In RE CHEFS' PRODUCE OF HOUSTON, INC., AND MARIO ALBERTO RANGEL v. the State of Texas

Supreme Court of Texas
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No. 22-0286
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In re Chefs’ Produce of Houston, Inc., and Mario Alberto Rangel,
Relators
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On Petition for Writ of Mandamus
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PER CURIAM
The defendants in this personal-injury suit arising from a car
accident petition for mandamus relief from the trial court’s order
striking their counteraffidavit served under Section 18.001 of the Civil
Practice and Remedies Code. Relying on our opinion in In re Allstate
Indemnity Insurance Co., 622 S.W.3d 870 (Tex. 2021), the defendants
argue that the trial court’s order was an abuse of discretion for which
they lack an adequate remedy by appeal. We agree and conditionally
grant the writ.
I. Background
Antonio Estrada was admitted to St. Luke’s Medical Center for
treatment after being involved in a car accident with Mario Rangel in
Houston. At the hospital, Estrada complained of head, shoulder, neck,
and rib pain along his right side. The hospital conducted x-rays of his
right shoulder, chest, and ribs. All three x-rays came back negative.
The hospital also performed a CT scan of his spine, which indicated
injuries.
Estrada later received a shoulder and back MRI at Memorial MRI
and Diagnostics. The shoulder MRI indicated that he suffered from
bicep tendinosis, which is caused by degeneration of the bicep tendon’s
collagen due to chronic overuse.
After the MRI, Estrada received pain-management care from
DaVinci Pain Consultants, which administered a shoulder-block
injection for his right shoulder pain. DaVinci indicated that it provided
the injection to treat osteoarthritis, adhesive capsulitis, and rheumatoid
arthritis, though Estrada’s medical records did not indicate that he
suffered from any of these conditions in his right shoulder.
Estrada sued Rangel and his employer, Chefs’ Produce of
Houston, Inc. (collectively, Defendants), alleging that Rangel’s
negligence caused the car accident and Estrada’s resulting injuries.
Estrada timely served an affidavit under Section 18.001 of the Civil
Practice and Remedies Code, averring that he had incurred $19,321 in
reasonable and necessary medical expenses because of the accident.
Defendants timely served a counteraffidavit challenging the
reasonableness and necessity of those expenses. Defendants retained
Dr. Benny Sanchez—an anesthesiologist and pain-management doctor
practicing in the Houston area—as its counteraffiant, attaching a copy
of Dr. Sanchez’s curriculum vitae as an exhibit to the counteraffidavit.
The counteraffidavit and CV collectively establish Dr. Sanchez’s
qualifications. He has practiced anesthesiology and pain management
for over thirty years. In addition, he treats automobile-accident patients
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as part of his practice. He is familiar with reasonable and necessary
medical charges for pain management and anesthesiology care through
his experience as a practicing physician.
In his counteraffidavit, Dr. Sanchez concluded that some of the
care Estrada received was neither necessary nor reasonable. For
example, based on imaging studies, Dr. Sanchez opined that Estrada
had a preexisting shoulder injury that rendered the shoulder MRI
unreasonable and medically unnecessary. Dr. Sanchez further opined
that, based on his experience as a pain-management physician,
Estrada’s shoulder-block injection was similarly unreasonable and
medically unnecessary. Finally, concerning other care that Dr. Sanchez
agreed was medically necessary, he opined that the providers charged
substantially inflated rates. To reach this opinion, he compared the
amounts cited in Estrada’s affidavit to three sources: the National
Medicare Fee Guideline, the Healthcare Bluebook for the Houston area,
and the cash price Dr. Sanchez charges his patients in his Houston-area
practice.
The National Medicare Fee Guideline provides guidelines for
determining the reasonable charge that Medicare will reimburse for
various procedures. The Healthcare Bluebook is a national database of
costs for medical services broken down by zip code. Dr. Sanchez’s
assessment of what constituted a reasonable fee was consistently higher
than both the Medicare guideline price and his cash price.
Estrada moved to strike Dr. Sanchez’s counteraffidavit and
testimony. Estrada argued that the counteraffidavit improperly
challenged the cause of Estrada’s injuries, not the necessity of his
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treatment. He further argued that Medicare rates and Dr. Sanchez’s
cash rates were unreliable methods for approximating a reasonable
charge for medical services. The trial court granted the motion, striking
Dr. Sanchez’s counteraffidavit “and the statements, opinions, and
testimony contained therein,” and precluding Defendants from calling
Dr. Sanchez as a witness to provide such testimony.
Over nine months after the trial court signed that order, we
issued our opinion in Allstate, which substantially clarifies
Section 18.001 practice. Shortly thereafter, Defendants moved the trial
court to reconsider its order. The trial court denied the motion without
stating its grounds, and a divided court of appeals denied Defendants’
petition for writ of mandamus. ___ S.W.3d ___, 2022 WL 619680, at *1
(Tex. App.—Houston [14th Dist.] Mar. 3, 2022). Defendants now seek
mandamus relief in this Court.
