EBT in aid of arbitration? No dice.

Matter of Travelers Indem. Co. v United Diagnostic Imaging, P.C., 2010 NY Slip Op 03944 (2d Dept. 2010)

“The test for ordering disclosure to aid in arbitration is “necessity,” as opposed to “convenience” (Hendler & Murray v Lambert, 147 AD2d 442, 443 [internal quotation marks omitted]). Thus, court-ordered disclosure to aid in arbitration is justified only where that relief is “absolutely necessary for the protection of the rights of a party” to the arbitration (Hendler & Murray v Lambert, 147 AD2d at 443 [internal quotation marks omitted]). [*2]

Here, the petitioner already has evidence sufficient to establish a potential defense in the arbitration proceedings (cf. 11 NYCRR 65-1.1[d], 65-3.2[c], 65-3.5[b], [c], [e]). Furthermore, the petitioner can potentially obtain the requested disclosure in the context of those proceedings (see 11 NYCRR 65-4.5[o][2]; cf. Matter of Katz [Burkin], 3 AD2d 238, 238-239). Finally, the record provides no indication that if a disclosure directive is made during those proceedings, the requested disclosure will, at that point, be unavailable (cf. Bergen Shipping Co., Ltd. v Japan Marine Servs., Ltd., 386 F Supp 430, 435 n 8). Under the circumstances, the petitioner failed to demonstrate the existence of extraordinary circumstances justifying court-ordered disclosure to aid in those proceedings. Accordingly, the Supreme Court improvidently exercised its discretion in granting the petition.”

The Appellate Division seems to be continuing its cruisade to insulate the arbitration forum from any collateral attack.  Travelers Indem. Co. v. United Diagnostic Imaging, P.C., 70 A.D.3d 1043 (2d Dept. 2010); Mercury Cas. Co. v. Healthmakers Medical Group, P.C., 67 A.D.3d 1017 (2d Dept. 2010).

Also, look at the the regulagtory provisions that were delimited by a “c.f.” cite: 65-3.2(c) “Do not demand verification of facts unless there are good reasons to do so. When verification of facts is necessary, it should be done as expeditiously as possible.”; 65-1.1(d) “[Claimant shall] provide any other pertinent information that may assist the Company in determining the amount due and payable.”; 65-3.5 (allowing verification via EUO under the tight claims determinative time frames).

It appears that this might have been a Mallela case, and the Court was not willing to allow the same type of discovery in arbitral proceedings that it would allow in plenary actions.  Compare, One Beacon Ins. Group, LLC v. Midland Medical Care, P.C., 54 A.D.3d 738 (2d Dept. 2008).

Also, note the purported ability to obtain discovery through the arbitration proceeding itself.  We saw this doctrine enunciated in another context a few years  ago.  In re Progressive Northeastern Ins. Co. (New York State Ins. Fund),  56 A.D.3d 1111 (3d Dept. 2008).  Yet, should the arbitrator refuse to grant you the sought after discovery, you are probably out of luck.  See, Mercury Cas. Co. v. Healthmakers Medical Group, P.C..

Finally, without knowing what the proofs were in this matter, I cannot say that I necessarily agree or disagree with the outcome of the ultimate disposition of the case.  I take issue, however, with the court denying discovery on the basis that the information could have been obtained during the claims determination phase, inasmuch as broad discovery is usually allowed where true coverage issues or non-precludable standing issues arise.

Does this make sense?

A.B. Med. Servs., PLLC v New York Cent. Mut. Fire Ins. Co., 2010 NY Slip Op 50702(U)(App. Term 2d Dept. 2010)

“Plaintiffs’ prior action was dismissed pursuant to CPLR 3126 (3), but the dismissal order did not state that the dismissal was with prejudice, nor does a review of the record reveal the existence of a preclusion order. Consequently, plaintiffs were not barred from [*2]commencing a second action. Accordingly, the District Court properly denied defendant’s pre-answer motion to dismiss the complaint based on the doctrine of res judicata.”

If the striking of a complaint is such an extreme remedy, only available upon the willful and contumacious behavior of the plaintiff, then why does it carry  less of a sanction than preclusion?  Secondly, would we have had the same outcome had an answer been stricken?  Do we have a 14th Amendment issue?  Interesting.

Miss an EBT deadline – have your answer stricken and go directly to inquest

Bernal v Singh, 2010 NY Slip Op 03053 (2d Dept. 2010)

“It is settled that the nature and degree of the penalty to be imposed pursuant to CPLR 3126 lies within the sound discretion of the Supreme Court (see CPLR 3126[3]; Joseph v Iannace, 6 AD3d 502, 503; Ordonez v Guerra, 295 AD2d 325, 326; Yona v Beth Israel Med. Ctr., 285 AD2d 460, 461). The record herein supports the Supreme Court’s determination that the defendants’ failure to appear for depositions on June 5, 2009, was willful and contumacious (see Beneficial Mortg. Corp. v Lawrence, 5 AD3d 339, 340; Rowell v Joyce, 10 AD3d 601). The attorneys for both sides had agreed upon that date at a compliance conference on June 1, 2009, just four days earlier, and the resulting compliance conference order had directed the depositions to proceed on that date starting at 10:00 A.M. in the courthouse.”

