The United States of America et al v. Safeway, Inc.
Filing
191
OPINION BY RICHARD MILLS, United States District Judge: The Appeal of United States Magistrate Judge's Decision (d/e 149 ) is DENIED. The Court AFFIRMS and ADOPTS the Opinion and Order (d/e 147 ) of United States Magistrate Judge Tom Schanzle-Haskins denying Defendant Safeway, Inc.'s motion to compel. SEE WRITTEN OPINION. Entered on 12/27/2019. (MJC, ilcd)
E-FILED
Friday, 27 December, 2019 12:40:18 PM
Clerk, U.S. District Court, ILCD
IN THE UNITED STATES DISTRICT COURT
FOR THE CENTRAL DISTRICT OF ILLINOIS
SPRINGFIELD DIVISION
UNITED STATES OF AMERICA, and The
STATES OF CALIFORNIA, COLORADO,
DELAWARE, HAWAII, ILLINOIS, ILLINOIS,
MARYLAND, MONTANA, NEW JERSEY,
NEW MEXICO, NEVADA, VIRGINIA, and
The DISTRICT OF COLUMBIA, ex rel.
THOMAS PROCTOR,
Plaintiffs,
v.
SAFEWAY INC.,
Defendant.
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
Case No. 11-cv-3406
OPINION
RICHARD MILLS, United States District Judge:
United States Magistrate Tom Schanzle-Haskins entered an Opinion and
Order [d/e 147] denying the Defendant’s Motion to Compel.
In accordance with 28 U.S.C. § 636(b)(1)(A) and Federal Rule of Civil
Procedure 72(a), Defendant Safeway Inc. has appealed [d/e 149] the magistrate
judge’s Opinion and Order.
I.
Judge Schanzle-Haskins denied the Defendant’s motion to compel the Centers
for Medicare and Medicaid Services (CMS) to permit the testimony of a former
1
employee, Cynthia Tudor, Ph.D. Dr. Tudor is a former Director of CMS and former
Director of the Medicare Drug Benefit and C&D Data Group. Federal regulations
require agency authorization before an employee or former employee of CMS may
testify concerning information acquired in the course of performing official duties.
See 45 C.F.R. §§ 2.1-2.6 (“Touhy regulations”).1 CMS denied the Defendant’s
request. The Defendant sought judicial review of CMS’s decision.
The magistrate judge noted that CMS determined that allowing Dr. Tudor to
testify about the deposition topics would not promote the objectives of the
Department of Health and Human Services (“the Department”) for three reasons: (1)
CMS representatives talked to employees who worked most closely with Dr. Tudor
and determined that she may lack personal knowledge about the topics on which
Safeway wanted her to testify; (2) the deposition topics seemed calculated to elicit
opinions rather than facts based on personal knowledge; and (3) testimony on the
deposition topics posed a risk of disclosure of information protected by the
deliberative process privilege or the attorney-client privilege.
Regarding CMS’s first reason, the magistrate judge noted that after “learning
from these employees that Dr. Tudor had limited knowledge on the Deposition
1
In United States ex rel. Touhy v. Ragen, 340 U.S. 462 (1951), the Supreme Court determined that a
federal employee cannot be compelled to obey a subpoena that acts against valid agency regulations.
2
Topics, CMS could reasonably conclude that Dr. Tudor’s proposed testimony would
not promote the objectives of the Department.”
As for the second reason, the magistrate judge found that “CMS also
reasonably determined that the Deposition Topics posed the risk that Dr. Tudor
would provide opinions in her deposition, noting that Safeway had already said that
Dr. Tudor had the expertise to “educate the finder of fact” on complicated issues that
were “outside the scope of knowledge of most juries and judges.” The magistrate
judge observed that this description of Dr. Tudor’s proposed testimony was similar
to the language used in Federal Rule of Evidence 702(a), which discusses the
purpose of expert testimony, and determined that “CMS could reasonably conclude
that allowing a former employee to opine on such matters would not promote the
objectives of the Department.”
With respect to the third reason, the magistrate judge found that “CMS also
reasonably determined that the testimony would create a risk that Dr. Tudor would
disclose privileged information, and that creating such a risk would not promote the
objectives of the Department.” Moreover, “CMS could reasonably conclude that
disclosure of decision-making information concerning the development and
implementation of the Lower Cash Price Policy could put at risk the disclosure of
confidential information protected by these two privileges.”