II. Discussion
A party is entitled to mandamus relief if the trial court clearly
abused its discretion and the party lacks an adequate remedy at law. In
re Gonzales, 619 S.W.3d 259, 261 (Tex. 2021). A trial court abuses its
discretion if it fails to apply a statutory requirement properly because
courts have no discretion in determining what the law is or applying it
to facts. Id. Here, the issue is whether the trial court properly applied
Civil Practice and Remedies Code Section 18.001, which relates to
proving the reasonableness of expenses a claimant seeks to recover.
A. Abuse of Discretion
Generally, parties seeking to recover past medical expenses must
prove that the amounts they paid or incurred are reasonable. Allstate,
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622 S.W.3d at 87. Unless claimants avail themselves of the procedures
outlined in Section 18.001, they must present expert testimony at trial
to establish that their medical expenses are reasonable and necessary.
Id. This is true even if the amount is undisputed. Id.
Section 18.001, however, allows claimants to present such
evidence by an uncontroverted affidavit that complies with the statute.
See TEX. CIV. PRAC. & REM. CODE § 18.001(b). To qualify, the affidavit
must be prepared by the person who provided the medical services or
the person in charge of the records showing that the claimant received
the services and incurred the charges. Id. § 18.001(c). An
uncontroverted affidavit under Section 18.001(b) is sufficient evidence—
but not conclusive—that medical expenses are reasonable and
necessary. Allstate, 622 S.W.3d at 881. At trial, defendants may still
challenge—through evidence and argument—a claimant’s assertion
that medical expenses are reasonable or necessary. Id.
Section 18.001 also provides defendants a means to controvert the
claimant’s affidavit. In particular, a defendant can serve the claimant
with a counteraffidavit that provides reasonable notice of the basis on
which the defendant intends to controvert the reasonableness and
necessity of the proffered medical expenses at trial. TEX. CIV. PRAC. &
REM. CODE § 18.001(f). The counteraffiant must be “qualified, by
knowledge, skill, experience, training, education, or other expertise, to
testify in contravention of all or part of any of the matters contained in
the initial affidavit.” Id. In the face of a compliant counteraffidavit, the
claimant may not reach the jury on the reasonableness and necessity of
her medical expenses without expert testimony. In effect, the claimant’s
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evidentiary burden on that issue is the same as if the initial affidavit
had never been served. Allstate, 622 S.W.3d at 877.
Defendants argue that the trial court clearly abused its discretion
by striking Dr. Sanchez’s counteraffidavit and testimony because the
affidavit comports with Section 18.001(f)’s requirements. In response,
Estrada argues that the counteraffidavit contains prohibited challenges
to causation, fails to provide reasonable notice, and is unreliable. 1
As noted, in Allstate we clarified many aspects of Section 18.001
practice, including what constitutes “reasonable notice” of the
defendant’s basis for controverting the initial affidavit’s claims and
whether the opinions expressed in a counteraffidavit must meet the
standards for admissibility at trial. 622 S.W.3d at 877-80. In that case,
Alaniz sued her insurer for failing to pay her underinsured motorist
benefits. Id. at 873. Alaniz provided affidavits indicating she had
incurred approximately $41,000 in reasonable and necessary medical
expenses. Id. The insurer offered a counteraffidavit from a registered
nurse with twelve years of medical billing review experience. Id. at 873-
74. Alaniz moved to strike the counteraffidavit, arguing in pertinent
part that it did not give reasonable notice of the basis of its conclusions
and the nurse’s opinions were unreliable. Id. at 874. We disagreed on
both points. Id. at 879-80.
Addressing Section 18.001(f)’s “reasonable notice” requirement,
we held that satisfaction of this requirement does not hinge on the
admissibility of the counteraffiant’s testimony. 622 S.W.3d at 879.
1 Estrada does not claim Dr. Sanchez is unqualified to testify.
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Rather, the trial court must determine whether the counteraffidavit
allows the claimant to understand “the nature and basic issues in
controversy and what testimony will be relevant,” such that the
claimant has “sufficient information to enable that party to prepare a
defense or a response.” Id.
Applying these principles here, we hold that Dr. Sanchez’s
counteraffidavit provides Estrada with the reasonable notice the statute
requires. The counteraffidavit assesses the treatment Estrada received.
Where Dr. Sanchez believes that Estrada received medically
unnecessary treatment, Dr. Sanchez outlines the basis for his opinion.
Where he believes that Estrada’s treatment was medically necessary
but billed at an inflated rate, Dr. Sanchez explains what data he used to
formulate that opinion. If, as Estrada contends, the data Dr. Sanchez
used to calculate a reasonable cost is unreliable, Estrada can make that
argument either on a motion to exclude the testimony under E.I. du Pont
de Nemours & Co. v. Robinson, 923 S.W.2d 549, 556 (Tex. 1995), or at
trial on cross-examination. See Allstate, 622 S.W.3d at 880.
Estrada further argues that Dr. Sanchez’s counteraffidavit
impermissibly challenges causation and was thus properly stricken.
However, a counteraffidavit’s inclusion of an opinion on causation has
no bearing on its validity under Section 18.001(f). True, the statute
expressly provides that “[t]he counteraffidavit may not be used to
controvert the causation element of the cause of action.” TEX. CIV. PRAC.
