Tracey v. St. Jude Medical, Inc.

Filing 65

ORDER granting 45 Motion for Protective Order. The court will not enter a separate protective order. Tracey's Motion to Compel Plaintiff's Notices of Subpoenas Duces Tecum 48 is denied. Ordered by Magistrate Judge Thomas D. Thalken. (JSF)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA

LISA TRACEY,
Plaintiff,

8:14CV198

vs.
ORDER
ST. JUDE MEDICAL, INC.,
Defendant.
This matter is before the court on the parties’ related Motion for Protective Order
(Filing No. 45), filed by the defendant, St. Jude Medical, Inc. (St. Jude), and Motion to
Compel Plaintiff’s Notices of Subpoenas Duces Tecum (Filing No. 48), filed by the
plaintiff, Lisa Tracey (Tracey). St. Jude filed a brief (Filing No. 46) with evidentiary
attachments (Filing Nos. 46-1 and 46-2) in support of its motion. Tracey filed a brief
(Filing No. 49) and index of evidence (Filing Nos. 51 and 52) in support of her motion.
Tracey also filed response (Filing No. 55) and index of evidence (Filing No. 56) in
opposition of St. Jude’s motion. St. Jude filed a brief (Filing No. 61) in opposition to
Tracey’s motion and brief (Filing No. 62) in support of St. Jude’s motion.

BACKGROUND
This case involves the circumstances surrounding Tracey’s termination from St.
Jude. Tracey alleges St. Jude wrongfully terminated her for reporting and opposing St.
Jude’s unlawful billing activities. See Filing No. 1 - Complaint. Specifically, Tracey
alleges she opposed fraudulently billing a patient for a medical device in order to
provide such device, free of charge, to a different patient and other false purchase
orders. Id. ¶¶ 30-42. Tracey asserts St. Jude retaliated against her in violation of the
Nebraska Fair Employment Practices Act (NFEPA) and Nebraska public policy. Id. ¶¶
29-49.

St. Jude denies it acted fraudulently and denies it terminated Tracey’s

employment because of her opposition to the alleged fraudulent activity. See Filing No.
12 - Answer.
On April 30, 2015, Tracey filed and served four notices for subpoenas deposition
duces tecum. See Filing Nos. 40-43 - Notices of Subpoenaed Videotaped Deposition

Duces Tecum. According to Tracey, the four individuals subject to the subpoenas are
non-party individuals who have been identified during discovery as having knowledge of
St. Jude’s fraudulent billing practices.

See Filing No. 49 - Brief; Filing No. 55 -

Response. The four individuals are Steve Goltl (Goltl) and Bonnie Brabec (Brabec),
employees of Methodist Hospital in Omaha, Nebraska; Gladys Linn (Linn), an employee
of Jennie Edmundson Hospital in Council Bluffs, Iowa; and Robin Paprocki (Paprocki), a
Nebraska Medical Center nurse case manager. See Filing No. 49 - Brief p. 2-3. The
subpoenas to Goltl, Brabec, and Linn generally seek all evidence relating to any request
to change, correct, and fix any false or inaccurate purchase order by any current or
former St. Jude employee, all evidence relating to suspected false purchase orders
submitted by any current or former employee of St. Jude for any patient, including
patients covered by Medicaid or Medicare at the entity, and all evidence relating to
anything of value in excess of $50 provided by any employee of St. Jude to any medical
provider at the entity. See Filing Nos. 56-9, 56-10, and 56-12 - Goltl, Brabec, and Linn
Subpoenas. The subpoena to Paprocki generally seeks all evidence showing medical
devices and products provided to the subpoenaed entities and various doctors without
charge or at a reduced rate by any employee of St. Jude from 2011 to 2013, evidence
showing billing or invoicing for any medical devices or products provided by any
employee of St. Jude from 2011 to 2013, evidence showing documentation or
disclosure regarding a non-charge status for any medical device or product provided by
St. Jude from 2011 to 2013, and evidence showing fees, revenue, remuneration,
services charges, or any other value billed, charged or received from a medical provider
at the entity who accepted a free device or product from St. Jude’s employees from
2010 to 2013 and who provided that device to a patient.