3
Based on those considerations, the magistrate judge found that “the decision
by CMS that the proposed testimony did not promote the objectives of the
Department [is] rational and [is] not arbitrary and capricious.” The magistrate judge
noted that the Court’s role is not to “substitute its judgment for CMS,” but only to
determine “whether CMS provided a reasonable basis for its decision.”
The magistrate judge determined that CMS’s decision was not arbitrary and
capricious. Under § 636(b)(1)(A) and Rule 72(a), the Court may reconsider the
magistrate judge’s order if it is “clearly erroneous” or “contrary to law.”
Safeway objects to the magistrate judge’s order, claiming that (1) Dr. Tudor
has personal knowledge of the Memo she wrote and for which CMS continues to
hold her out as the author on its website; (2) whether Dr. Tudor provided opinion
testimony rather than fact testimony during her deposition would be a question of
admissibility at trial, and her deposition testimony would be potentially admissible
based on her background and experience; and (3) CMS has not provided any reason
for why the narrow topics in Safeway’s Touhy request risk eliciting privileged
testimony, especially given that the Government has a right to attend the deposition.
The magistrate judge reasonably determined that CMS had a legitimate basis
for questioning the extent of Dr. Tudor’s personal knowledge of the memorandum,
given that she acknowledged in a filing in the related case that the memorandum
4
“had been authored by members of Dr. Tudor’s staff.” See United States ex rel.
Schutte et al. v. SuperValu et al., Case No. 3:11-cv-3290, Doc. No. 279, at 2.
The magistrate judge also reasonably determined that CMS’s concern about
eliciting opinion testimony from Dr. Tudor was legitimate, based on Safeway’s
description of the proposed testimony which, in a November 16, 2018 letter from its
counsel, was generally consistent with the Federal Rule of Evidence which addresses
the purpose of expert testimony.
Additionally, the magistrate judge reasonably found CMS had a legitimate
basis to have concerns that Dr. Tudor would disclose privileged information and that
creating such a risk would not promote the objectives of the Department. This is
based on Safeway’s statements in the letter about the formulation of policy and the
disclosure of decision-making information.
“The clear error standard means that the district court can overturn the
magistrate judge’s ruling only if the district court is left with the definite and firm
conviction that a mistake has been made.” Weeks v. Samsung Heavy Industries Co.,
Ltd., 126 F.3d 926, 943 (7th Cir. 1997). The Court has no basis to make such a
determination. In short, the magistrate judge noted that CMS had multiple reasons
for determining that the proposed testimony did not promote the objectives of the
Department. The proffered reasons were rational and not arbitrary and capricious.
5
Accordingly, the magistrate judge’s Opinion and Order is not “clearly erroneous” or
“contrary to law.”
II.
Alternatively, Safeway claims that if the Court finds that CMS’s decision not
to allow Dr. Tudor to testify was not arbitrary and capricious, the Court should
instruct the jury in this case that it can draw an adverse inference from CMS’s
refusal. The Court does not believe that adverse inference instruction would be
appropriate. When Dr. Tudor’s testimony was sought, CMS was authorized under
the regulations to determine whether “after consultation with the Office of General
Counsel, that compliance with the request would promote the objectives of the
Department.” 45 C.F.R. § 2.3. The Court does not believe that an adverse jury
instruction is warranted when CMS acted in a manner consistent with its authority.
Additionally, Safeway is not entitled to an adverse inference instruction
against a non-party. CMS is not a party to this action because the United States
declined to intervene. See United States ex rel. Eisenstein v. City of New York, 556
U.S. 928, 933 (2009) (noting that the United States “is a ‘party’ to a privately filed
FCA action only if it intervenes in accordance with the procedures established by
federal law.”).
Ergo, the Appeal of United States Magistrate Judge’s Decision [d/e 149] is
DENIED.
6
The Court AFFIRMS and ADOPTS the Opinion and Order [d/e 147] of
United States Magistrate Judge Tom Schanzle-Haskins denying Defendant Safeway,
Inc.’s motion to compel.
ENTER: December 27, 2019
FOR THE COURT:
/s/ Richard Mills
Richard Mills
United States District Judge
7
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?