MILLER v. ST. JOHN'S HEALTH SYSTEM, INC.
Filing
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ORDER denying Non-Party IDWD's 18 Motion to Quash; granting in part and denying in part Deft's 20 Motion to Compel (see Order for details). Signed by Magistrate Judge Mark J. Dinsmore on 7/29/2011. (SWM)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION
BARBARA L. MILLER,
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Plaintiff,
vs.
ST. JOHN'S HEALTH SYSTEM, INC.,
Defendant.
ORDER REGARDING SUBPOENA DIRECTED TO NON-PARTY THE INDIANA
DEPARTMENT OF WORKFORCE DEVELOPMENT
This matter is before the Court on non-party the Indiana
Department of Workforce Development’s (“IDWD”) Motion to Quash
[Dkt. 18] and Defendant
Saint John’s Health System, Inc.’s (“St.
John’s”) Motion to Compel Non Party Discovery. [Dkt. 20].
The
Court, being duly advised, now DENIES the Motion to Quash and
GRANTS in part and DENIES in part the Motion to Compel Non-Party
Discovery, as follows:
Plaintiff, Barbara Miller, brought a claim against her
former employer, St. John’s, alleging that she was wrongfully
terminated in violation of the Age Discrimination in Employment
Act (“ADEA”).
St. John’s issued a subpoena duces tecum to IDWD
seeking documents relating to Plaintiff’s application for
benefits through IDWD to determine what steps she had taken to
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seek new employment.
Such records are relevant to Plaintiff’s
wrongful termination claim on the issue of mitigation of damages
and thus are proper for a discovery request by St. John’s.
St.
John’s requested production of:
[A] true, complete and authentic copy of its entire
file and/or records (including computer files) in its
possession for Barbara L. Miller, Date of Birth
[redacted], Social Security No. [redacted] regarding
her employment with and separation from Saint John’s
Health Systems, Inc.
[Brief in Support of Defendant’s Motion to Compel Non-Party
Discovery at Ex. A].
The IDWD is governed by several statutes of the Indiana
Code, including § 22-4-19-6 which states, in pertinent part,
that:
… information obtained or obtained from any person in
the administration of this article and the records of
the department relating to the unemployment tax or the
payment of benefits is confidential and may not be
published or be open to public inspection in any manner
revealing the individual’s or the employing unit’s
identity, except in obedience to an order of a court or
as provided in this section.
Ind. Code § 22-4-19-6(b) (emphasis added).
Acting in what it
claimed to be in accordance with this section of the Indiana
Code, IDWD responded to St. John’s subpoena with a form letter
issued on March 25, 2011, indicating that the “information you
requested is confidential pursuant to Indiana Code 22-4-19-6 and
may not be disclosed in the absence of a court order signed by a
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judge or signed consent from the claimant.” [Brief in Support of
Defendant’s Motion to Compel Non-Party Discovery at Ex. B].
Upon
receipt of IDWD’s form objection, and in compliance with Local
Rule 37.1, Defendant replied in a letter to IDWD on March 28,
2011, explaining that courts in the Southern District of Indiana
have ruled that a subpoena is a court order for purposes of the
requirements of Ind. Code § 22-4-19-6(b), and that the
information sought by the subpoena must, therefore, be disclosed.
[Brief in Support of Defendant’s Motion to Compel Non-Party
Discovery at Ex. C].
Instead of responding to the subpoena, IDWD
filed the Motion to Quash currently before the court, and
Defendant responded by filing the instant Motion to Compel.
IDWD argues that the United States Department of Labor
mandates states to pass legislation that includes provisions for
maintaining the confidentiality of identifying information about
any individual or past or present employer and “provision[s] for
barring the disclosure of any such information except as provided
in this part.”
20 C.F.R. § 603.4(b) (emphasis added).
The
regulations further provide that the “State [unemployment
compensation] agency must file and diligently pursue a motion to
quash the subpoena or other compulsory process or other means of
avoiding the disclosure of confidential [unemployment
compensation] information are not successful or if the court has
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not already ruled on the disclosure.” 20 C.F.R. § 603.7(a).
However, 20 C.F.R. § 603.7(b) provides exceptions to the section
requiring the state agency to file a motion to quash a subpoena
and permits disclosure where “a court has previously issued a
binding precedential decision that requires disclosure of this
type, or a well-established pattern of prior court decisions have
required disclosures of this type.”
