Volume I, No. 11

The Texas Supreme Court decided only two (2) cases in October. The lone case of interest to those in the insurance industry is In Re The University of Texas Health Center at Tyler, in which the Supreme Court granted a writ of mandamus as a result of the actions of the trial court in ordering the production of the investigation by a medical peer review committee.

We have also included in the newsletter for this month opinions from the San Antonio and Corpus Christi Court of Appeals. The San Antonio Court of Appeals in Morrill v. Third Coast Emergency Physicians, P.A. held that medical reports required under §13 of Article 4590i must specifically discuss how each defendant breached the applicable standard of care. The failure to provide a report that meets this requirement will result in dismissal of the plaintiff's claim, with prejudice.

The San Antonio Court of Appeals in Roberts v. Rose upheld the power of a trial court to order parties to mediation. Finally, in In Re: Van Waters & Rogers, Inc., the Corpus Christi Court of Appeals established guidelines for trial courts to follow in conducting discovery in mass tort cases.

I. INVESTIGATIONS BY A MEDICAL PEER REVIEW COMMITTEE ARE NOT DISCOVERABLE UNLESS THE COMMITTEE CONSENTS TO PRODUCTION OF INFORMATION IN WRITING

In Re the University of Texas Health Center, opinion delivered October 26, 2000, 2000 WL 1591005 involved the granting of a writ of mandamus in which the Texas Supreme Court held that the University of Texas Health Center at Tyler (hereinafter referred to as the Health Center) did not have to produce records concerning the results of an investigation by a medical peer review committee.

1. FACTS OF CASE

   The trial court ordered the Health Center to produce information concerning an evaluation by a peer review committee of medical care provided to the plaintiff James McClain as well as other patients at the Health Center. James McClain, along with several other patients, brought suit against the Health Center as a result of infections that were contracted following open heart surgery.

   McClain noticed a deposition of a corporate representative of the Health Center. The deposition notice requested that the corporate representative produce several categories of documents. The Health Center objected to the production of the documents, contending that the documents were not discoverable as the notice constituted a request to produce information about the results of an investigation of a peer review committee.

   The date of the first deposition was changed and the plaintiff then filed a second amended notice and, once again, a third amended notice. The Health Center did not file objections to the second amended notice but did file objections to the third amended notice. The issue decided by the Supreme Court was whether documents prepared by a medical peer review committee were discoverable. A secondary issue was whether the Health Center had waived its privilege against the production of such documents.

2. RECORDS FROM A MEDICAL REVIEW COMMITTEE ARE NOT DISCOVERABLE

   The Court found that pursuant to Texas Occupational Code §151.002 (a) (8) [formerly Texas Revised Civil Statutes, Article 4495(b) §1.03 (a) (b)] the records at issue were clearly records involving an investigation by a peer review committee of the Health Center. As such, the Court held that:

   all proceedings and records of a medical peer review committee are confidential, and all records of, determinations of, and communications to a committee are privileged and are not discoverable, with certain exceptions not relevant here. (Citations omitted) Section 161.032 of the Health and Safety Code similarly provides that the records and proceedings of a medical committee are confidential and are not subject to a court subpoena.

   The Court held that the records at issue were clearly "proceedings or records of a medical peer review committee" and as such were not discoverable.
3. ONLY A PEER REVIEW COMMITTEE CAN WAIVE THE PRIVILEGE AGAINST THE PRODUCTION OF RECORDS RESULTING FROM ITS INVESTIGATION AND SUCH WAIVER MUST BE IN WRITING

   The plaintiff furthermore contended that the privilege against production of records from a peer review committee had been waived because (1) the Health Center failed to object to the second deposition notice, (2) the Health Center did not comply with revised Rule of Civil Procedure 193 in objecting to the production of such records, and, finally, (3) the Health Center had provided some of the requested information in answers to discovery and therefore had voluntarily waived the privilege against the production of information resulting from a peer review committee investigation.

