ELOISE L. HANCE, ET AL., Plaintiffs-Appellees, v. CLEVELAND CLINIC, Defendant-Appellant.
No. 110129
COURT OF APPEALS OF OHIO EIGHTH APPELLATE DISTRICT COUNTY OF CUYAHOGA
April 29, 2021
2021-Ohio-1493
MARY J. BOYLE, A.J.
JUDGMENT: AFFIRMED
RELEASED AND JOURNALIZED: April 29, 2021
Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-20-929034
Appearances:
Kampinski & Roberts, Charles I. Kampinski, and Kristin M. Roberts, for appellees.
Reminger Co., L.P.A., Brian D. Sullivan, William A. Meadows, and Brian T. Gannon, for appellant.
MARY J. BOYLE, A.J.:
{¶ 1} This case came to be heard upon the accelerated calendar pursuant to
The trial court incorrectly compelled the production of privileged peer review documents that also contained confidential and proprietary trade secrets.
{¶ 3} Finding no merit to the assignment of error, we affirm the trial court‘s judgment.
I. Procedural History and Factual Background
{¶ 4} In February 2020, the plaintiffs filed a complaint against the Clinic for medical negligence, recklessness, and loss of consortium. They alleged that a physician, employed by the Clinic and acting within the scope of his duties with the Clinic, performed spinal surgeries on Eloise Hance after she sought a diagnosis and treatment for discomfort in her back. In the affidavit of merit supporting the complaint, a physician who practices in neurosurgery opined that the physician employed by the Clinic operated on Eloise Hance based on a misdiagnosis. The plaintiffs claimed that the negligence and recklessness of the physician decreased Eloise Hance‘s life expectancy and left her permanently paralyzed from the waist down. They allege that she suffers severe and persistent pain and will require medical care and treatment into the future. The plaintiffs demanded both
{¶ 5} In July 2020, the plaintiffs moved to file an amended complaint, which the trial court granted. In the amended complaint, the plaintiffs added allegations that the physician who operated on Eloise Hance failed to inform her that the surgery could substantially and permanently worsen her condition.
{¶ 6} In September 2020, the plaintiffs filed a motion to compel the Clinic to produce documents in response to two document requests: Request No. 9 of their second set of discovery requests, and Request No. 1 of their third set of discovery requests.2 The requests sought documents referring to the Clinic‘s efforts to motivate its neurosurgeons to increase patient access and revenue. The plaintiffs explained in their motion to compel that these requests were in response to deposition testimony of one of the Clinic‘s neurosurgeons.3
{¶ 7} Request No. 9 of the second set requests the following:
Copies of all documents (including but not limited to emails, letters, memoranda, charts, graphs, and profit/loss analyses) of the type discussed by Dr. Krishnaney at pages 85-89 of his deposition transcript, which documents referred to or described any intent or desire to motivate the neurology staff to improve patient access, increase time slots, recapture market share, counter loss of patient volume to competitors, or otherwise increase revenues and/or numbers of patients.
Copies of the minutes of all Department of Neurological Surgery staff meetings held during the period January 1, 2016 through February 2019, during which meetings [sic] attendees discussed (in whole or in part) any intent or desire on the part of [the Clinic] or any of its officers, managers, or administrators to motivate or encourage the neurosurgery staff to improve patient access, increase timeslots, recapture market share, counter loss of patient volume to competitors, increase numbers of patients treated or procedures performed, or otherwise increase revenues produced[.]
{¶ 9} In opposition to the motion to compel, the Clinic argued that the documents responsive to these requests are protected by the peer-review privilege and contain trade secrets. The Clinic attached to its opposition the affidavit of Dr. Thomas Mroz, who was the Clinic‘s director for the Center of Spine Health from 2015 to 2019.
