ML Healthcare Services, LLC v. Publix Super Markets, Inc.
881 F.3d 1293
11th Cir.2018Background
- On July 24, 2012 Robin Houston slipped and fell in a Publix supermarket and sued Publix for injuries; case removed to federal court; after an eight-day trial the jury returned a verdict for Publix.
- Discovery showed ML Healthcare is a litigation-investment company that fronted discounted medical bills for uninsured plaintiffs and contracts to recover full medical charges from any tort recovery; ML had arrangements with Houston and her treating doctors.
- Publix sought to introduce evidence of ML Healthcare’s payment/referral relationship to impeach treating doctors for bias and to challenge reasonableness of billed medical expenses; Houston and ML Healthcare argued the evidence was barred by Georgia’s collateral source rule.
- The district court allowed limited admission of ML Healthcare evidence for impeachment (bias) and for challenging reasonableness of bills, and denied ML Healthcare’s motions to quash subpoenas in part; it admitted some collateral-source-adjacent statements at trial but instructed the jury on the collateral source rule.
- Houston moved for spoliation sanctions after Publix preserved only one hour of store video (30 minutes before and after the fall) and erased the rest in the ordinary course; the district court denied sanctions.
- On appeal the Eleventh Circuit reviewed evidentiary rulings, subpoena rulings, and spoliation denial for abuse of discretion and affirmed the district court in all respects.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of ML Healthcare payment evidence (collateral source) | Evidence of ML’s payments is collateral-source material and inadmissible to show anything that would reduce damages | ML evidence is admissible under federal evidence law for non-damages purposes (impeachment for bias; reasonableness of bills) | Admissible for limited purposes (bias; potentially reasonableness); district court did not abuse discretion |
| Choice-of-law re: evidentiary rules | Georgia collateral source rule should bar admission in federal diversity case | Federal evidence rules govern admissibility (but Georgia substantive rule still prevents reduction of damages); state rule allows admission for other material purposes | Federal evidentiary law applies to admissibility; Georgia substantive collateral-source rule still prohibits reducing damages; admission for impeachment permitted |
| Scope / preservation of subpoenas to ML Healthcare | Subpoenas sought collateral-source-protected material and should be quashed | Subpoenas sought non-privileged, relevant impeachment and reasonableness evidence; Rule 45 does not bar production because of collateral-source implications | Denial in part of ML Healthcare’s motions to quash was not an abuse of discretion |
| Spoliation (failure to preserve broader store video) | Publix had a duty to preserve all requested video; loss prejudiced Houston and warrants adverse inference or exclusion of certain testimony | Publix preserved the most relevant hour automatically, followed ordinary retention policies, and had no bad-faith intent to deprive evidence | No bad faith or incurable prejudice shown; denial of adverse-inference and exclusion sanctions affirmed |
Key Cases Cited
- Flury v. Daimler Chrysler Corp., 427 F.3d 939 (11th Cir. 2005) (multi-factor spoliation framework and deference to district court discovery/sanctions rulings)
- Southern v. Plumb Tools, 696 F.2d 1321 (11th Cir. 1983) (federal court must respect state substantive collateral-source rules when procedural rulings would undermine them)
- Polito v. Holland, 258 Ga. 54 (Ga. 1988) (Georgia collateral source rule: collateral benefits do not reduce plaintiff’s recoverable damages; evidence admissible for other material purposes)
- United States v. Abel, 469 U.S. 45 (U.S. 1984) (proof of witness bias is almost always relevant for impeachment)
- S.E.C. v. Goble, 682 F.3d 934 (11th Cir. 2012) (adverse-inference instruction requires bad faith or intent to deprive)
- McDowell v. Brown, 392 F.3d 1283 (11th Cir. 2004) (federal rules of evidence govern evidentiary disputes in diversity actions)