   The Court gave no credence to any of these arguments by the plaintiff. The Court held that the Health Center did not waive its objection to the production of information because the Health Center did not object to the second deposition notice. The Court found that the Health Center had clearly objected to the first and third deposition notices and all the deposition notices were substantially similar (other than the notices provided different dates for three depositions of the Health Center representative). The Court held that:

   the Health Center had already made its objections clear in response to the earlier virtually identical notice and request for documents. It was not required to reiterate its objections when only the date and time of the deposition were changed.

   The Court furthermore found that the Health Center did not have to comply with Rule 193 of the Texas Rules of Civil Procedure as the deposition in question and the objections thereto were all filed prior to January 1, 1999, when Rule 193 went into effect.

   Finally, the Court concluded that the Health Center did not waive objections to the production of information resulting from the investigation by the medical peer review committee by partially answering an interrogatory which provided some of the information concerning recommendations by the medical peer review committee. The Court first found that by virtue of the provisions of Texas Occupational Code §160.007 (e)-(g), [formerly Texas Revised Civil Statutes Article 4495 (b), §5.06 (j)], only the peer review committee could execute a waiver. Furthermore, any waiver by the peer review committee must be in writing, as required by statute:

   Unless disclosure is required or authorized by law, records or determinations of or communications to a medical peer review committee are not subject to subpoena or discovery and are not admissible as evidence in any civil judicial or administrative proceeding without waiver of the privilege of confidentiality executed in writing by the committee.

   The Court also quickly dispensed with the third argument by the plaintiff that the Health Center had voluntarily waived the privilege of confidentiality by answering an interrogatory in which the Health Center ". . . voluntarily set forth specific recommendations that its medical peer review committee had made during its investigation of the outbreak of infection." The Court decided that:

   . . . the voluntary production of information about the infection control committee's (the peer review committee at issue) recommendations in response to a discovery request does not waive the privilege that protects the documents received, maintained, or developed by the committee from discovery in this suit asserting health care liability claims.

   The Court noted that even if the Health Center had voluntarily provided some information developed by the medical peer review committee in answers to discovery that this did not operate as a waiver of the privilege. The Court held that a waiver of the peer review committee privilege can only exist if executed by the peer review committee itself and the waiver was clearly set out in writing. As a result, by providing information in discovery, the Health Center had not waived the privilege of confidentiality that was given by statute to a medical peer review committee.

   Finally, the Court reviewed the facts of the case and acknowledged that the trial court had provided copies of the documents at issue to the Plaintiff. The Court found that the trial court could not waive the privilege of confidentiality on behalf of the Health Center as the privilege belonged to the peer review committee and not to the trial court.

The Supreme Court held that the only way to obtain discovery concerning investigations by a medical peer review committee is to have the peer review committee voluntarily waive such privilege in writing. We doubt that there will ever be a situation where a medical peer review committee will want to do so. Any attempts to obtain discovery of a medical peer review committee will be reviewed by the court in accordance with the strict statutory requirements for waiver.

II. EXPERT MEDICAL REPORTS REQUIRED BY ARTICLE 4590i MUST REFER TO EACH DEFENDANT

The San Antonio Court of Appeals in Morrill v. Third Coast Emergency Physicians, P.A., (Opinion delivered October 11, 2000) held that §13 of the Medical Liability and Insurance Improvement Act, Article 4590i, Texas Revised Civil Statutes, requires that expert reports filed pursuant to such Act must specifically refer to each defendant and identify how each defendant has breached the applicable standard of care.

1. FACTS OF CASE

   Suit was brought by the parent of Sondra Morrill alleging medical malpractice for failing to properly diagnose and treat her for bacterial meningitis. Sondra was taken to Sid Peterson Memorial Hospital in Kerrville where she was examined by Dr. Milton Shaw, an ER doctor who worked under contract for Third Coast Emergency Physicians, P.A. The plaintiff alleged that Dr. Shaw, Third Coast Emergency Physicians, P.A., as well as the staff at Sid Peterson Hospital, negligently diagnosed and treated Sondra's medical condition.

