2013-00152214-CU-PT

Karen Cook vs. AAA Northern CA, NV UT

Nature of Proceeding: Motion to Compel Demand for Inspection

Filed By: Gillespie, G. Rich

Respondent CSAA, IE’s (“CSAA”) motion to compel further responses and production
of documents pursuant to Demand for Inspection, set three from Claimant Karen Cook
(“Cook”) is ruled upon as follows.

This matter arises from an underinsured motorist arbitration. According to CSAA’s
counsel, through discovery it has learned that Cook accepted $15,000 from the
adverse driver’s insurance company. CSAA’s counsel also obtained letters sent to
Cook’s various medical providers which provided a proposal related to payments from
the underinsured motorist insurance coverage for full and complete satisfaction of the
costs of treatment. The letter indicated that the at fault driver’s per person policy limit
was only $15,000 and he was judgment proof. Cook’s medical bills exceeded
$30,000. Thus, Cook’s counsel, proposed a pro-rata compromise agreement between
her medical providers.

CSAA thereafter propounded the following Demand for Inspection on Cook:

(1) Any and all documents and evidence of correspondence between you or your
attorneys and any treating medical care providers related to amounts charged,
paid or accepted for treatment rendered to you related to subject accident.

(2) Any and all documents and evidence of agreements between you or your
attorneys and medical care providers regarding amounts paid for treatment
related to subject accident.

(3) Any and all letters, agreements, billings, invoices, checks or documents relating
to disbursements of the adverse driver’s insurance company settlement funds to
medical care providers for your treatment related to subject accident.

Cook objected to each demand on the following grounds: (1) vague, ambiguous, overly
broad, (2) seeks information protected from disclosure by the attorney work-product
privilege and by the attorney-client privilege, (3) oppressive, burdensome, and
harassing, (4) violative of the collateral source rule, (5) calls for information not
relevant nor reasonably calculated to lead to the discovery of admissible evidence, and
(6) invades Cook’s constitutional right to privacy.

Vague, Ambiguous, Overbroad, Oppressive, Burdensome and Harassing

Cook’s objections are OVERRULED.

Attorney-Client/Work Product

Cook’s objections are SUSTAINED. The Court agrees with Cook that the above
demands may implicate attorney-work product and the attorney-client privilege.
However, there documents sent to or received by third parties are not privileged.

To the extent Cook has withheld documents responsive to this demand, Cook shall
produce a privilege log by no later than December 5, 2013.

Collateral Source Rule/ Not Relevant or Reasonably Calculated to Lead to the
Discovery of Admissible Evidence

Cook’s objections are OVERRULED.

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Cook argues that pursuant to Sanchez v. Strickland (2011) 200 Cal.App.4 758, the
amounts written off by her medical providers are a collateral source and therefore
legally irrelevant. Sanchez provides “here a medical provider has (1) rendered
medical services to plaintiff, (2) issued a bill for those service, and (3) subsequently
written off a portion of the bill gratuitously, the amount written off constitutes a benefit
that may be recovered by the plaintiff under the collateral source rule.” (Sanchez,
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supra, 200 Cal.App.4 769.)

The Court notes, however, that the collateral source rule is a rule of evidence which
precludes the admission of certain evidence at trial. It is not a rule which governs
discovery and therefore, it is not dispositive here. That collateral source information
may itself be inadmissible does not necessarily mean that the discovery is not likely to
lead to other relevant, admissible evidence. Cook has cited no authority which
specifically precludes discovery of the information sought here and since permitting
discovery here is consistent with Code of Civil Procedure §2017.010’s broad language
permitting discovery of “any matter, not privileged, that is relevant…” The requested
discovery may be reasonably likely to lead to the discovery of admissible evidence. (
Howell v. Hamilton Meats & Provisions (2011) 52 Cal.4th 541.)

Moreover, Cook’s argument that settlement offers and negotiations are irrelevant
pursuant to Evidence Code §1152 is misplaced. Evidence Code §1152 is a rule
relating to the admissibility of such evidence. Moreover, Evid. Code §1152 is not a
wholesale preclusion of such evidence, but rather the evidence is inadmissible to
prove liability.

Invasion of Cook’s Constitutional Right to Privacy

Cook’s objections are OVERRULED. Cook argues that the distribution of the
settlement funds directly bears on and involves her financial affairs. The Court
disagrees. The demand only seeks documents involving her medical providers. It
does not seek unfettered information relating to how she distributed all of her
settlement funds.

To the extent CSAA’s motion also seeks to compel the actual production of documents
in response to the request for production, the motion is premature. A motion to compel
compliance pursuant to Code of Civil Procedure §2031.320(a) is appropriate where a
responding party has agreed to produce documents but then fails to permit inspection
consistent with that response. Here, CSAA’s motion indicates that Cook has not yet
agreed to produce any responsive documents and therefore, Cook cannot yet be
compelled to comply with her written response.

Cook shall serve verified further written responses consistent with the above by no
later than December 5, 2013. Cook shall produce a privilege log by no later than
December 5, 2013.

CSAA’s request for sanctions is GRANTED in the amount of $360 (2 hrs x $150
reasonable rate, plus $60 filing fee). If Cook fails to pay the sanction by such date,
then CSAA may lodge for the court’s signature a formal order awarding sanctions,
which may be enforced as a separate judgment. (See Newland v. Superior Court
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(1995) 40 Cal.App.4 608, 615.)

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

Although the notice of motion provided notice of the Court’s tentative ruling system as
required by Local Rule 1.06, the notice does not comply with the current rule. Moving counsel is directed to review the Local Rules, effective January 1, 2013.