2016-00199407-CU-WT

Christian Koszka vs. California State Assembly

Nature of Proceeding: Motion to Compel Production of Documents, Set Two and Subpoenas

Filed By: Callaghan, Allison C.

Defendant California State Assembly’s (“Defendant” or the “Assembly”) motion to compel plaintiff Christian Koszka (“Plaintiff”) to provide further responses to Defendant’s request for production of documents, set two, numbers 1-16, and to produce unredacted documents in response to Defendant’s subpoenas to Dignity Health Medical Foundation, Mercy Medical Group/Dignity Health, and Patsy Zike, CSW, is ruled upon as follows.

By way of backdrop, Plaintiff was employed by the Assembly as a photographer. His position was eliminated in 2015 as part of a reorganization. Plaintiff filed his complaint on August 25, 2016. The operative First Amended Complaint, filed December 28, 2018, alleges causes of action for, among other things, retaliation, disability discrimination, failure to prevent discrimination and retaliation, failure to engage in the interactive process, and failure to make reasonable accommodation. Plaintiff seeks alleged damages for lost past and future income, benefits, employment, and career opportunities, as well as past and ongoing emotional distress relating to depression and anxiety.

This motion seeks further responses and production of documents to requests pertaining to Plaintiff’s tax returns and financial records relating to a freelance photography business, FreeTime Productions, which Plaintiff owned and operated during his employment with the Assembly. This motion also seeks production of medical records in unredacted form pursuant to the parties’ “first look” agreement and in response to Defendant’s three document subpoenas to Plaintiff’s healthcare providers.

Requests for Production, Numbers 1 to 8

Although California recognizes a privilege against disclosing tax records, that privilege is not absolute. In Schnabel v. Superior Court (1993) 5 Cal.4th 704, 721 the California Supreme Court wrote that: “the privilege is waived or does not apply in three situations: ‘(1) there is an intentional relinquishment (Crest Catering Co. v. Superior Court (1965) 62 Cal.2d 274, 278), (2) the ‘gravamen of [the] lawsuit is so inconsistent with the continued assertion of the taxpayer’s privilege as to compel the conclusion that the privilege has in fact been waived’ (citation), or (3) a public policy greater than that of confidentiality of tax returns is involved (citation).’” (Schnabel v. Superior Court, supra, 5 Cal.4th at 721.)

Requests 1 to 8 seek copies of Plaintiff’s state and federal tax returns for 2013 to the present and those documents he reviewed or provided to a tax preparer in connection with the preparation of his taxes. Plaintiff objected on the grounds of the tax privilege and right to privacy and has refused to produce any responsive documents. Defendant seeks further responses and responsive documents.

Defendant contends Plaintiff has waived the tax privilege because he voluntarily provided a single 2007 tax return to Defendant when seeking employment. This argument is rejected as Defendant cites to no legal authority in support of this proposition. There is no evidence of an intentional relinquishment of the privilege as to the 2013-present state and federal tax returns.

Second, Defendant contends Plaintiff has testified he did not keep good books so the only way to learn how profitable FreeTime Productions was is by looking at his tax records. While this may be Plaintiff’s testimony, the Court is not persuaded the only way to obtain the requested information is via tax returns. Indeed, as noted by Plaintiff, Plaintiff has attempted to provide the information via alternate means, such as a verified worksheet reflecting the income, expenses, and deductions of FreeTime Productions from 2013 to the present. Defendant contends this worksheet contradicted Plaintiff’s sworn testimony, but even so, that is not a compelling reason to override the tax return privilege.

No further response need be provided as to requests 1 to 8. The Court finds, at this juncture, Plaintiffs’ assertion of the tax return privilege is valid, and that the cases cited by Defendant are distinguishable. The gravamen of this employment action is not inconsistent with the assertion of the privilege. (Revenue & Taxation Code §§ 19542 and 19542.1; Brown v. Superior Court (1977) 71 Cal. App. 3d 141.)