I am not sure how many previous orders were violated, but the extreme penalty of putting a defendant in default under the circumstances as presented in this opinion seems quite drastic.

Unintentional spoliation leads to adverse inference charge

Seda v Epstein, 2010 NY Slip Op 02850 (1st Dept. 2010)

“There is no evidence that defendants’ removal of the debris was willful; indeed, the preliminary conference order merely stated that defendants were to make the premises available for inspection, and plaintiff did not [*2]schedule an inspection for more than two years (see e.g. Jimenez v Weiner, 8 AD3d 133 [2004]). However, in view of defendants’ failure to notify plaintiff’s counsel of the intended removal, the court properly ordered the lesser sanction of an adverse inference charge (see e.g. Balaskonis v HRH Constr. Corp., 1 AD3d 120, 121 [2003]).”

I am not sure when in no-fault practice this particular issue would arise.  It is something to keep in mind if you are fighting a contested  issue where substantive discovery has been ordered and the items you seek to discover suddenly “vanish”.

An interesting discovery case involving the right to obtain alcohol treatment records

Once a month, the Fourth Department usually barrages us with about 100 or so decisions.  The hard part is sifting through them quickly enough and finding the ones that are worth posting.  The next few posts will be from the Appellate Department that specializes in short opinions, the use of the “memorandum” and which always fails to award a bill of costs to the prevailing party on appeal.

L.T. v Teva Pharms. Usa, Inc., 2010 NY Slip Op 02201 (4th Dept. 2010)

This case is interesting because it explicitly allows certain discovery if medical texts or journals support the medical proposition that the defendant is espousing.  Here are the pertinent parts of the opinion:

“Plaintiff suffers from tardive dyskinesia (TD) and alleges that it was caused by her use of defendant’s medication to treat her gastroesophageal disease. All of the articles submitted by defendant link alcohol abuse or dependency to TD only for psychiatric patients who are concomitantly using antipsychotic or neuroleptic medications. The record contains no evidence that plaintiff ever used such medication or, indeed, that she ever suffered from a psychiatric condition, and thus defendant failed to establish a link between plaintiff’s alleged alcohol abuse or dependency in the 1990s and plaintiff’s having developed TD in 2007 (cf. Napoleoni v Union Hosp. of Bronx, 207 AD2d 660; see generally Manley v New York City Housing Auth., 190 AD2d 600, 600-601).

Defendant contends that antipsychotic medications are sometimes used to treat alcoholics suffering from withdrawal and thus that discovery is warranted because it is possible that plaintiff was prescribed such antipsychotic medications while being treated for her alcohol use. That contention is not properly before us, however, because it is raised for the first time on appeal (see generally CPLR 5501 [a]; Ciesinski v Town of Aurora, 202 AD2d 984, 985). In any event, the record contains no evidence that plaintiff was ever prescribed such medication and thus does not support defendant’s contention.

While the record does not justify the disclosure of the confidential alcohol treatment records, we agree with defendant that it should be allowed to provide expert witness affidavits and/or “medical texts and journals” establishing a link between alcohol abuse and the development of TD where the person suffering from TD was not a psychiatric patient being treated with antipsychotic or neuroleptic medication (Green v City of New York, 281 AD2d 193, 193). We thus conclude at this juncture that the court properly denied plaintiff’s cross motion for a protective order, and we modify the order by denying defendant’s motion without prejudice and vacating the directive that plaintiff provide defendant with HIPAA compliant authorizations permitting release of her alcohol treatment records.”

Appellate Term holds CPLR 3212(f) relief is inappropriate under three separate circumstances

Bath Med. Supply, Inc. v Allstate Indem. Co., 2010 NY Slip Op 20059 (App. Term 2d Dept. 2010)

First, the Appellate Term, Second Department, appears to have, for the first time that  I can recall, denied a 3212(f) application when the defense is based upon a corporate structure issue.  The court found it relevant that many of the corporate documents, which the 3212(f) defense was based upon, are readily available.

Second, the portion of the 3212(f) application, which was based upon the purported need for an EBT of the assignor based upon an allegation that the assignor received the supplies, was denied since the defense may have been precluded.

Third, even if the defense was not precluded, a deposition of the assignor without a subpoena, as we know, is palpably improper.

