Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

United States ex rel. Cairns v. D.S. Medical L.L.C.

United States District Court, E.D. Missouri, Southeastern Division

August 26, 2016

UNITED STATES OF AMERICA, ex rel. PAUL CAIRNS, et al., Plaintiff,
v.
D.S. MEDICAL, L.L.C., et al., Defendants.

          MEMORANDUM AND ORDER

          AUDREY G. FLEISSIG UNITED STATES DISTRICT JUDGE

         This qui tam action is before the Court on Defendant Dr. Sonjay Fonn's motion (Doc. No. 139) to compel production of Reports of Interview of five interviews conducted in 2010 by the government in connection with a criminal investigation in Texas. The government asserts the investigative (law enforcement) privilege. For the reasons set forth below, the motion to compel will be granted.

         BACKGROUND

         The qui tam complaint in the present action was filed on January 5, 2012, claiming, inter alia, that Dr. Fonn violated the False Claims Act, 31 U.S.C. §§ 3729-33, by submitting to the Medicare and Medicaid programs false claims for reimbursement, for his services in performing spinal surgeries between December 2008 and March 2012, and for the purchase of implant devices, from manufacturers including Verticor, LTD, used in those surgeries. The claims for reimbursement were allegedly false because they were the result of kickbacks that violated the federal criminal Anti-Kickback Statute. On June 30, 2014, the government filed its notice of intention to intervene in the case. On September 18, 2014, the government filed criminal charges against Defendants, arising out of the same conduct involved in this civil case, and the Court thereafter granted Defendant's motion to stay the civil case in light of the pendency of the criminal case. On December 15, 2015, the government dismissed the criminal charges, and the stat in this case was lifted on December 17, 2015.

         Dr. Fonn seeks production, in the present case, of Reports of Interview of interviews of five individuals conducted by the government in 2010 in connection with a criminal investigation in Texas of an alleged kickback scheme involving Verticor and its owner, Todd Stanaford. The five individuals are Stanaford and four other employees of Verticor. The Texas allegations were that consulting agreements between Verticor and ten surgeons, not including Dr. Fonn, constituted kickbacks paid to the surgeons for using Verticor spinal implants. No criminal charges were ever brought as a result of the Texas investigation, and it is undisputed that that investigation has been closed for several years. In its Rule 26 disclosures, the government has disclosed the names of the five individuals whose interview reports Dr. Fonn seeks, as witnesses who may be called in the present case. It is undisputed that each of the interviews at issue was conducted under a proffer agreement.

         During the now dismissed criminal case against Defendants, the government turned over the 15-page affidavit in support of the search warrant executed on Verticor's facilities on February 1, 2010, as part of the Texas investigation; the affidavit included information provided by two of the five individuals whose interviews are now at issue. Also during the criminal case against Defendants, the government sent Defendants an email dated May 22, 2015, with a brief synopsis of the Texas interviews with the Verticor employees.

         In response to Defendants' request for the production of the Reports of Interview, the government maintained that the reports were protected by the investigative privilege, whereupon Dr. Fonn filed the present motion to compel production of the Reports of Interview.

         ARGUMENTS OF THE PARTIES

         Dr. Fonn argues that circumstances indicate that in their interviews, none of the five Texas witnesses stated that Dr. Fonn was involved in a kickback scheme with Verticor, and thus what these witnesses were asked, what they said, and what they did not say is important to possible impeachment of the witnesses, if they make such allegations against Dr. Fonn now. Dr. Fonn points out that the interviews were conducted at a time when, according the complaint itself, he was in an adversarial position with Verticor, such that the five Verticor employees would have had no motivation to protect him. He argues further that what the four witnesses other than Stanaford might have said about Stanaford could provide evidence to impeach Stanaford. The government has not disputed Dr. Fonn's assertion that Stanaford will be a key witness against Defendants in the present case. Thus, according to Dr. Fonn, the Reports of Interview could lead to discoverable evidence. He further argues that he cannot obtain the equivalent of the withheld materials by deposing the five individuals now, because the interviews took place in 2010, at a time more contemporaneous with the kickbacks alleged in the present case, and thus have unique value.

         Dr. Fonn argues that because the interviews at issue were part of an investigation in Texas, Fifth Circuit law on the scope of the investigative privilege should apply, but that in any event, the privilege does not apply, because the factors favoring disclosure outweigh any factors suggesting the privilege should be applied here. He also argues that the government's assertion of the privilege is flawed because it is not being asserted by the United States Attorney's Office in Texas.

         Lastly, Dr. Fonn argues, in the alternative, that the government waived the investigative privilege by turning over to Defendants the affidavit in support of the Texas search warrant, which included information provided by two of the five individuals whose interviews are now at issue; and sending the May 22, 2015 email.

         The government responds that “[i]n the final analysis, all that Dr. Fonn's motion demonstrates is the possibility that the reports might lead to the discovery of some cumulative impeachment evidence that would likely not be admissible, ” and so the motion should be denied. The government argues that Dr. Fonn has failed to show a need for the Reports of Interview, and maintains that the Reports of Interview would reveal the government's investigative techniques and procedures. In support of this position, the government has submitted a declaration from the FBI and a declaration from the Office of Inspector General for HHS, the two federal agencies that generated the Reports of Interviews at issue. Both declarations state that production of the Reports of Interview would reveal the agents' choices regarding which facts, transactions, and persons they believed to be significant. (Doc. Nos. 142-2 and 142-3.) Both declarations also state that as the interviews occurred under proffer letters, production “may motivate potential witnesses in the future to avoid proffer interviews with [the government].” Id.

         The government also argues that the Reports of Interview are “unlikely” to help Dr. Fonn impeach the witnesses who were interviewed in Texas, because he has not shown that those individuals adopted the statements therein. The government notes that there is nothing to prevent Dr. Fonn from deposing the five individuals and attempting to impeach them by their own prior statements made in such depositions. Lastly, the government argues ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.