Requests for Production, Numbers 9 to 16

Requests 9 to 14 seek financial books and records, invoices, accounting software, and bank statements relating to FreeTime Productions from 2013 to the present. Requests 15 and 16 seek Plaintiff’s W-2 and 1099 forms and other documents evidencing wages Plaintiff earned from 2013 to the present. Plaintiff objected on the grounds of privacy (his and third party privacy), but agreed to and did produce responsive documents from 2015 to the present. Some of the invoices produced also redacted the names, phone numbers, and addresses of third parties on the grounds of third party privacy rights. Defendant seeks documents from 2013 to the present and that redactions of invoices be removed.

The party seeking discovery of financial records must show a compelling need for the requested information by showing the information requested is directly relevant and essential to the fair resolution of the lawsuit. (Alch v. Superior Court (2008) 165 Cal.App.4th 1412, 1425.) “One such compelling public need lies in facilitating the ‘ascertainment of truth’ in connection with legal claims.” (Ombudsman Services of Northern California v. Superior Court (2007) 154 Cal.App.4th 1233, 1249.)

As Plaintiff has produced the requested financial records, but only for 2015 to the present, Plaintiff concedes the information (to some extent) is relevant to his claims. What remains in dispute is whether records going back to 2013 are also directly relevant.

The Court finds Defendant has established Plaintiff’s financial records relating to FreeTime Productions from 2013 to the present are directly relevant to the fair resolution of this lawsuit. Plaintiff has claimed lost wages, benefits, and career opportunities. Plaintiff operated FreeTime Productions both during his employment with the Assembly and after. Therefore, Plaintiff’s earnings from FreeTime Productions and W-2 and 1099 forms for a narrow period of time prior to his termination is relevant to determine his economic loss. Accordingly, further responses and the production of responsive documents as to requests 9 to 16 are warranted.

However, the Court finds the invoices need not be produced in unredacted form. Defendant has failed to meet its burden to demonstrate the redacted information is directly relevant to the issues in this case or that it cannot obtain the information through less intrusive means.

Medical Records

In regards to Plaintiff’s medical records, Plaintiff produced medical records, but redacted information unrelated to Plaintiff’s depression and anxiety. Defendant seeks the medical records in unredacted form. Defendant contends the cause of Plaintiff’s depression and anxiety will be at issue and Plaintiff has produced documents from his physicians indicating his “job is not the cause.” Defendant argues neither Plaintiff nor his counsel are physicians and they should not be permitted to redact conditions from Plaintiff’s medical records that may have had a causal relationship with Plaintiff’s depression and anxiety.

In situations such as these, where it is argued that a party waives protection by filing a lawsuit, the Court must construe the concept of waiver narrowly and the requisite “compelling public interest” is demonstrated only where the material sought is directly relevant to the litigation. Such waiver extends only to information relating to the medical conditions in question, and does not automatically open all of a patient’s past medical history to scrutiny. (Britt v. Superior Court (1978) 20 Cal.3d 844, 858-859.) As recognized by Britt v. Superior Court (1978) 20 Cal.3d 844,863-865, by seeking damages based on his depression and anxiety, Plaintiff did not tender his life-long medical history. An implicit waiver of a party’s constitutional rights encompasses only discovery directly relevant to the plaintiff’s claim and essential to the fair resolution of the lawsuit. (Id. at p. 859.) Based on the foregoing, the Court finds, at this time, Plaintiff need not produce his medical records in unredacted form. Plaintiff has produced his medical records relating to his depression and anxiety which are the injuries Plaintiff has placed at issue.

Finally, Defendant contends it will be seeking leave of court for a mental examination of Plaintiff and the examining physician will need access to all of Plaintiff’s unredacted medical records to fully assess his mental condition. This argument is rejected. The Assembly has not yet sought or been granted leave of court for a mental examination of Plaintiff and has cited no legal authority entitling the Assembly to all of Plaintiff s medical records.

Sanctions

Given the mixed results of the motion, Defendant’s and Plaintiff’s requests for sanctions are denied.

Conclusion

Plaintiff shall provide further verified responses and produce responsive documents to requests for production, set two, numbers 9 to 16, no later than February 14, 2019.

The motion as to the remaining requests and subpoenas is denied.

The minute order is effective immediately. No formal order pursuant to CRC Rule 3.1312 or further notice is required.