   Within 180 days of filing suit, Morrill filed an expert report with the attorneys for the defendants. The expert for the plaintiffs, Donald J. Gordon, Ph. D., M.D., was an ER doctor who had practiced emergency room medicine as well as taught medical students emergency medicine for 20 years in the South Texas area. As such, Dr. Gordon stated that he had " . . . knowledge of accepted standards of care for the emergency diagnosis, emergency care and emergency treatment of bacterial meningitis, the condition affecting Sondra on the date in question."

   Dr. Gordon's report was critical of the care given to Sondra by the emergency room doctor and defendant, Milton Shaw. Dr. Gordon concluded that:

   ...it is my preliminary belief that serious breaches of the standards of care involving appropriate examination, documentation, laboratory testing, diagnosis, treatment involving the care of Sandra [sic] Morrill on July 29, 1997 by Dr. Milton Shaw, M.D. and that she was severely harmed and suffered serious injury as a direct result.

   Dr. Gordon's report did not mention any criticism of either Third Coast Emergency Physicians, P.A. or the medical staff at Sid Peterson Memorial Hospital. The attorneys for the defendants filed a motion requesting that the court dismiss the plaintiff's case on the basis that the report by Dr. Gordon did not meet the requirements of §13 of Article 4590i. The trial court agreed with the defendants and dismissed the claims of the plaintiffs, with prejudice.
2. THE MEDICAL REPORT WAS SUFFICIENT AGAINST DR. SHAW, THE ER DOCTOR

   The Court of Appeals held that Dr. Gordon's report met the requirements of §13 of Article 4590i to prevent dismissal of the claims of the plaintiffs against Dr. Shaw. The Court of Appeals found that Dr. Gordon clearly possessed " . . . the requisite expertise to render an expert report." More important, Dr. Gordon's report expressed his opinions concerning Dr. Shaw's alleged breach of the acceptable standard of care for an ER physician. As such, the Court of Appeals found that the trial court erred in dismissing the claims of the plaintiffs against Dr. Shaw.

3. REPORT UNDER §13, TO BE SUFFICIENT, MUST STATE SPECIFIC OPINIONS AS TO EACH DEFENDANT

   While the Court of Appeals found that the report of Dr. Gordon was sufficient to prevent dismissal of the claims against Dr. Shaw, the Court also held that Dr. Gordon's report was deficient in expressing any opinions against the medical staff at Sid Peterson Memorial Hospital or against Third Coast Emergency Physicians. As such, the Court of Appeals upheld the dismissal of the claims against Sid Peterson Memorial Hospital and Third Coast Emergency Physicians. The Court found that:

   Nowhere in the report does Gordon state the standard applicable to these health care providers or allege a breach of the standard.

In order for medical reports to be sufficient to prevent dismissal of the claims of the plaintiff for failure to comply with §13 of Article 4590i, "the report must specifically refer to the defendant and discuss how that defendant breached the applicable standard of care." Wood v. Tice, 988 SW2d 831. It is significant that even though Third Coast Emergency Physicians, P.A., was responsible for staffing the emergency room at Sid Peterson Hospital, the failure to express any opinions against Third Coast resulted in the dismissal of the claim against it.

Therefore, unless medical reports find specific faults against a health care provider, which fault falls below the applicable standard of care, the courts will uphold a dismissal against such health care provider.

III. FAILURE TO APPEAR FOR COURT ORDERED MEDIATION IS SANCTIONABLE CONDUCT (Roberts. V. Rose, 2000 WL 1534749)

1. FACTS OF CASE

   This case arises from a lawsuit originally filed by A.D. Murr v. Pete Rose, d/b/a El Segundo Ranch. Murr originally sued Rose for an alleged unpaid debt. Mr. Murr hired the appellant, Kirby J. Roberts, to represent him. Rose filed a counterclaim against Murr. On January 21, 1999, the court ordered Murr and Rose to participate in mediation. At the hearing at which the sanctions were assessed, Mr. Murr denied ever seeing the order of referral to mediation. He also denied that his attorney, Mr. Roberts, advised him prior to March 17, 1999, of the scheduled date for the mediation or that he had been ordered to attend mediation. According to Mr. Murr's testimony, the only conversation regarding mediation occurred after March 17, 1999, the scheduled date of the mediation.

