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December 1, 2016
Court takes up attorney-client privilege

By Gary Blankenship
Senior Editor

Can a law firm representing a personal injury client be compelled to reveal if it referred the client to a particular medical facility, how many past clients have been referred to that facility, and whether it has a “cozy” relationship with those medical providers? Or is that information protected by attorney-client privilege?

The Florida Supreme Court wrestled with those issues in oral arguments November 3 for Heather Worley v. Central Florida Young Men’s Christian Association, etc., case no. SC 15-1086.

Quote Worley had tripped and fallen in the YMCA parking lot and made two trips to an emergency room with an injured knee. After the last visit, doctors there advised her to seek treatment from a specialist. But without insurance, Worley didn’t seek that treatment, and instead hired the high-profile law firm, Morgan and Morgan.

The law firm eventually filed suit against the YMCA and Worley was treated at the Sea Spine Orthopedic Institute under a letter of protection from Worley and her law firm.

During depositions, the YMCA’s attorney asked Worley if her law firm had referred her to Sea Spine. Her attorney objected and instructed her not to answer, asserting attorney-client privilege, and the YMCA attorney took the matter to the trial judge. The judge ruled that Worley did not have to answer that question, but that she could be asked about others who might have referred her.

In a subsequent deposition, Worley said she had not been referred by other doctors, the emergency room, friends, or relatives. The YMCA then filed interrogatories asking Morgan and Morgan how many times it had referred clients to Sea Spine, the amount of the bills, whether Sea Spine doctors had testified as experts in the firm’s cases, and other information.

Morgan and Morgan objected and said providing the information would cost more than $94,000 and was either not necessary for the case or available from other sources. After a hearing, the trial judge allowed some of the questions and disallowed others. Morgan and Morgan appealed to the Fifth District Court of Appeal, which upheld the trial judge, but certified the issue to the Supreme Court, citing a conflict from the Second DCA.

In its initial brief to the court, Worley argued, that “[T]his decision undermines the sanctity of the attorney-client privilege by creating a need/want exception to the privilege that should not stand. Therefore, this Court should hear this case on the merits and protect the privilege from untoward erosion.”

In its follow-up filing, Worley said the defense had questioned representatives from Sea Spine who said they thought Worley had been referred by the emergency room and that Sea Spine’s corporate representative said the facility did not take lawyer referrals.

Quote In its reply brief, YMCA argued that Worley had unusually high medical bills and it suspected a “cozy relationship” between Morgan and Morgan and the medical providers. It said the court should uphold the Fifth DCA because “the decision supports the truth-seeking function of our judicial system. On the other hand, the holding in Burt [the conflicting decision from the Second DCA] that a plaintiff’s referral by her attorney to her doctor is a privileged communication, has been used to hide the existence of the lucrative financial relationships between treating physicians and lawyers.”

YMCA also contended because the treating doctors could be both fact witnesses and expert witnesses at a trial, extra scrutiny was warranted.

During oral arguments at the Supreme Court, Philip Padovano, representing Worley, said the attorney-client privilege should be interpreted broadly. In response to a question from Justice Charles Canady, Padovano noted that F.S. §90.502 in the evidence code “says a communication between a lawyer and a client — doesn’t say legal advice; it says communication — is confidential if it is not intended to be disclosed to third persons.”

That is necessary, he said, because “if you have a situation in which a person is in a lawyer’s office talking about a case and the lawyer makes a comment or they have a discussion about some subject, the entire course of that conversation is privileged and subject to the attorney-client privilege. We don’t go back through and parse out, ‘Well, what about this? Was this legal advice or was that legal advice?’ The whole design of it is to ensure that the conversation is protected.”

Justice Barbara Pariente wondered if the underlying case was getting off track with concerns about relationships between the plaintiff’s lawyers and doctors instead of on the plaintiff’s alleged injuries. She noted if the lawyers were acting improperly, The Florida Bar would be the proper agency to investigate.

