United States of America ex rel. et al v. D.S. Medical LLC et al

Filing 214

MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that the parties shall, within seven days of the date of this Memorandum and Order, agree upon which limited number of documents, if any, subject to the motion to compel under consideration, warrant the Court's in camera review, and Defendants shall submit those documents to the Court within 14 days of the date of this Memorandum and Order. Signed by District Judge Audrey G. Fleissig on 1/9/17. (CSG)

UNITED STATES DISTRICT COURT
SOUTHEASTERN DISTRICT OF MISSOURI

UNITED STATES OF AMERICA,
ex rel. PAUL CAIRNS, et al.,
Plaintiff,
vs.
D.S. MEDICAL, L.L.C., et al.,
Defendants.

)
)
)
)
)
)
)
)
)
)

Case No. 1:12CV00004 AGF

MEMORANDUM AND ORDER
This qui tam action is before the Court on the Government’s motion (Doc. No
164) to compel production of documents withheld by Defendants under the attorney
client privilege.
The Government claims in this action that Defendant Dr. Sonjay Fonn and three
other Defendants violated the False Claims Act, 31 U.S.C. §§ 3729-33, by submitting
or causing to be submitted to the federal Medicare and Medicaid programs false claims
for reimbursement for Dr. Fonn’s services in performing spinal surgeries between
December 2008 and March 2012, and for the purchase of implant devices used in those
surgeries. The other three Defendants are Deborah Seeger, with whom Dr. Fonn had a
personal relationship at all relevant times, and two corporate entities related to Dr. Fonn
and Seeger, respectively. The claims for reimbursement were purportedly false because
they were the result of alleged kickbacks that violated the federal criminal AntiKickback Statute (“AKS”).

On June 1, 2016, Defendants filed notice that while they were not asserting a
formal advice of counsel defense, they intended to introduce evidence of
communications with counsel on nine listed topics, in an attempt to refute the scienter
element of a violation of the AKS. Accordingly, Defendants stated, they were waiving
the attorney client privilege with respect to those nine topics, which included, for
example, contract negotiations between Seeger and the spinal implant
manufacturers/distributors with whom she interacted, and the relationship between Dr.
Fonn and the other three Defendants. (Doc. No. 148).
Soon thereafter, the Government served Defendants’ counsel (Thompson Coburn
LLP and one of its attorneys) with subpoenas for “any documents related to legal
advice” provided to any Defendant from January 1, 2008, to March 30, 2012. Similar
subpoenas were served on Defendants. On July 28, 2016, Defendants provided the
Government with a “Partial Privilege Log” listing 204 items, including undated and
vaguely-described emails and memos. (Doc. No. 165-1.) Defendants moved to compel
production of the documents in the log, arguing that the limited waiver of the privilege
with respect to the nine topics delineated by Defendants was inappropriate, and, in any
event, the log (and supplemental log) was inadequate.
As was clarified at oral argument on the Government’s motion, despite the broad
nature of the production requests, the Government was only seeking documents related
to legal advice that was relevant to Defendants’ state of mind with regard to the AKS
violations that underlie the Government’s theory of liability. According to Defendants,
the broad language of the requests resulted in a log that was overly inclusive, and so the
2

Court directed the parties to meet and confer further, and to apprise the Court
afterwards if any issues could not be resolved.
Both sides have since filed status reports, notifying the Court that they have
made significant progress on this matter, with Defendants producing many of the
documents previously withheld. Defendants assert that they have produced all
documents related to Defendants’ state of mind with regard to the alleged kickbacks,
and that this, together with a supplemental privilege log it provided the Government,
renders the Government’s motion to compel moot. It appears from the record that at
this point, approximately ten documents may remain in dispute, and both sides agree
that a reasonable course of action would be to submit these documents for the Court’s
in camera review. The Court will follow this suggestion. However, the Court remains
hopeful that the parties can resolve this matter in its entirety, and requests that the
parties continue to confer and notify the Court within the two-week time frame set forth
below if the Government’s motion to compel now under consideration may be denied
as moot.
Accordingly,
IT IS HEREBY ORDERED that the parties shall, within seven days of the date
of this Memorandum and Order, agree upon which limited number of documents, if
any, subject to the motion to compel under consideration, warrant the Court’s in camera

3

review, and Defendants shall submit those documents to the Court within 14 days of the
date of this Memorandum and Order.

AUDREY G. FLEISSIG
UNITED STATES DISTRICT JUDGE
Dated this 9th day of January, 2017.

4