{¶ 10} After briefing, in November 2020, the trial court ordered the Clinic to submit any documents responsive to these two requests for in camera inspection. The Clinic filed a “Notice of Submission of Privilege - Objection Log and Documents for In-Camera Inspection,” in which it stated that it was separately emailing to the court‘s staff attorney the documents subject to in camera inspection, Bates labeled MTC000001-MTC000048. The Clinic also explained that it had redacted from the documents it submitted to the trial court (1) most names, (2) information unresponsive to the plaintiffs’ requests, and (3) “[r]aw data, specific numeral information, and/or dollar amounts, consistent with Plaintiffs’ counsel‘s representation during the November 6, 2020 Court conference that the Plaintiffs’ counsel was not requesting such data.”
{¶ 12} It is from this judgment that the Clinic timely appealed. Before oral argument, this court sua sponte ordered the Clinic to supplement the record with the documents it had submitted to the trial court for in camera inspection. The Clinic submitted the redacted documents under seal.
II. Final Order
{¶ 13} As a preliminary matter, we must determine whether the trial court‘s judgment granting the plaintiffs’ motion to compel is a final, appealable order. Article IV, Section 3(B)(2) of the Ohio Constitution limits this court‘s jurisdiction to the review of “judgments or final orders of the [trial] courts.” A trial court‘s discovery orders are generally interlocutory and, therefore, not immediately appealable. Mezatasta v. Enter. Hill Farm, 6th Dist. Erie No. E-15-037, 2016-Ohio-3371, ¶ 16.
{¶ 14} However, a judgment that compels the production of documents or information that is alleged to be protected by the peer-review privilege is a final order and, therefore, immediately appealable.
III. Peer-Review Privilege
{¶ 15} The Clinic first argues that the peer-review privilege codified in
{¶ 16} Generally, a discovery dispute is reviewed for abuse of discretion. Med. Mut. of Ohio v. Schlotterer, 122 Ohio St.3d 181, 2009-Ohio-2496, 909 N.E.2d 1237, ¶ 13, citing State ex rel. Sawyer v. Cuyahoga Cty. Dept. of Children & Family Servs., 110 Ohio St.3d 343, 2006-Ohio-4574, 853 N.E.2d 657, ¶ 9. However, whether the information sought in discovery is confidential and privileged “is a question of law that is reviewed de novo.” Id., citing Castlebrook, Ltd. v. Dayton Properties Ltd. Partnership, 78 Ohio App.3d 340, 346, 604 N.E.2d 808 (2d Dist.1992). Accordingly, we review de novo whether the peer-review privilege applies. See Squiric v. Surgical Hosp. at Southwoods, 7th Dist. Mahoning No. 20 MA 0015, 2020-Ohio-7026, ¶ 60-69 (applying de novo standard to trial court‘s refusal to apply peer-review privilege).
{¶ 18}
Proceedings and records within the scope of a peer review committee of a health care entity shall be held in confidence and shall not be subject to discovery or introduction in evidence in any civil action against a health care entity or health care provider[.]
In Smith, we explained that the purpose of
{¶ 19} The party asserting the peer-review privilege must “establish the existence of a committee that meets the statutory definition of ‘peer review committee’ contained in
{¶ 20}
“Peer review committee” means a utilization review committee, quality assessment committee, performance improvement committee, tissue committee, credentialing committee, or other committee that does either of the following:
(a) Conducts professional credentialing or quality review activities involving the competence of, professional conduct of, or quality of care provided by health care providers, including both individuals who provide health care and entities that provide health care;
(b) Conducts any other attendant hearing process initiated as a result of a peer review committee‘s recommendations or actions.
{¶ 21} The Clinic argues that the requested documents arose from a “utilization review committee” that involves the “quality of patient care.” The Clinic contends that the documents “contain information regarding the deliberative process” that its Neurological Institute and Center for Spine Health uses to “increase patient access and improve patient care.”