   Roberts did fax a letter to the mediator advising the mediator that he had a conflict with the mediation time. There were no other discussions concerning the mediation, or rescheduling the mediation.

   As a result of the failure of Roberts and Murr to appear at mediation, the Court sanctioned them jointly to pay Rose $1,250.00 for failure to appear at the mediation. At a subsequent hearing, the Court modified it's order of sanctions requiring Roberts to pay the full $1,250.00 as sanctions originally assessed, and to reimburse Murr $945.00 in attorneys fees. No sanctions were ordered against Murr.

2. THE TRIAL COURT HAS AUTHORITY TO ORDER PARTIES TO ATTEND MEDIATION

   The appeal was based upon the position that the trial court abused its discretion in assessing sanctions. The court noted that "a trial court abuses its discretion when it acts without reference to any guiding rules or principals." Johnson v. Fourth Court of Appeals, 700 SW2nd 916, 918 (Tex. 1985). The court also noted that the courts have authority to sanction parties for bad faith abuses if doing so will aid in the exercise of its jurisdiction, the administration of justice, and the preservation of the court's independence and integrity." In re Max Bennett, 960 SW2nd 35, 40 (Tex. 1997).

   There is a dual standard to determine whether the imposition of sanctions is just. There must be (1) a direct relationship between the offensive conduct and the sanction imposed, and 2) an attempt by the trial court to determine whether the offensive conduct is attributable to counsel only, to the party only, or to both. Wetherhold v. Mercado Mexico Café, 844 SW2nd 806, 808 (Tex. App. - Eastland, 1992, no writ).

   The legitimate purpose of discovery sanctions is threefold. The first is to secure compliance with discovery rules. The second is to deter other litigants from similar misconduct. The third is to punish violators. Chrystler Corp. v. Blackmon, 841 SW2nd 844, 849 (Tex. 1996).

   In finding that the court's sanctions against Roberts were just, the Court of Appeals noted that Murr and Roberts were not being sanctioned for a failure to mediate in good faith. In Decker v. Lindsay, 824 SW2nd 247, 250 (Tex. App.-Houston [1st District] 1992, no writ), the Court of Appeals found that while parties cannot be forced to resolve their disputes at mediation, they can be compelled to sit down with each other. Instead, the sanctions were assessed for failing to appear. The authority of a trial court to sanction a party for failing to attend a court ordered settlement conference has been upheld in Gleason v. Lawson, 850 SW2d 714, 717 (Tex. App.-Corpus Christi, 1993, no writ).

   In applying the two prong test, the Court found that there was a direct relationship between Roberts' acts of bad faith in his representation of Murr and his failure to attend the mediation. Such satisfied the relationship between the offensive conduct and the sanction imposed, since the sanction was only imposed against Roberts. In considering the second prong of the test, that the sanctions be fair, the court found that the sanctions were appropriate. The sanctions were not outrageously punitive, and were only assessed against Roberts. As a result, the Court affirmed the trial court's ruling and found no abuse of discretion.

While parties cannot be required to settle their differences at a mediation the trial court does retain authority to require parties to appear and at least talk about their differences. Failure to do so can result in sanctions being assessed.

IV. COURT FINDS THAT TRIAL COURT DID NOT ABUSE ITS DISCRETION IN BREAKING 400 PLAINTIFF CASE INTO TRIAL GROUPS OF 20 AND ABATING DISCOVERY AS TO REMAINING PLAINTIFFS:

1. FACTS OF CASE

   In Re: Van Waters & Rogers, Inc. et al, 2000 WL 1610213 (Tex. App.-Corpus Christi, October 26, 2000,) the Thirteenth Court of Appeals considered whether a trial court abused its discretion in breaking 400 Plaintiffs into trial groups of 20 and abating discovery as to the remaining Plaintiffs. This matter arose out of a toxic tort suit involving over four hundred plaintiffs who were employed at the Parker-Hannifin Corporation's processing plant in McAllen, Texas. These Plaintiffs brought suit in 1994 against numerous defendants alleging personal injuries from exposure to various chemicals manufactured, marketed, sold and/or distributed by the defendants. Discovery was conducted over the next several years.