The Seventh Circuit recently reaffirmed that a subpoena
duces tecum served by an attorney is an “order of the court.”
U.S. Sec. & Exch. Comm’n v. Hyatt, 621 F.3d 687, 692 (7th Cir.
2010).
In addition, several courts have repeatedly determined
that these orders apply to the court order requirement under Ind.
Code § 22-4-19-6 and have consistently denied IDWD’s motions to
quash subpoenas duces tecum.
See Barker v. Floyd Mem’l Hosp. &
Health Servs., 4:10-cv-00026-RLY-WGH, Docket No. 31, at 4 (S.D.
Ind. Sept. 27, 2010) (compelling production of unemployment file
and holding that the “subpoena duces tecum qualifies as the type
of ‘order of the court’ required by Ind. Code § 22-4-19-6(b).”);
Hughes v. St. Vincent New Hope, Inc., 1:10-cv-1577-LJM-TAB,
Docket No. 28, at 1 (S.D. Ind. May 4, 2011) (IDWD ordered to
produce documents subject to Defendant’s subpoena); Saunders v.
Wesleyan Health Care Ctr., Inc., No. 1:10-CV-00384-SEB-DML, 2011
WL 839664 (N.D. Ind. Mar. 7, 2011) (granting defendant’s motion
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to compel IDWD to produce unemployment compensation file); Pomart
v. Purdue Univ., 2005 U.S. Dist. LEXIS 42709, at *2 (N.D. Ind.
Dec. 15, 2005) (denying IDWD’s motion to quash and ordering
compliance with subpoena issued by the defendant); Davenport v.
Indiana Masonic Home Found., Inc., No. IP 00-1047-C H/G, 2003 WL
1888986, at *3 (S.D. Ind. Mar. 27, 2003) (denying plaintiff’s
motion to quash subpoenas to IDWD).
While these decisions are
non-binding, they certainly constitute a “well established
pattern of prior court decisions” requiring “disclosures of this
type” sufficient to satisfy the exception in 20 C.F.R. §
603.7(b)(1).
Accordingly, IDWD is not mandated by the Department
of Labor to move to quash subpoenas in cases involving these
circumstances.
IDWD now also argues that Section 22-4-19-6(b) must be read
in conjunction with Ind. Code § 22-4-17-9 to conclude that the
information sought by St. John’s is privileged, and that federal
law recognizes such privilege.
IDWD claims that the following
language applies in this case:
Any testimony or evidence submitted in due course
before the board, the department, the review board, an
administrative law judge, or any duly authorized
representative of any of them shall be deemed a
communication presumptively privileged with respect to
any civil action except actions to enforce the
provisions of this article.
Ind. Code § 22-4-17-9.
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IDWD misinterprets and misapplies Ind. Code § 22-4-17-9,
which is actually an immunity statute for unemployment claimants
providing information to state unemployment compensation
agencies, and a privilege statute for employers providing
information about employees.
“The immunity provided in Ind.Code
§ 22-4-17-9 becomes available after an individual is ‘compelled
after having claimed his privilege against self-incrimination to
testify or produce evidence….’” Penny v. Review Bd. of the Ind.
Dept. of Workforce Dev., 852 N.E.2d 954, 957 (Ind. App. 2006)
(quoting Ind. Code § 22-4-17-9). “[T]he ‘privilege’ section of
the statute is intended to protect from libel or defamation
actions employers who provide information about an employment
claimant’s termination from employment.”
Id. at 598; see also
Sanders v. Stewart, 298 N.E.2d 509, 512-13 (Ind. Ct. App. 1973)
(discussing the statute’s creation of a qualified privilege for
employers in libel and slander actions).
The IDWD cites no
authority that applies this statute to the issue present here,
which is the disclosure of records related to unemployment
compensation by IDWD pursuant to a valid subpoena, and misapplies
the statue by only focusing on the last sentence of that
particular code section.1
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Thus, this Court declines to find that
The first part of the Ind. Code § 22-4-17-9 states:
No person shall be excused from attending and testifying or from
producing books, papers, correspondence, memoranda, and other records
before the board, the department, the review board, an administrative
law judge, or the duly authorized representative of any of them in
obedience to the subpoena of any of them in any cause or proceeding
before any of them on the ground that the testimony or evidence,
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§ 22-4-19-6(b) must be read in conjunction with Ind. Code § 22-417-9 to create a privilege preventing disclosure of unemployment
compensation records by IDWD pursuant to a properly issued
subpoena duces tecum.
