The opinion of the court was delivered by: JAMES ZAGEL, District Judge
MEMORANDUM OPINION AND ORDER
This case began as a fairly routine workers' compensation suit
against Defendants Soo Line Railroad ("Soo Line") and Canadian
Pacific Railroad Company ("Canadian Pacific"). Plaintiff Michael
Wade claimed he sustained an injury to his shoulder while working
as a switchman when a hand brake malfunctioned, causing a
collision. After the accident, Plaintiff engaged Hoey & Farina
lawyer George Brugess to represent him against the railroad.
Brugess has a good deal of experience in these types of cases; he
has worked almost exclusively in railroad cases for the last
twenty years representing both railroads and their employees.
In December 2004, this case took an unusual turn. While Soo
Line's attorney, Daniel Mohan, was taking the deposition of
Plaintiff's treating physician, Dr. Kim of Treister Orthopedic
Services ("TOS"), he noticed that the file she was holding was
somewhat larger than the one he received during discovery. Mohan
asked Dr. Kim to pass Plaintiff's file to him so that he could
inspect its contents. Much to his surprise, Mohan found several
proverbial "smoking-guns" in the file that had not been
previously produced. After discovering these documents, Mohan
became slightly agitated and demanded that the documents be
copied for him. Mohan marked the documents he wanted copied with paper clips and showed
them to Brugess who was also present at the deposition. Dr. Kim
reluctantly agreed to have a clerk in her office copy the stack
of marked documents. The copied documents were brought back into
the room about thirty minutes later. Mohan testified that he
reviewed the copied documents and found at least two if not three
of the "smoking gun" documents were missing. Mohan Direct Test.
p. 31. He claims he asked to see the original file again and,
despite a thorough page-by-page review, could not find the
missing documents even among the originals. Id. Mohan then
questioned Brugess about all of the missing documents. Id. at
36. Brugess, however, replied that he did not know which
documents Mohan was referring to and eventually came to the
conclusion Mohan was looking for one document containing an
independent medical evaluation ("IME") done by Dr. Kim's boss,
Dr. Treister. Brugess Direct Test. p. 20. That document is
Exhibit H here.
As the search for the missing documents went on, the mood in
the room became increasingly tense. Brugess claims that Mohan
became combative with him and Dr. Kim, causing Brugess to end the
deposition. Id. at 21-22. Before ending the deposition, Brugess
found Exhibit H and had a copy made for Mohan. Id. at 23. While
Mohan was interested in Exhibit H, there were two other documents
he felt were more important that were never returned to the
deposition room. These are Exhibits F and G here.
On December 30, 2004, the day after Dr. Kim's deposition, Mohan
subpoenaed the depositions of all staff members on duty the
previous afternoon and of Dr. Kim for January 10 and 11, 2005. In
the deposition rider, Mohan described the contents of the missing
documents as best he could from memory. On January 4, 2005,
unbeknownst to Mohan, TOS faxed the two missing documents, along
with the recently issued subpoenas to Brugess at his office.
Instead of forwarding these documents on to Mohan, Brugess sent a letter on
January 6, 2005, indicating that he would be on trial during the
next week and would need to continue the depositions to a later
date. Brugess stated further that Dr. Kim would be writing a
letter to my chambers detailing Mohan's "erratic behavior at her
first deposition, including the false accusations [he] leveled
against her." Plaint. Ex. L.
On January 7, 2005, Mohan filed an Emergency Motion for a
Protective Order to prohibit TOS from destroying the missing
documents. In that motion, Mohan described the two missing
type written notes, in small type, apparently
generated on a computer, which detailed specific
conversations between Mr. Brugess and Dr. Treister
("Notes"). The Notes stated that a member of Treister
Orthopedic Services had a conversation with Mr.
Brugess wherein the author expressed a concern that
Treister Orthopedic Services would not be paid for
their services regarding Plaintiff's case. The Notes
quoted Mr. Brugess as suggesting that his law firm
would pay for the services directly to the doctor.
The author then stated that he expressed to Mr.
Brugess a concern regarding a "risk of liability
(fraud)" to which Mr. Brugess responded that this is
done all the time and not to worry. Also included in
computer-generated Notes were Dr. Treister's
impressions that Plaintiff had no disability and no
physical finding of any injury or medical condition.
The Note stated that the author, presumed to be Dr.
Treister, wanted to communicate to Mr. Brugess that
he did not know how he could help in this case, and
if Mr. Brugess had any ideas, he would like to hear
Def. Ex. M.
In an Order dated January, 10, 2005, I granted the motion. A
copy of that Order was sent to TOS and Brugess on January 13,
Brugess finally forwarded Exhibits F and G to Mohan on January
25, 2005. The documents are very similar to Mohan's description.
Exhibit F is labeled as a "Collections System Detail Report" and
contains two statements which would be of interest to Mohan. The first says that "[p]atient was referred to [TOS] by Atty Downes
office." This is different from previously produced documents
indicating Plaintiff had been referred by a friend. The second is
a note stating:
Atty Brugess called, states he is aware that we are
just making penny for a dollar billed thru United
Health which we have a contract with, he make a
proposal to bill him for the balance showing that we
did review of record for such $ amt. then he will
include that in the settlement or pay us up front for
that charge. Asked him for the risk that we might
encounter (fraud) in the future. He states it
happened so many times, & that is the only way we
will get our bills paid in full. He will provide the
proper documentation like he will request for record
review then we charge him & he will pay.
