United States District Court, Northern District of Alabama, Southern Division
DEBORAH WOODS, et al., ex rel. UNITED STATES OF AMERICA, Plaintiffs,
SOUTHERNCARE, INC., Defendant
For Debroah Woods, Theresa Goolsby, Thomas Rieder, ex rel. United States of America, Plaintiffs: Oscar Monfort Price, IV, LEAD ATTORNEY, PRICE-ARMSTRONG LLC, Birmingham, AL.
For Simione Healthcare Consultants LLC, Petitioner: Cavender C Kimble, LEAD ATTORNEY, BALCH & BINGHAM LLP, Birmingham, AL.
For Southerncare Inc., Defendant: Kristen P McDonald, Rebekah N Plowman, LEAD ATTORNEYS, JONES DAY, Atlanta, GA; Cavender C Kimble, BALCH & BINGHAM LLP, Birmingham, AL.
MEMORANDUM OPINION AND ORDER
WILLIAM M. ACKER, JR., UNITED STATES DISTRICT JUDGE.
Deborah Woods, Theresa Goolsby, and Teresa Rieder, the relators in an action pending before the United States District Court for the Southern District of Mississippi, Civil Action No. 3:09-cv-313-CWR-LRA, served Simione Healthcare Consultants, LLC (" Simione"), with a subpoena on August 15, 2014. (Doc. 1 at 16). The subpoena designated the law office of Oscar Price, an attorney for the relators, as the place of compliance; such office is located in the Northern District of Alabama. Simione moved to quash the subpoena in this court on September 29, 2014. (Doc. 1). SouthernCare, Inc., the defendant in the underlying suit, filed its own motion to quash the subpoena the following day. (Doc. 3). In response to the motions to quash, the relators filed a motion to transfer the motions to the court that issued the subpoena, the Southern District of Mississippi. (Doc. 6). For the reasons stated below, the relators' motion to transfer will be denied.
SouthernCare is a hospice company with locations in fifteen states. (Doc. 6 at 2). In January 2009, SouthernCare settled a lawsuit with the United States; the suit was brought under the False Claims Act, alleging that the company submitted false claims to the government on behalf of patients who were not eligible for hospice care. (Doc. 6-1 at 2). As part of the settlement, SouthernCare agreed to be evaluated by an Independent Review Organization. (Doc. 6-2). Simione was retained by SouthernCare to perform such evaluation. (Doc. 1 at 3). Simione is a consulting firm based in Hamden, Connecticut, with expertise in the hospice industry. (Doc. 1 at 2-3).
The relators in the underlying action, former employees of SouthernCare, sued the company in the Southern District of Mississippi under the False Claims Act in May 2009, alleging that the company continued to submit false claims to the government. (Doc. 6 at 3). This litigation is ongoing. The relators issued a subpoena to Simione on August 15, 2014, essentially seeking all documents in Simione's possession that relate to its review of SouthernCare. (Doc. 6 at 3). The subpoena requires production at an address in this judicial district. Simione objected and filed a motion to quash in this court on four grounds: (1) the subpoena requires disclosure of proprietary trade secrets and confidential business information; (2) the subpoena requires disclosure of unretained expert's opinions; (3) the subpoena requires disclosure of protected health information of patients and privileged materials; and (4) the subpoena subjects Simione to undue burden. (Doc. 1). SouthernCare filed its own motion to quash and objected on two grounds: (1) the subpoena is overbroad and seeks irrelevant documents; and (2) the subpoena requires disclosure of unretained expert's opinions. (Doc. 4). In response, the relators moved to transfer the motions to the Southern District of Mississippi. (Doc. 6).
Subpoenas are governed by Fed.R.Civ.P. 45, which was substantially amended in 2013. As amended, a subpoena must be issued by the court where the underlying action is pending, but challenges to the subpoena are to be heard by the district court encompassing the place where compliance with the subpoena is required. Fed.R.Civ.P. 45(a)(2), (d)(3)(A). The subpoena must state the place where compliance is required, which must be within 100 miles of where the subpoenaed party resides, is employed, or regularly transacts business in person. Fed.R.Civ.P. 45(a)(1)(A)(iii), (c)(2)(A).
Subsection (f) of Rule 45 is new. It allows the court where compliance is required to transfer a motion regarding the subpoena to the court that issued it. Such transfer is only permissible " if the person subject to the subpoena consents or the court finds exceptional circumstances." Fed.R.Civ.P. 45(f). SouthernCare has not consented to transfer, so the relators must demonstrate that exceptional circumstances exist. The Advisory Committee note explains the exceptional circumstances standard:
In the absence of consent, the court may transfer in exceptional circumstances, and the proponent of transfer bears the burden of showing that such circumstances are present. The prime concern should be avoiding burdens on local nonparties subject to subpoenas, and it should not be assumed that the issuing court is in a superior position to resolve subpoena-related motions. In some circumstances, however, transfer may be warranted in order to avoid disrupting the issuing court's management of the underlying litigation, as when that court has already ruled on issues presented by the motion or the same issues are likely to arise in discovery in many districts. Transfer is appropriate only if such interests outweigh the interests of the nonparty served with the subpoena in obtaining local resolution of the motion.
Fed. R. Civ. P. 45(f) advisory committee's note (2013).
There is little case law interpreting subsection (f), and none from courts within the Eleventh Circuit, since the rule has been in effect for less than a year. The rule text and Advisory Committee's note make clear, however, that subpoena-related motions should be heard in the court where compliance is required, unless the proponent of transfer demonstrates that exceptional circumstances exist. If such circumstances exist, those interests should then ...