& REM. CODE § 18.001(f). But that does not mean that the presence of a
causation opinion in an otherwise compliant counteraffidavit renders
either the counteraffidavit or the opinion invalid; rather,
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Section 18.001(f) simply clarifies that the causation opinion is not
admissible solely by virtue of its inclusion in the counteraffidavit. Thus,
provided that the counteraffidavit complies with Section 18.001(f), the
counteraffidavit’s mere inclusion of a causation opinion is not a proper
basis for striking it. 2
In sum, Dr. Sanchez’s counteraffidavit easily satisfies
Section 18.001(f)’s requirements, particularly in light of Allstate. As a
result, the trial court clearly abused its discretion in striking the
affidavit and Dr. Sanchez’s testimony. 3
B. No Adequate Remedy by Appeal
In addition to showing an abuse of discretion, a party seeking
mandamus relief must demonstrate that it lacks an adequate remedy by
ordinary appeal. Walker v. Packer, 827 S.W.2d 833, 842 (Tex. 1992).
Appellate review is inadequate when an erroneous discovery order
vitiates or severely compromises a party’s ability to present a viable
claim or defense at trial. Id. at 843.
2We express no opinion on the merits of any challenge to the ultimate
admissibility of the causation testimony in Dr. Sanchez’s counteraffidavit.
3 Estrada further argues that Defendants are not entitled to mandamus
relief because they waited almost a year to seek reconsideration of and
mandamus relief from the trial court’s order. Estrada did not complain about
Defendants’ timeliness in either the trial court or the court of appeals, and, in
any event, the argument is meritless. Defendants sought reconsideration and
then mandamus relief shortly after we issued our opinion in Allstate, which
firmly establishes that the trial court’s original order striking Dr. Sanchez’s
counteraffidavit and testimony was erroneous. Seeking reconsideration—and
when that failed, mandamus relief—in light of a significant, on-point opinion
from the state’s civil court of last resort is hardly dilatory.
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In Allstate, we held that Allstate lacked an adequate appellate
remedy where the order striking its counteraffidavit (1) allowed the
claimant to avoid presenting expert testimony to support a finding of the
reasonableness of her medical expenses, (2) excluded the
counteraffiant’s testimony on any issue, and (3) prohibited Allstate from
challenging the reasonableness of the claimant’s medical expenses at
trial. 622 S.W.3d at 883 (holding that the order “would preclude Allstate
from engaging in meaningful adversarial adjudication of [plaintiff’s]
claim for payment of medical expenses, vitiating or severely
compromising Allstate’s defense”). Estrada argues that the order here
is narrower than the one at issue in Allstate because it does not include
the wholesale prohibition against challenging the reasonableness of his
medical expenses at trial. Defendants respond that the order’s effect is
the same because “[i]t prevents Defendants’ only retained expert from
testifying” about either the reasonableness of Estrada’s medical costs or
the medical necessity of the treatment he received.
We agree with Defendants that, if the order effectively forecloses
them from presenting expert testimony at trial to challenge the
reasonableness and necessity of Estrada’s medical expenses,
Defendants’ ability to present a defense has been severely compromised
and they in turn lack an adequate appellate remedy. See In re Kings
Ridge Homeowners Ass’n, 303 S.W.3d 773, 786 (Tex. App.—Fort Worth
2009, orig. proceeding) (holding that the relator lacked an adequate
remedy by appeal where the trial court struck its expert designation as
untimely and the expert would have testified on matters essential to its
claims); Beamon v. O’Neill, 865 S.W.2d 583, 585 (Tex. App.—Houston
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[14th Dist.] 1993, orig. proceeding) (holding, in a personal-injury suit,
that the defendants lacked an adequate remedy by appeal from the trial
court’s order striking their expert-witness designations as untimely
where the “experts were to testify on key rebuttal issues such as the
cause of the injury and damages”).
Estrada’s petition reflects that discovery in this case was to be
conducted under a Level 3 discovery control plan, meaning that the
discovery plan was to be “tailored to the circumstances of the specific
suit” by court order. TEX. R. CIV. P. 190.4(a). Although the discovery
control plan is not in the mandamus record, on June 24, 2022, we
granted an emergency motion to stay the trial that had been reset for
July 2022. Any extended deadline to designate experts necessarily
passed before that date. Therefore, the trial court’s order effectively
forecloses Defendants from presenting expert testimony at trial on key
rebuttal issues, including the reasonableness and necessity of Estrada’s
medical expenses.
III. Conclusion
The trial court clearly abused its discretion by striking Dr.
Sanchez’s counteraffidavit and testimony, and Defendants lack an
adequate remedy to address this error by appeal. As a result, without
hearing oral argument, we conditionally grant Defendants’ petition for
writ of mandamus and order the trial court to vacate its order striking
Dr. Sanchez’s counteraffidavit and testimony. TEX. R. APP. P. 52.8(c).
Our writ will issue only if the trial court fails to comply.
OPINION DELIVERED: April 21, 2023
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