Padovano agreed, calling it a “dangerous” diversion. But that prompted Justice Ricky Polson to ask if it would ever be appropriate for the defense to probe into a possible “special relationship” between the plaintiff’s attorneys and doctors.

“I think there could be some cases where that is appropriate,” Padovano replied. “But I don’t know that having a letter of protection and showing that the bills were extraordinarily high in this case would open that door.”

He added later, “We’ve always been careful not to allow collateral matters to overtake the main show.”

Joseph Flood, representing the YMCA, said the defense was not seeking privileged communications, only to confirm “the fact of the referral.”

He also argued the relationship between law firms and doctors in such cases are important because jurors might tend to see the treating doctors as impartial when in fact they gain substantial economic benefits from their ties to the law firms who can supply both patients and lucrative payments.

In response to questions from the justices, Flood said Worley’s medical bills were $66,000 where other medical providers would have charged $3,000 to $5,000 and that the knee surgery she had at Sea Spine was on the other side of the knee than where she originally complained of her injury. Morgan and Morgan has also revealed in the past three years 238 of its clients have been treated at Sea Spine (Padovano noted the firm has had around 75,000 clients).

Pariente asked why the defense needed more information if it already had that information ready to introduce at trial.

“The next step is simply to establish, as the courts have indicated we have the right to do, of the relationship between Mrs. Worley’s counsel and these doctors,” Flood replied.

When Pariente pressed further about how that would force the law firm to keep more detailed records on how and why clients were referred, Flood said, “I would suggest whenever lawyers enter into the world of medical management, as here, picking which clients go to which doctors, that they should be required — just like defendants and defense lawyers and insurance companies have for years and years — to keep records of that. And when medical professionals decide to get into the litigation world, that they should be required to keep records.”

The case attracted outside interest. The Florida Justice Association said it was not concerned about financial discovery on any relationship between treating doctors and plaintiff attorneys, but agreed with Worley that the Fifth DCA decision should be reversed.

“The decision and others like it in recent years will likely hinder the ability of patients to receive quality medical care when they are injured in accidents and there is a possibility of litigation. These cases may also deny access to the courts for those patients who end up in litigation. The FJA strongly believes that if financial discovery is permitted, to minimize the chilling effect of intrusive discovery, rules should limit discovery to that available from retained expert witnesses. This Court previously approved rules for retained experts,” the FJA said in its amicus brief, adding some medical providers already shun treating such accident patients because of potential problems in resulting litigation.

The Florida Justice Reform Institute supported the YMCA and said the current process is an incentive for lawyers and involved doctors to have the doctors charge high rates. Doctors many times sell off the letter of protection to a third party, the institute argued.

“The higher the stated medical expenses, the higher the overall damages award will be if the patient/plaintiff’s claim is successful. Because law firms are paid on a contingency basis, law firms have every incentive to refer clients to physicians who charge high prices for their services. And because private health insurance is not involved, payment for medical damages in these cases is not limited by provider contracts. This allows (and incentivizes) physicians to charge prices significantly higher than the customary prices charged for identical treatment and to perform unnecessary medical procedures,” the institute argued in its amicus brief. “These same treating physicians may then testify in depositions and at trial, acting as purported experts, even though they are extremely biased towards supporting the reasonableness and necessity of their own inflated medical bills. . . .

“If the plaintiff’s attorney referred the plaintiff to the treating physician, and the treating physician will also testify as the plaintiff’s purported expert witness, the inherent bias of the physician’s opinions and potential for inflated or fraudulent billing must be exposed.”

The Florida Defense Lawyers Association agreed with the YMCA and the reform institute, saying, “that where a plaintiff’s lawyer and treating doctor are involved in an ongoing referral arrangement, fundamental fairness requires that the defense be entitled to discover this fact and that such information be available to preclude or rebut arguments that are often made at trial, that the plaintiff’s treaty physicians’ opinion are more worthy of belief than the defense’s medical experts, because the plaintiff’s physicians are allegedly independent of the litigation.”

[Revised: 03-25-2017]