Def. Ex. F.
Exhibit G is a letter, authored by Dr. Treister, asking Martha,
a TOS employee, to call Brugess and read him an "unofficial
note." The note states, among other things, that Plaintiff's
shoulder is not showing any signs of continued injury and asks
"how do I indicate disability when basically examination is
normal and there is no atrophy or any other really objective
finding." Def. Ex. G. It also says "I just don't think there is
anything that I can write down which would be helpful rather than
harmful. Does George Brugess have any ideas . . . This note can
be stapled unofficially to the outside of the chart. It is NOT a
report and NOT a progress note." Id.
Defendant Soo Line now asks that I sanction Brugess for failing
to disclose documents which were vital to Mohan's defense and for
improperly attempting to make direct payment of bills to TOS. I
examine first the more serious accusation that Brugess attempted
to pay TOS for their services instead of submitting bills to
United Healthcare or applying them to a settlement amount. The
line in Exhibit F asking about fraud and suggesting that TOS bill
him directly led Mohan to suspect Brugess of making direct
payments to TOS. Def. Ex. F. When put in its proper context,
however, Exhibit F does not suggest the direct payment of medical
treatment. Rather, it almost certainly refers to payment for a document
review or independent medical examination ("IME"). In her note,
the author, Lerma Saringo, states "[Brugess] make a proposal to
bill him for the balance showing that we did review of record for
such $ amt. then he will include that in the settlement or pay us
up front for that charge." Id. Here, the "pay us up front" is
referring to the charges for the "review of records."
TOS's billing statements and the documented payments made by
Hoey & Farina during the relevant time support this
interpretation. Saringo's note of June 9, 2003 is the first
reference we have to Dr. Treister preforming a document review
and/or IME. The document review and/or IME next appears on July
7, 2003 as a charge of $3,200 labeled document review on a TOS
invoice. Ramos Dep., Ex. 2; Def. Ex. S.*fn1 Dr. Treister
testified that he probably performed a document review and then
set-up an appointment for the Plaintiff sometime in the next
three months. Treister Test. p. 15-18. An appointment for the
Plaintiff to see Dr. Treister for an IME, on January 8, 2004, was
confirmed by a letter dated November 6, 2003. Def. Ex. I. The
letter was written by Brugess and stated that additional medical
records were enclosed and that a check for $532 would be sent
under separate cover. Id. That check was dated November 6, 2003
and was applied to Plaintiff's bill on November 18, 2003. Ramos
Dep. Ex. 2. This $532 payment plus two other relatively small payments for production of
documents are the only direct payments made from Hoey & Farina to
TOS. See Plaint. Ex. 4.; Ramos Dep. Ex. 2.
The record further shows that Plaintiff kept his January
appointment with Dr. Treister.*fn2 In fact, that examination
led to the creation of the two most damaging documents Mohan
uncovered at Dr. Kim's deposition, Exhibits G and H. Offering Dr.
Treister the opportunity to perform a document review and/or an
IME was certainly an unsavory "sweatening of the deal." It was
not per se improper. What would likely be improper is the direct
offer to pay an excessive fee for a records review say, in the
exact amount of uninsured medical fees for treating Plaintiff.
Dr. Treister may have so interpreted the offer but it is not the
offer Brugess actually made. According to the record before me,
the only direct payments made by Hoey & Farina to TOS are the
$532 for a document review, $28.25 for production of medical
records, and $51.52 for production of medical records. Since
these fees are related to legal and not medical services, I find
that their direct payment was not improper.
Next, Defendant Soo Line argues Brugess improperly failed to
disclose that Dr. Treister evaluated Plaintiff on January 8, 2004
and failed to disclose the documents containing Dr. Treister's
findings, i.e., Exhibits G and H. There is no question that
Exhibits G and H are damaging to Plaintiff's case. The language
of Exhibit G that: "physical examination not diagnostic of any
specific ongoing condition . . . how do I indicate disability
when basically examination is normal and there is no atrophy or
any other really objective findings?" is the sort that often appears in defense expert reports. Def. Ex. G. And
Exhibit H is similar: "I do not see any muscle atrophy about the
left shoulder. Physical examination shows a full range of motion
of the left shoulder. I do not on physical examination see any
evidence of objective pathology." Def. Ex. H.
Brugess argues that he did not need to disclose the evaluation
or its results because the evaluation was an IME done by a
consulting physician that he (especially after hearing the
results) did not intend to offer at trial. Brugess Test. p. 14.
But, I reject this. Looking at Dr. Treister's involvement with
this case, Brugess could not reasonably have thought of him as
merely a consulting expert. First, Dr. Treister was disclosed as
a treating physician in Plaintiff's Answers to Interrogatories
and in the Attachments to Plaintiff's Rule 26 Disclosures. Def.
Ex. D p. 3; 12. Additionally, Dr. Treister is the sole owner of
TOS and is ...