“The court denied plaintiff’s motion for summary judgment pursuant to CPLR 3212 (f) on the ground that defendant was entitled to discovery pertaining to its contention that plaintiff had billed insurance companies for medical supplies which were never provided. However, defendant failed to make any showing that its denial of claim forms were timely mailed and that it is not precluded from raising fraudulent billing as a defense (see Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556 [2008]; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 282 [1997]). Consequently, the court’s determination that discovery was necessary to obtain facts relevant to this precluded defense was improper, and, thus, plaintiff’s motion for summary judgment should not have been denied on that basis.

A defense that plaintiff may be ineligible to recover no-fault benefits because it failed to adhere to applicable statutes (cf. State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]) is not precluded, notwithstanding defendant’s failure to demonstrate that its denial of claim forms were timely sent. However, defendant has offered no factual basis for its contention that plaintiff was not properly incorporated as a provider of durable medical equipment or failed to obtain any license that may have been required at the time it delivered medical equipment to its assignor. Further, in light of the availability of public records documenting plaintiff’s licensing status, defendant “failed to demonstrate that discovery was needed in order to show the existence of a triable issue of fact (see CPLR 3212 [f])” (Delta Diagnostic Radiology, P.C. v Interboro Ins. Co., 25 Misc 3d 134[A], 2009 NY Slip Op 52222[U] [App Term, 2d, 11th & 13th Jud Dists 2009]; see also Corwin v Heart Share Human Servs. of NY, 66 AD3d 814, 815 [2009] [summary judgment should be deferred pending discovery only when the opponent “offer[s] an evidentiary basis to suggest that discovery might lead to relevant evidence and that facts essential to justify opposition to the motion were exclusively within the knowledge and control of the plaintiff”]).”

We note that, insofar as the order conditioned the grant of defendant’s cross motion on the nonappearance of plaintiff’s assignor for an examination before trial, the order was improper. As plaintiff’s assignor is neither a party to this action nor under plaintiff’s control (Leon v Martinez, 84 NY2d 83, 88 [1994]; Cardtronics, LP v St. Nicholas Beverage Discount Ctr., Inc., 8 AD3d 419, 420 [2004]; 6A NY Jur 2d, Assignments §§ 59, 85), the sanctions provided by CPLR 3126 (3) for nondisclosure cannot be imposed on plaintiff for failing to produce its assignor for an examination before trial (MIA Acupuncture, P.C. v Mercury Ins. Co., ___ Misc 3d ___, 2009 NY Slip Op 29509 [App Term, 2d, 11th & 13th Jud Dists 2009]).

The fifth discovery default will cause your answer to be stricken

Rodriguez v United Bronx Parents, Inc., 2010 NY Slip Op 01366 (1st Dept. 2010):

“Order, Supreme Court, Bronx County (Howard R. Silver, J.), entered August 26, 2009, which, to the extent appealed from, granted plaintiff’s cross motion pursuant to CPLR 3126 to strike defendant’s answer solely to the extent of granting plaintiff a missing witness charge as to Nadia James and Victor Martinez, unanimously modified, on the law and the facts, the cross motion to strike granted….”

“Here, plaintiff established that defendant’s failure to comply was willful and contumacious, given its repeated and persistent failure to comply with five successive disclosure orders (see Goldstein v CIBC World Mkts. Corp. 30 AD3d 217 [2006]; Min Yoon v Costello, 29 AD3d 407 [2006]; compare Pascarelli v City of New York, 16 AD3d 472 [2005]). Defendant’s failure to adequately explain what efforts were made to locate the documents it failed to disclose, or to explain its inability to provide the last known addresses of its former residents or employees, also supports a finding that its failure to comply was willful. Furthermore, defense counsel’s “Affirmation of Search” did not indicate whether he was the custodian of defendant’s records, what records were searched, who conducted the search, what the search consisted of, and the statement was made upon “information and belief.” Accordingly, this statement is devoid of detail and insufficient.”

After the fifth time that defendant stonewalled the plaintiff, the Supreme Court granted plaintiff a missing witness charge.  The Appellate Division was unimpressed and, upon Defendant’s appeal, struck the Defendant’s complaint.

The improper filing of a Note of Issue in Central New York will cost you more than the $30 or $125 you paid to file that Note of Issue

Ikeda v Tedesco, 2010 NY Slip Op 01283 (4th Dept. 2010)