   In answering interrogatories, the Plaintiffs failed to adequately answer questions regarding the names of the physicians who attributed their conditions to any of the defendants' products. Rather, the Plaintiffs responded that "Plaintiff . . . does not recall the names of any of the medical health care providers attributing the injuries to exposure to Defendants' chemicals nor the dates of treatment. Plaintiff will later supplement if Plaintiff later recalls this information" After numerous discovery motions and hearings, the trial court eventually entered a pre-trial order that (1) allowed the plaintiffs to select twenty plaintiffs to appear first in trial, (2) abated discovery as to all plaintiffs except the initial twenty designated for trial, (3) allowed discovery as to an additional twenty-five plaintiffs, and (4) ostensibly refused to compel plaintiffs to supplement their answers to an interrogatory relating to causation of plaintiffs' injuries. Defendants filed a writ of mandamus seeking relief from the pretrial orders. This case was eventually heard by the Texas Supreme Court. The Texas Supreme court entered a ruling directing the Thirteenth Court of Appeals to reconsider a previous ruling in light of Colonial Pipeline Co., 968 S.W.2d 938 (Tex. 1998).

2. THERE WAS NO ABUSE OF DISCRETION IN BREAKING NUMEROUS PLAINTIFFS INTO SMALLER TRIAL GROUPS

   The Thirteenth Court found that trial courts have discretion in managing their court dockets. Accordingly, there was no abuse of discretion in the trial court selecting small groups of trial plaintiffs to serve as test cases while abating discovery as to the remaining plaintiffs in order to manage the mass tort case. The court noted:

   Considering the need to manage mass tort litigation, the basic discovery provided to the defendants, and the trial court's providing defendants with a means of attaining discovery from non-trial plaintiffs, we conclude the court did not abuse its discretion by allowing selection of a small group of plaintiffs and abating additional discovery as to all but the forty-four trial plaintiffs."

3. TRIAL COURT ABUSED ITS DISCRETION IN FAILING TO REQUIRE PLAINTIFFS TO PROVIDE COMPLETE ANSWERS TO INTERROGATORIES REGARDING THEIR MEDICAL HISTORY AS IT RELATED TO TOXIC EXPOSURE

   The defendants in this case contended that the plaintiffs' responses to interrogatories were inadequate because they neither provided the names of any physicians who attributed their injuries to the defendants' chemicals, nor denied that a physician had, in fact, made such a determination. The court concluded that the uniform response by all plaintiffs that they did not recall the names of any physicians who had linked their injuries to the defendants' chemicals and that they did not ask a medical health care provider if the chemicals at the plant caused their medical condition was insufficient and must be supplemented to answer whether a medical determination has been made that an illness was caused by the defendants' products.

   The court further concluded that the medical authorizations, lists of doctors who have treated the plaintiffs, and the injuries described in the plaintiffs' initial disclosures did not provide the defendants with discovery on the issue of causation. Neither did the expert reports provided by the plaintiffs linking some of the products at the plant to various injuries constitute a response to the interrogatory, as none of the reports explain whether a physician has made a medical determination that an illness was caused by a defendant's product.

   Therefore, the court noted that the plaintiffs must answer whether there has been a medical determination attributing their injuries to the defendants' chemicals. If no physician has made such a determination, regardless of plaintiffs' theory of liability, they should answer accordingly.

In mass tort cases it is not an abuse of discretion for a trial court to break the number of plaintiffs into smaller trial groups and abate discovery as to the remaining plaintiffs. However, in cases involving toxic torts, Plaintiffs must adequately answer discovery and provide names of doctors who can testify about identifiable injuries that are caused by identifiable products of toxic tort defendants.

Please feel free to call any of our partners or associates with any questions that you may have at 361-881-9217 or fax us at 361-882-9437.