Business Law

Board of Registered Nursing v. Superior Court (Jan. 15, 2021, D077441) __ Cal.App.5th __ [2021 WL 140893]

Privacy rights mostly foreclose litigation discovery of non-party health care professionals’ administrative records and other non-public records maintained by State agencies.

The State of California sued various pharmaceutical companies, alleging that their false and misleading marketing scheme was designed to minimize the risks of opioid medications, which have caused a public health crisis by dramatically increasing opioid use, abuse, and deaths. The State alleged violations of the False Advertising Law (Bus. & Prof. Code, § 17500 et seq.), the Unfair Competition Law (id., § 17200 et seq.), and the public nuisance statutes (Civ. Code, §§ 3479–3480), and sought declaratory and injunctive relief, as well as civil penalties. During the case, the defendants served business record subpoenas on four nonparty agencies: the Nursing Board, the Pharmacy Board, the Medical Board, and the California DOJ. Defendants demanded documents in sweepingly broad categories related to opioid medications, prescriptions, overdoses, and disciplinary proceedings. Defendants aimed to rebut the State’s theory that their marketing practices caused the opioid crisis by pointing the finger, instead, at misbehaving healthcare professionals and state agencies that failed to monitor or discipline health care professionals who abused or overprescribed opioids.

The trial court ordered the agencies to produce documents in response to defendants’ subpoenas, including (1) administrative records of disciplinary proceedings against providers related to opioid prescriptions; (2) investigatory files of complaints against providers related to opioid prescriptions; (3) coroner reports of opioid-related deaths that may have involved physician negligence or incompetence (Bus. & Prof. Code, § 802.5); and (4) hundreds of millions of prescription records for opioids, anti-depressants, and certain other drugs in California, as reflected in the Controlled Substance Utilization Review and Evaluation System (CURES) database maintained by the DOJ (Health & Saf. Code, § 11165). The trial court allowed the redaction of some personal identifying information contained in these documents and records. The agencies sought writ relief.

The Court of Appeal granted writ relief, holding that the trial court abused its discretion in at least four respects: (1) the defendants were required to serve consumer notices on (at least) the doctors, nurses, pharmacists, and other health care professionals whose identities would be disclosed in the administrative records, investigatory files, and coroner reports; (2) the requests for complete administrative records and investigatory files, as well as millions of CURES records, were overbroad; (3) the requests for complete administrative records and investigatory files ran afoul of the constitutional right to privacy and the statutory official information and deliberative process privileges; and (4) the defendants’ motion to compel discovery from the Pharmacy Board and the Medical Board was untimely.

The court rejected the defendants’ argument that the Information Practices Act of 1977 (IPA; Civ. Code, § 1798 et seq.) allowed agencies to comply with the subpoenas without consumer notice, explaining that “the IPA and the consumer notice provisions work together to maximize the privacy protection afforded to persons whose personal information is implicated” and there is “no conflict between the statutory schemes that would require one statute to supersede the other.” The court further explained that information in agency investigatory files, administrative records, and CURES data were protected by the official information privilege, the deliberative process privilege, and the right to privacy. The court emphasized the importance of the right to privacy “for those professionals who were investigated but never accused of wrongdoing”; disclosing their personal information “would constitute a serious invasion of the privacy rights of these health care professionals.” Finally, the court rejected the State’s claim that robust statutory confidentiality provisions prohibited discovery of all information in the CURES database, but held that the defendants had failed to justify the disclosure of those records in light of the information the State had already produced.

The bulletin describing this appellate decision was originally prepared for the California Society for Healthcare Attorneys (CSHA) by H. Thomas Watson and Peder K. Batalden, Horvitz & Levy LLP, and is republished with permission.

For more information regarding this bulletin, please contact H. Thomas Watson, Horvitz & Levy LLP, at 818-995-0800 or htwatson@horvitzlevy.com.

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