“We reject plaintiff’s contention that, pursuant to CPLR 3402, a party may file a note of issue and certificate of readiness “at any time after issue is first joined . . . .” Pursuant to 22 NYCRR 202.21 (a) and (b), a properly filed note of issue must be accompanied by a certificate of readiness, and there must be “no outstanding requests for discovery” (22 NYCRR 202.21 [b] [8]). Here, plaintiff filed the note of issue and certificate of readiness before she had provided the release in accordance with the [*2]order granting defendants’ motion to compel her to do so. Thus, the court properly granted that part of defendants’ motion to strike the note of issue and certificate of readiness (see 22 NYCRR 202.21 [e]). We agree with plaintiff, however, that the court erred in failing to comply with 22 NYCRR 130-1.2 in imposing the attorney fees as a sanction inasmuch as the court failed to set forth in a written decision “the conduct on which . . . the imposition [of sanctions] is based, the reasons why the court found the conduct to be frivolous, and the reasons why the court found the amount . . . imposed to be appropriate” (see Leisten v Leisten, 309 AD2d 1202, 1203; see also Campbell v Obear, 26 AD3d 877, 878). We therefore modify the order by vacating the award of attorney fees, and we remit the matter to Supreme Court for compliance with 22 NYCRR 130-1.2.”

A sanction hearing for something that happens in so many personal injury actions here in downstate New York?  The world of upstate practice.

Note to attorney: resist the urge to object if your client is being deposed as a non-party at a deposition

I am going to copy and paste what I think is the pertinent portion of the decision in Thompson v Mather, 2010 NY Slip Op 01239 (4th Dept. 2010):

“In its order deciding the motion, Supreme Court directed that plaintiff and defendants are to “consider providing general releases to the [physicians] . . . with respect to their initial treatment of [plaintiff]” and that, if such releases are provided, plaintiff will “be entitled to have a videotaped deposition of [the physicians] during which deposition the attorneys for the [physicians] shall not be permitted to speak . . . .” The order further provided that, if the general releases are not provided, then the attorneys for the parties and the physicians “shall seek to work out ground rules for a non-party deposition” of the physicians. The order then provided that, if the attorneys are unable to “work out ground rules,” plaintiff will not be entitled to take the videotaped depositions of the physicians and they “are to be subpoenaed to testify” at trial.

We agree with plaintiff that counsel for a nonparty witness does not have a right to object during or otherwise to participate in a pre-trial deposition. CPLR 3113 (c) provides that the examination and cross-examination of deposition witnesses “shall proceed as permitted in the trial of actions in open court.” Although counsel for the physicians correctly conceded at oral argument of plaintiff’s motion in Supreme Court that she had no right to object during or to participate in the trial of this action, she nevertheless asserted that she was entitled to object during nonparty depositions and videotaped deposition questioning. We cannot agree that there is such a distinction, based on the express language of CPLR 3113 (c). Indeed, we discern no distinction between trial testimony and pre-trial videotaped deposition testimony presented at trial. We note in addition that 22 NYCRR 202.15, which concerns videotaped recordings of civil depositions, refers only to objections by the parties during the course of the deposition in the subdivision entitled “Filing and objections” (see 22 NYCRR 202.15 [g] [1], [2]). We thus conclude that plaintiff is entitled to take the videotaped depositions of the physicians and that counsel for those physicians is precluded from objecting during or otherwise participating in the videotaped depositions.

Lastly, we note that the practice of conditioning the videotaping of depositions of nonparty witnesses to be presented at trial upon the provision of general releases is repugnant to the fundamental obligation of every citizen to participate in our civil trial courts and to provide truthful trial testimony when called to the witness stand. Contrary to nonparty respondents’ contention, the fact that the statute of limitations has not expired with respect to a nonparty treating physician witness for the care that he or she provided to a plaintiff provides no basis for such a condition.”

Here is what this case says: 1) If you are a non-party at a deposition, then your attorney cannot say anything.  It is similar to when your client testifies before a grand jury in New York.  You as an attorney can sit there, but you cannot utter a peep.  2) A court, in this type of situation, must unconditionally compel a witness with knowledge of the facts to testify at a deposition.  3) I also think this case represents the reason behind the enactment of CPLR Sec. 3117(a)(4).  But see, S.J. Pahng, M.D., P.C. v. Progressive Northeastern Ins. Co., 20 Misc.3d 137(A)(App. Term 2d Dept. 2007).

Compelled to give blood

We see here an interesting case where a defendant is forced to undergo a somewhat invasive test.  The Court was steadfast in its holding in Welter v Feigenbaum , 2010 NY Slip Op 00012 (1st Dept 2010) that a test ordered during litigation is exempt from the 3121 privilege.  This is a very interesting case when dealing with certain issues involving no-fault’s big sister, 5102(d) litigation.

“A plaintiff, in an action for negligent transmittal of genital herpes simplex II, may demand that the defendant submit to a blood test to determine if the latter indeed has the virus (see CPLR 3121). Since the test was ordered in conjunction with the litigation, it is not subject to the physician-patient privilege (see Connors, McKinney’s CPLR Practice Commentary C3121:2). Even were the privilege to apply, defendant waived it by asserting the affirmative defense that he was asymptomatic (see e.g. Dillenbeck v Hess, 73 NY2d 278, 287-288 [1989]).”