{¶ 22} The only evidence the Clinic produced in support of its peer-review argument is the affidavit of Dr. Mroz. But nothing in Dr. Mroz‘s affidavit supports the Clinic‘s contention that its “utilization review committee” fits the definition of a “peer review committee” or that the requested documents are within the scope of this committee. Indeed, the affidavit does not mention any committee at all, let alone a “utilization review committee” or any a committee that would fit the definition of “peer review.” The contested documents themselves consist of emails from Dr. Mroz to his “Team” and Center for Spine Health staff meeting minutes.
{¶ 23} Accordingly, we find that the Clinic has not satisfied its burden to establish that the peer-review privilege applies to prevent it from responding to the plaintiffs’ document requests.
IV. Trade Secrets
{¶ 24} Lastly, the Clinic contends that the requested documents contain confidential trade secrets and are therefore protected from disclosure. The Clinic relies on Dr. Mroz‘s affidavit to establish that the documents contain trade secrets. It maintains that the documents are therefore shielded from discovery pursuant to Ohio‘s Uniform Trade Secrets Act (“UTSA“) and
{¶ 25} The Eighth District has applied a de novo standard of review to the question of whether certain documents contain trade secrets. See Harris, 8th Dist. Cuyahoga No. 103460, 2017-Ohio-2851, at ¶ 11-12. However, since this court decided Harris, the Ohio Supreme Court held in In re Alternative Energy Rider Contained in the Tariffs of Ohio Edison Co., 153 Ohio St.3d 289, 2018-Ohio-229, 106 N.E.3d 1, ¶ 35, that “[w]hether information constitutes a trade secret is a question of fact.” Accordingly, we will follow the Ohio Supreme Court‘s holding and
{¶ 26} The UTSA is set forth in
{¶ 27}
“Trade secret” means information, including the whole or any portion or phase of any scientific or technical information, design, process, procedure, formula, pattern, compilation, program, device, method, technique, or improvement, or any business information or plans, financial information, or listing of names, addresses, or telephone numbers, that satisfies both of the following:
(1) It derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use.
(2) It is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.
{¶ 28} The Ohio Supreme Court has established the following “six-factor test for determining whether information constitutes a trade secret pursuant to
(1) The extent to which the information is known outside the business; (2) the extent to which it is known to those inside the business, i.e., by the employees; (3) the precautions taken by the holder of the trade secret to guard the secrecy of the information; (4) the savings effected and the value to the holder in having the information as against competitors; (5) the amount of effort or money expended in obtaining and developing the information; and (6) the amount of time and expense it would take for others to acquire and duplicate the information.
State ex rel. Plain Dealer v. Ohio Dept. of Ins., 80 Ohio St.3d 513, 524-525, 687 N.E.2d 661 (1997), citing Pyromatics, Inc. v. Petruziello, 7 Ohio App.3d 131, 134-135, 454 N.E.2d 588 (8th Dist.1983). No single factor is dispositive. MNM & MAK Enters., LLC v. HIIT Fit Club, LLC, 2019-Ohio-4017, 134 N.E.3d 242, ¶ 25 (10th Dist.).
{¶ 29} “In a discovery dispute, those asserting that the materials sought constitute trade secrets that are privileged from discovery bear the burden of establishing trade secret status.” Arnos v. MedCorp, Inc., 6th Dist. Lucas No. L-09-1248, 2010-Ohio-1883, ¶ 20. “Conclusory statements as to trade secret factors without supporting factual evidence are insufficient to meet the burden of establishing trade secret status.” Id. at ¶ 28, citing State ex rel. Besser v. Ohio State Univ., 89 Ohio St.3d 396, 404, 732 N.E.2d 373 (2000) (”Besser II“). In addition, the party claiming to possess a trade secret must demonstrate that it has taken
{¶ 30} We note that the Clinic submitted the requested documents to the trial court and to this court in a heavily redacted format. The small portions of the documents that are unredacted refer generally to a “budget” and the Center for Spine Health‘s progress in complying with it. The documents contain no unredacted details regarding specific data or dollar amounts, and the Clinic represents that the plaintiffs are not requesting such details. On its face, the general nature of the unredacted content would not appear to derive economic value from not being generally known by others.
