United States District Court, E.D. Missouri, Eastern Division
MEMORANDUM AND ORDER
CATHERINE D. PERRY UNITED STATES DISTRICT JUDGE.
background of this dispute is set out in the Memorandum and
Order on plaintiff's summary judgment motion that was
entered earlier today. This order rules on two pending
discovery motions: Plaintiff's Motion to Compel
Production of Documents  and Dr. Patricia Maryland's
Motion to Quash Plaintiff's Subpoena Ad Testificandum
. For the reasons that follow, I will grant the Motion to
Compel and will deny the Motion to Quash. This Order also
provides instructions to the parties regarding the Case
Management deadlines and trial setting in the case.
Motion to Compel
First Request for Production, plaintiff Comprehensive
Pharmacy Services, LLC (CPS) sought documents held by
defendant Ascension Health Resource and Supply Management
Group, LLC, d/b/a The Resource Group's (TRG's)
Participants relating to the underlying material operating
and other changes that occurred between fiscal year 2015 and
fiscal year 2016. CPS maintains these changes “gave
rise to the need for contractually required adjustments,
i.e., changes that materially altered pharmaceutical costs at
TRG Participants.” ECF No. 59 at 4. CPS argues the
information requested is central to CPS's claim that TRG
breached the contract by failing to negotiate required
adjustments to its savings calculation for changes that took
place at TRG Participants during 2015-2016. In its Response
in Opposition to Plaintiff's Motion to Compel, TRG
contends that the documents requested are neither relevant
nor proportional to the needs of the case.
Federal Rules of Civil Procedure relating to discovery permit
each party to serve the opposing party with document requests
and interrogatories which relate to “any matter that
may be inquired into under Rule 26(b).” Fed.R.Civ.P.
33(a)(2) and 34(a). Under Rule 26(b)(1), “[p]arties may
obtain discovery regarding any nonprivileged matter that is
relevant to any party's claim or defense and proportional
to the needs of the case, considering the importance of the
issues at stake in the action, the amount in controversy, the
parties' relative access to relevant information, the
parties' resources, the importance of the discovery in
resolving the issues, and whether the burden or expense of
the proposed discovery outweighs its likely benefit.”
Fed.R.Civ.P. 26(b)(1). Where a party fails to cooperate in
discovery, the propounding party may move the Court
“for an order compelling an answer, designation,
production, or inspection.” Fed.R.Civ.P. 37(a)(3)(B).
“Some threshold showing of relevance must be made
before parties are required to open wide the doors of
discovery and to produce a variety of information which does
not reasonably bear upon the issues in the case.”
Hofer v. Mack Trucks, Inc., 981 F.2d 377, 380 (8th
Cir. 1992). “Upon a showing by the requesting party
that the discovery is relevant, the burden is on the party
resisting discovery to explain why discovery should be
limited.” CitiMortgage, Inc. v. Allied Mortg.
Group, Inc., 4:10CV1863 JAR, 2012 WL 1554908, at *2
(E.D. Mo. May 1, 2012).
that the information requested by CPS is relevant to its
claim that TRG breached SOW 8 by failing to negotiate certain
adjustments. SOW 8 requires the negotiation of miscellaneous
adjustments in order to calculate the pharmaceutical baseline
target - which in turn is used to calculate savings and any
refund. The pertinent provision of SOW 8, Section II E,
states the following:
[A] Pharmaceutical Baseline Target will be established for
each Participant and in the aggregate for each Regional
Health Ministry. . . . The Pharmaceutical Baseline Target
will be calculated from actual Participant financials and
other financial data, provided to CPS by Participant . . . .
Miscellaneous adjustments will be reviewed and mutually
agreed upon by CPS and The Resource Group, (for example: late
drug spend invoices posted to Participants financials in
baseline period, but originated in a prior period).
ECF No. 26-4 at 15. TRG argues that the “miscellaneous
adjustments” referred to above should be limited to
minor accounting discrepancies and not include the type of
material changes alleged by CPS. However, although Section II
E does set forth an example of an accounting adjustment, the
full scope of permissible miscellaneous adjustments is not
limited or defined by the contract. The evidence before me
indicates that CPS and TRG both contemplated and discussed
significant adjustments to pharmaceutical costs. CPS has made
the necessary threshold showing of relevance.
also argues I should deny the motion as CPS's requests
are overbroad and not proportional to the needs of this case.
However, after the parties met and conferred, CPS narrowed
the scope of its requests and reduced the number of TRG
participants it sought data from to 26. Moreover, any burden
in production must be considered in relation to the amount in
controversy - which here is alleged to be at least $5.4
million. Thus, I find that CPS's requests for production
(4, 10, 11, 15 and 16) are both relevant and proportional,
and I will grant CPS's motion to compel as set forth
Patricia Maryland's Motion to Quash
CPS issued a Notice of Deposition and served a Subpoena
seeking to take the deposition of Dr. Patricia Maryland. Dr.
Maryland is the Executive Vice President of Ascension Health
Alliance, which is the parent company of
defendant/counter-plaintiff TRG, among others. She is also
the President and Chief Executive Officer of Ascension
Health, d/b/a Ascension Healthcare, a “sister
company” of TRG.
argues that Dr. Maryland should not be subjected to a
deposition because she is a high-level corporate
executive and a deposition would be unduly
burdensome. TRG also argues that she does not have any
role in the day-to-day operation of TRG, and that CPS is
obligated to use less burdensome means to obtain the
information. In particular, TRG argues that CPS must take the
depositions of lower-level personnel before it should be
allowed to question Dr. Maryland.
asserts that Dr. Maryland was involved in the decision to
terminate the contract. They have provided TRG documents
(filed under seal because designated confidential by TRG)
showing her involvement in strategy meetings and other
discussions about the CPS contract that is the subject of
this lawsuit. Those documents show that TRG executives
dealing with the CPS contract, including the executive that
signed TRG's demand letters and letter terminating the
CPS contract, had direct and numerous discussions with Dr.
Maryland about CPS's performance under the contract. This
is more than sufficient to meet the plaintiff's
“threshold showing of relevance.” Hofer,
981 F.3d at 377.
argument that because Dr. Maryland is a high executive she
should not be subject to deposition until all other means of
discovery have been exhausted is simply incorrect. The
so-called “Apex” doctrine on which defendant
relies “is normally aimed at high level decision makers
who have no particular direct knowledge of the facts
pertaining to the particular lawsuit.” Wal-Mart
Stores, Inc. v. Vidalakis, 5:07MC00039-RTD, 2007 WL
4591569 (W.D. Ark. Dec 28, 2007). Plaintiff has made a
threshold showing that Dr. Maryland has direct knowledge of
facts pertaining to this case: she was critical of the CPS
contract and directly expressed her criticism to the ...