See Filing No. 56-11 -

Paprocki Subpoena.
Tracey argues the testimony sought from Goltl, Brabec, Linn, and Paprocki is
relevant because it directly bears on Tracey’s burden of proof to show she had a good
faith belief St. Jude engaged in unlawful activities. See Filing No. 49 - Brief; Filing No.
55 - Response. St. Jude argues the subpoenas seek irrelevant information. See Filing
No. 46 - Brief p. 5-8. St. Jude also contends the subpoenas are overbroad, impose and
undue burden on St. Jude’s customers, and less restrictive means exist to obtain the
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information. Id. at 8-12. St. Jude argues Tracey should first seek the information from
St. Jude before harassing St. Jude’s customers. Id.

ANALYSIS
“Parties may obtain discovery regarding any nonprivileged matter that is relevant
to any party’s claim or defense.” Fed. R. Civ. P. 26(b)(1). “Broad discovery is an
important tool for the litigant, and so ‘[r]elevant information need not be admissible at
the trial if the discovery appears reasonably calculated to lead to the discovery of
admissible evidence.’” WWP, Inc. v. Wounded Warriors Family Support, Inc., 628
F.3d 1032, 1039 (8th Cir. 2011) (alteration in original) (quoting Fed. R. Civ. P.
26(b)(1)). Accordingly, relevant information includes “any matter that bears on, or that
reasonably could lead to other matter that could bear on, any issue that is or may be in
the case.” Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 351 (1978). Mere
speculation that information might be useful will not suffice; litigants seeking to compel
discovery must describe with a reasonable degree of specificity the information they
hope to obtain and its importance to their case. See Cervantes v. Time, Inc., 464 F.2d
986, 994 (8th Cir. 1972). Once the requesting party meets the threshold relevance
burden, generally “[a]ll discovery requests are a burden on the party who must respond
thereto. Unless the task of producing or answering is unusual, undue or extraordinary,
the general rule requires the entity answering or producing the documents to bear that
burden.” Continental Ill. Nat’l Bank & Trust Co. of Chicago v. Caton, 136 F.R.D.
682, 684-85 (D. Kan. 1991) (citation omitted). The court has authority to limit the scope
of discovery. Roberts v. Shawnee Mission Ford, Inc., 352 F.3d 358, 361 (8th Cir.
2003).
Under this court’s local rules, “[n]o subpoena may be issued for documents or
premises whose inspection or production is contested under this rule until the parties
resolve the objections. Any unresolved objections will be resolved by the court on
appropriate motion filed in accordance with NECivR 7.1.” NECivR 45.1(b); see also
Fed. R. Civ. P. 45. A party may move for an order protecting disclosure or discovery.
See Fed. R. Civ. P. 26(c). The party moving for the protective order has the burden to
demonstrate good cause for issuance of the order. See Miscellaneous Docket Matter
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No. 1 v. Miscellaneous Docket Matter No. 2, 197 F.3d 922, 926 (8th Cir. 1999). After
showing good cause, the court may forbid disclosure or discovery. See Fed. R. Civ. P.
26(c)(1)(A).

A.

Standing
“[An] adverse party has standing to object to a third-party subpoena on grounds

of relevance or to protect a personal right or privilege in the information requested.”
Streck, Inc. v. Research & Diagnostic Sys., Inc., No. 8:06CV458, 2009 WL 1562851,
at *3 (D. Neb. June 1, 2009) (citing Mawhiney v. Warren Distrib., Inc., No.
8:05CV466, 2007 WL 433349, at *1 (D. Neb. Feb. 7, 2007), aff’d, 283 Fed. Appx. 424,
No. 07-2753 (8th Cir. July 10, 2008); Union Pac. R.R. Co. v. Mike’s Train House, Inc.,
No. 8:05CV575, 2006 WL 1134781, at *3 (D. Neb. Apr. 25, 2006)). St. Jude contends
the information sought is irrelevant.

“A party does have standing to move for a

protective order if a third-party subpoena seeks irrelevant information.” Streck, Inc.,
2009 WL 1562851, at *3 (citing Auto-Owners Ins. Co. v. Southeast Floating Docks,
Inc., 231 F.R.D. 426, 429 (M.D. Fla. 2005)). Accordingly, based on St. Jude’s argument
the discovery is irrelevant, St. Jude has standing to contest issuance of the subpoenas.
Additionally, because Tracey’s subpoenas generally seek St. Jude’s purchase orders
and products sent to St. Jude’s customers, St. Jude also appears to have a personal
right in the information.

St. Jude retains an interest in the confidential business

information despite Tracey seeking the billing information from third parties.