Furthermore, even if this Court were to accept that Ind.
Code § 22-4-17-9 creates a presumptive privilege under Indiana
state law that would be applicable to this type of disclosure,
IDWD’s argument would fail because such privilege would not apply
in this situation.
The only evidentiary privileges applicable to
federal question suits are provided by federal law; state
evidentiary privileges only apply in diversity cases where state
substantive law applies.
Fed. R. Evid. 501; see also Nw. Mem’l
Hosp. v. Ashcroft, 362 F.3d 923, 926 (7th Cir. 2004).
IDWD
argues that, because the state confidentially statute is mandated
by federal law, the confidentially mandate is “federally
recognized.”
This exact argument has already been rejected by
United States Magistrate Judge Baker in Hughes. 1:10-cv-1577-LDMTAB at Dkt. 28.
A similar argument concerning a privilege
created in Nevada’s unemployment compensation statues has been
documentary or otherwise, required of the person may tend to
incriminate the person or subject the person to a penalty or
forfeiture, but no individual shall be prosecuted or subjected to any
penalty or forfeiture for or on account of any transaction, matter,
or thing concerning which the person is compelled after having
claimed the privilege against self-incrimination to testify or
produce evidence, documentary or otherwise, except that such
individual so testifying shall not be exempt from prosecution and
punishment for perjury committed in so testifying.
(emphasis added)
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rejected in at least one other district.
See Delorie v. Parball
Corp., No. 2:09-CV-00933-RLH, 2010 WL 3238997 at *2 (D. Nev.
2010).
IDWD has provided no legal authority to support the
proposition that a federally mandated state statute transforms a
state privilege into a federal privilege.
In fact, the relevant
federal regulations only require that provision be made that the
information sought herein be protected as “confidential.”
C.F.R. § 603.4(b)(c).
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The chasm between a federal mandate of
confidentiality and the federalization of the state “presumptive
privilege” claimed by the IDWD is so vast that the inferential
leap attempted by the IDWD in an effort to sanction its creation
is doomed to failure, much like Evel Knievel’s attempt to leap
the Snake River Canyon.
Given the lack of legal authority to support IDWD’s
argument, as well as the existence of previous rulings that have
rejected similar arguments, the Court declines to adopt IDWD’s
novel argument.
While it is true that new privileges can be
created through federal common law, the Seventh Circuit has
explained that “it is not for us—especially in so summary a
proceeding as [litigation to quash a subpoena]—to create [a new
privilege] whether all at once or by a process of slow but
inevitable additions….” Nw. Mem’l Hosp., 362 F.3d at 926.
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In light of these considerations, the court finds as
follows:
1. The subpoena duces tecum qualifies as the type of “order of
a court” necessary under Ind. Code § 22-4-19-6(b).
Therefore, IDWD must produce the information sought by
Defendant in the subpoena duces tecum.
2. Defendant is not entitled to attorney’s fees and costs at
this time.
IDWD raised this issue in several cases nearly
simultaneously, and while IDWD’s objections have ultimately
proven to be unsuccessful, it cannot be said that the
position taken by IDWD was not substantially justified when
taken.
However, IDWD has now been unsuccessful in raising
this issue in several cases.
Consequently, the issue of
sanctions will be revisited if IDWD continues to raise and
pursue these objections in future cases.
Dated:
07/29/2011
Mark J. Dinsmore
United States Magistrate Judge
Southern District of Indiana
Distribution List:
Matthew T. Black
STATE OF INDIANA OFFICE OF THE ATTORNEY GENERAL
matthew.black@atg.in.gov
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John H. Haskin
HASKIN & LARUE
jhaskin@hlllaw.com
John Patrick Ryan Jr.
HALL RENDER KILLIAN HEATH & LYMAN
jpryan@hallrender.com
Vanessa Lynne Voigt
INDIANA ATTORNEY GENERAL
vanessa.voigt@atg.in.gov
Craig M. Williams
HALL RENDER KILLIAN HEATH & LYMAN
cwilliams@HallRender.com
Bradley L. Wilson
HASKIN & LARUE
bwilson@hlllaw.com
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