re Jane
Doe, a case upon which Appellants heavily rely, does not support their assertion. See
In re Subpoena Duces Tecum to Jane Doe, Esq., 787 N.E.2d 618, 622 (N.Y. 2003) ("A
facility may not create a privilege where none would otherwise exist merely by
assigning the duty for compliance or compilation to a quality assurance committee.").
The FQAP's broadest interpretation can be found in In re Jane Doe, but even New
York's highest court limited the privilege to "any reports generated by or at the behest
of a quality assurance committee." Id. at 623. Here, Appellants seek an even broader
interpretation from this Court, and neglect to address the only federal case
interpreting the FQAP, which supports a contrary construction. See Jewish Home of
E. PA v. Centers for Medicare and Medicaid Services, 693 F.3d 359 (3d Cir. 2012).
18
privileges are strictly construed under both federal and Kentucky law. See
Collins v. Braden, 384 S.W.3d 154, 159 (Ky. 2012); Sisters of Health Sys., Inc. v.
Raikes, 984 S.W.2d 464, 468 (Ky. 1998) (quoting Trammel v. United States,
445 U.S. 40, 45 (1980) ("Privileges should be strictly construed because they
contravene the fundamental principle that 'the public . . . has a right to every
man's evidence.")). Appellants disregard established federal and Kentucky
case law by arguing that the FQAP preempts Kentucky law, and hence, should
not be strictly construed. Confusingly, Appellants offer no federal authority in
support of this contention, except to say that privileges should be determined
on a case-by-case basis. Furthermore, their argument disregards decades of
Supreme Court jurisprudence that has narrowly construed privileges. See
Trammel, 445 U.S. at 50 (1980) (holding that privileges must be
"strictly construed"); id. at 50 ("Exclusionary rules and privileges contravene
the fundamental principle that the public . . . has a right to every man's
evidence."') (quoting U.S. v. Bryan, 339 U.S. 323, 331 (1950)); see also
Swidler & Berlin v. United States, 524 U.S. 399, 411 (O'Connor, J., dissenting)
(noting that the Supreme Court has historically construed the scope of
privileges narrowly); Jaffee v. Redmond, 518 U.S. 1, 19 (1996) (Scalia, J.,
dissenting) (pointing to the Supreme Court's history of narrowly construing
privileges); Univ. of Pa. v. EEOC, 493 U.S. 182 (1990) (narrowly construing
common-law privilege).
The only case cited in support of Appellants' broad interpretation is
Goodyear Tire & Rubber Co. v. Chiles Power Supply, Inc., a Sixth Circuit opinion
19
which stands for the proposition that privileges should be determined on a
"case-by-case" basis. See 333 F.3d 976, 979-80 (6th Cir. 2003). I do not
disagree. However, Goodyear Tire is inapposite to the current controversy. The
quoted language from Goodyear Tire is referring to the recognition of new
privileges, not the construction of existing ones. 33 Id. at 980. Accordingly, in
the absence of authority to the contrary, this Court should defer to the
"fundamental principle that the public . . . has a right to every man's
knowledge." See Trammel, 445 U.S. at 50 (internal quotation omitted).
Privileges, being "in derogation of the search for truth," are not "expansively
construed." United States v. Nixon, 418 U.S. 683, 710 (1974). The FQAP is no
exception.
In Boone and Jane Doe, the high courts of Missouri and New York each
readily acknowledged that they were dealing with a case of first impression that
had yet to be settled by a federal court. 34 Since that time, however, the Third
Circuit addressed the issue in Jewish Home, and adopted Boone's narrow
construction of 42 U.S. § 1396r(b)(1)(B), which "limits the scope of
protection . . . to the records generated by the Quality Assurance Committee."
Jewish Home, 693 F.3d at 362 (citing Boone, 946 S.W.2d at 743 (emphasis
added)). For the reasons discussed herein, I agree and would adopt the narrow
construction of the FQAP set forth in Boone and Jewish Home.
33 See Goodyear Tire, 333 F.3d at 980 ("[T]he recognition of a privilege should be
judged on a case-by-case basis and weighed against the public interest.").
34 See Boone, 946 S.W.2d at 742 ("This is a case of first impression. No federal
court has interpreted theses statutes); In re Jane Doe, 618 N.E.2d at 621 ("[N]either
this Court nor any federal court has previously interpreted [the FQAP]).
20
Therefore, to the extent that the records sought to be discovered by
Breshers were not generated by Appellants' Quality Assurance Committee, and
are not "minutes or internal working papers or statements of conclusion," I
would hold that they are not covered by the FQAP, and hence, are discoverable.
Jewish Home, 693 F.3d at 362. Therefore, I would go further than the majority
by adopting this application of the FQAP and would, thus, instruct the courts
below to proceed accordingly.
Cunningham and Venters, JJ., join.
ENTERED: October 29, 2015.
aPe
IE JUSTICE
F JUST
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