{¶ 31} In its appellate brief, the Clinic quotes Dr. Mroz‘s affidavit to argue that these documents contain trade secrets. The Clinic explains that the requested material is “business information that derives independent economic value as it is not generally known to, and not ascertainable by” its competitors. The Clinic contends that it takes “reasonable efforts to maintain the secrecy of this information” and that the information is not known outside the Clinic or internally other than by its administrative leadership and “select individuals.” The Clinic claims the “information is not made public or otherwise published for outside consumption.” It states that it “expends significant time and resources to gather and analyze” the following: “the extent of its ability to provide patient access“; “the opportunities to increase patient access“; “the extent of the Center for Spine Health‘s market share“; “the comparative market share and number of patients [the Clinic]
{¶ 32} The Clinic‘s argument and Dr. Mroz‘s affidavit consist of merely conclusory statements that mimic the trade secret factors without including any supporting evidence or demonstration of active steps the Clinic has taken to preserve the information‘s secrecy. See Besser II, 89 Ohio St.3d 396, at 400, 732 N.E.2d 373 (2000) (affidavit statement that memorandum was a trade secret because the hospital “derives potential economic value from not being generally known to, and not being readily ascertainable to, persons who can obtain economic value from its disclosure” was conclusory); Arnos, 6th Dist. Lucas No. L-09-1248, 2010-Ohio-1883, at ¶ 17-28 (affidavit that contained no factual detail was conclusory). Dr. Mroz included no factual detail to support his assertions, and the Clinic submitted no other evidence to support Dr. Mroz‘s affidavit or its opposition to the plaintiffs’ motion to compel. The Clinic‘s reliance on conclusory affidavit statements is insufficient to satisfy its burden to show that the requested documents contain trade secrets. See Besser II at 404.
{¶ 33} Even if the requested documents did contain trade secrets, the Clinic has not shown that it would be entitled to withhold their production altogether. The Clinic contends that trade secrets are absolutely protected from discovery pursuant
{¶ 34} As the Seventh District explained in Squiric, 7th Dist. Mahoning No. 20 MA 0015, 2020-Ohio-7026, there is a difference between cases involving civil discovery and cases involving public records requests: “In contrast to cases involving civil discovery and applying
{¶ 35} “Although confidential, trade secret information is not absolutely privileged.” Armstrong v. Marusic, 11th Dist. Lake No. 2001-L-232, 2004-Ohio-2594, ¶ 23; Svoboda v. Clear Channel Communications, Inc., 6th Dist. Lucas No. L-02-1149, 2003-Ohio-6201, ¶ 19. “The rules require the court to balance the need to preserve a trade secret with a party‘s right to discover material that is relevant and reasonably necessary.” Splater v. Thermal Ease Hydronic Sys., Inc., 169 Ohio App.3d 514, 2006-Ohio-5452, ¶ 11 (8th Dist.). The trial court, as appropriate, “may fashion a protective order which limits who may have access to the discovered evidence.” Id. “The court must balance the competing interests to be served by allowing discovery to proceed against the harm which may result from disclosure of trade secrets.” Id. However, the record does not reflect that the Clinic ever moved for a protective order.
{¶ 36} Given the lack of evidence that the requested documents, as redacted, contain trade secrets, we find that the trial court‘s decision that the documents contained no trade secrets was not unreasonable, arbitrary, or unconscionable. Therefore, we find that the trial court did not abuse its discretion.
{¶ 38} Judgment affirmed.
It is ordered that appellees recover from appellant the costs herein taxed.
The court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate be sent to said court to carry this judgment into execution.
A certified copy of this entry shall constitute the mandate pursuant to
MARY J. BOYLE, ADMINISTRATIVE JUDGE
SEAN C. GALLAGHER, J., and
EMANUELLA D. GROVES, J., CONCUR