B.

Merits
St. Jude has demonstrated good cause exists to preclude Tracey from obtaining

the irrelevant information. Furthermore, Tracey has failed to show how the sought-after
information, generally the individuals’ employers’ financial, billing, purchasing, and
invoicing information, is relevant to establish Tracey’s good faith belief St. Jude
engaged in unlawful activity. Tracey relies on Wolfe v. Becton Dickinson & Co., 662
N.W.2d 599 (Neb. 2003) to support her argument the subpoenaed information is
relevant to show she had a reasonable, good faith belief St. Jude acted unlawfully. The
Supreme Court of Nebraska held in Wolfe that an employee is protected “from
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employer retaliation for his or her opposition to an act of the employer only when the
employee reasonably and in good faith believes the act to be unlawful.” Wolfe, 662
N.W.2d at 605. Wolfe explained “a reasonable, good faith belief [does] not requir[e] an
actually unlawful practice.” Id. Instead, “[i]n order for such a belief to be reasonable,
the act believed to be unlawful must either in fact be unlawful or at least be of a type
that is unlawful.” Id. at 606. Contrary to Tracey’s assertion, there is no requirement
Tracey prove St. Jude actually committed fraud to show she acted reasonably. See id.;
see also Ludlow v. BNSF Ry. Co., No. 4:12CV3113, 2013 WL 3872930, at *13 (D.
Neb. July 24, 2013). Further, the information relevant to Tracey’s good faith belief is
what Tracey knew at the time she objected to and opposed St. Jude’s alleged unlawful
activity. According to Tracey, the following incidents formulated her belief St. Jude
engaged in unlawful activity:

an email from St. Jude’s regional manager directing

Tracey and another employee to “[s]ign up the next patient that does not need [a broad
band adaptor] and send it to this patient;” documents from Methodist Hospital related to
alleged fraudulent charges by a St. Jude employee; and an email indicating an
unauthorized purchase order was entered on behalf of the VA Medical Center. See
Filing No. 52-3 Ex. C - Peltz’s Feb. 27, 2013, Email; Filing No. 52-8 Ex. G - Methodist
Hospital Documents; Filing No. 56-6 Ex. D - Tracey Depo. p. 161 - 166, 190:11 191:23, 267:7-16. Tracey already has evidence to support her belief St. Jude engaged
in fraudulent activity.1 Evidence of St. Jude’s past fraud, if it exists, which was unknown
to Tracey, is irrelevant to Tracey’s good faith belief.
Additionally, Tracey has not otherwise explained, beyond arguing the information
is relevant to her good faith belief, how the information is relevant to her claim for
retaliation, which requires she suffered an adverse employment action for engaging in
protected activity. See Riesen v. Irwin Indus. Tool Co., 717 N.W.2d 907, 915 (Neb.
2006) (“To establish a prima facie case of unlawful retaliation, an employee must show
that he or she participated in a protected activity, that the employer took an adverse
employment action against him or her, and that a causal connection existed between
the protected activity and the adverse employment action.”); see also Helvering v.

1

Even assuming the information Tracey seeks is relevant to her claims, the information would seemingly
be cumulative under Fed. R. Civ. P. 26(b)(2)(C)(1).
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Union Pac. R. Co., 703 N.W.2d 134, 150 (Neb. Ct. App. 2005) (noting opposing any
unlawful act of the employer is protected of Neb. Rev. Stat. § 48-114(3)).

Tracey

contends the information sought is relevant to St. Jude’s violations of federal law and
Nebraska’s criminal code. Although Tracey alleges in her complaint St. Jude’s activities
may violate other laws, Tracey has only asserted violations of the NFEPA and Nebraska
public policy in her complaint. See Filing No. 1 - Complaint.
Accordingly, the court finds St. Jude has shown good cause for a protective order
protecting the documents requested in Tracey’s four notices for subpoenas deposition
duces tecum. The court will not compel issuance of the subpoenas.

IT IS ORDERED:
1.

St. Jude’s Motion for Protective Order (Filing No. 45) is granted. The court

will not enter a separate protective order.
2.

Tracey’s Motion to Compel Plaintiff’s Notices of Subpoenas Duces Tecum

(Filing No. 48) is denied.

Dated this 3rd day of June, 2015.
BY THE COURT:
s/ Thomas D. Thalken
United States Magistrate Judge

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