Opinion
Civil Action No. 96-CV-4346.
August 18, 2004
MEMORANDUM ORDER
Presently before the Court is the Motion in Limine to Preclude and Limit Certain Trial Evidence Filed by Defendants Eric Gewirtz, M.D., Steven Palloni, M.D., Barry Wilderman, M.D., and Barry Wilderman, M.D., P.C. (Doc. No. 140.) For the following reasons, we will grant Defendants' Motion.
I. BACKGROUND
A. Relator's Allegations
Relator Deborah Riva Magid, Ph.D., M.D., ("Relator") brings this qui tam action under the False Claims Act, 31 U.S.C. §§ 3729, et seq., on behalf of herself and the United States. Relator worked as an anesthesiologist for Defendant Barry Wilderman, M.D., P.C. ("Wilderman, P.C."), from July 11, 1994 through late May, 1996. (Doc. No. 114, Ex. B at 180.) At all times relevant to this case, Wilderman, P.C., was a corporation that was the sole provider of anesthesiarelated services for patients of North Penn Hospital ("North Penn"). Defendants Barry Wilderman, M.D., Eric Gewirtz, M.D., and Steven Palloni, M.D., all worked with Relator as anesthesiologists for Wilderman, P.C.
In December, 1995, Relator allegedly discovered that Defendants were submitting false claims to the United States for reimbursement from its Medicare program. (Compl. ¶ 3.) Relator discovered that an operating room record for a patient she tended to had been altered to reflect the providing of services that had not been provided. Upon inquiry to a certified registered nurse anesthetist with whom she worked, Relator was informed that Defendants routinely altered operating room records to falsely reflect the amount of services and/or time for which Defendants could bill Medicare. Relator reviewed records available to her and discovered that Defendants were submitting HCFA-1500 claim forms to Medicare that overstated the actual time that Relator performed and/or directed Medicare covered services. The same pattern of alteration appeared on patient records dating back to 1990. ( Id.)
HCFA-1500 forms are used by physicians to request reimbursement from Medicare for services.
After consulting her legal counsel, Relator informed Defendants by letter that she believed that they had violated the False Claims Act and urged them to take appropriate action. (Doc. No. 114, Ex. I.) Relator was not satisfied with Defendants' response and filed this qui tam action pursuant to 31 U.S.C. § 3730(b). In the complaint, Relator alleges that Defendants engaged in a practice of submitting false claims for reimbursement from Medicare.
B. Prior Proceedings
31 U.S.C. § 3730(b) provides in relevant part: "A person may bring a civil action for a violation of [the False Claims Act] for the person and for the United States Government."
Relator also alleged that North Penn was liable for violations of the False Claims Act. On April 29, 2004, we granted North Penn's motion for summary judgment and dismissed North Penn from this case. (Doc. No. 137.)
Relator filed the complaint on June 13, 1996. The United States declined to intervene in this case on January 22, 1997. (Doc. No. 3.) On May 5, 1998, the Court denied North Penn's motion to dismiss. (Doc. No. 13.) On May 15, 1998, the Court entered a Scheduling Order requiring the parties to complete discovery by November 2, 1998. (Doc. No. 14.) The parties requested and the Court granted several extensions of the discovery deadline. On October 24, 2000, the Court issued its final Scheduling Order. That Order required the parties to complete all discovery by December 29, 2000. (Doc. No. 104.) Discovery was completed on that date.
On March 29, 2002, Defendants' motion to strike portions of Relator's expert report was granted in part and denied in part. (Doc. No. 109.) On April 16, 2002, a Daubert hearing was held to assess the admissibility of the rest of Relator's expert report and the testimony of Relator's experts. Relator's experts claimed that by using a statistical analysis they could analyze a sample set of 200 out of the approximately 9,700 claims that Defendants submitted to Medicare and, after identifying the overcharges in that sample set, determine the total amount Medicare was overcharged on the 9,700 claims. Relator's experts ultimately identified 198 such instances. On September 12, 2002, we concluded that the statistical analysis used in Relator's expert report was flawed. An Order was entered directing that Relator's experts could only testify as to the existence of overcharging in the claims they actually reviewed. (Doc. No. 113.)
On December 13, 2002, North Penn moved for summary judgment. (Doc. No. 114.) We allowed the remaining Defendants to join that motion on March 31, 2003. (Doc. No. 125.) In their motion, Defendants argued that they were entitled to summary judgment on Relator's claims that Defendants overcharged Medicare because Relator and her experts never reviewed the HCFA-1500 claim forms that Defendants submitted to Medicare for reimbursement. In other words, Relator and her experts never reviewed the actual claims that they alleged were false. Instead, Relator's experts determined that Defendants submitted false claims to Medicare by examining the Explanation of Medicare Benefits forms ("EOMBs") that Defendants received back from Medicare after they had submitted claims for reimbursement. EOMBs are provided by Medicare to doctors when the doctors receive reimbursement from Medicare. Thus, Relator relies on the EOMBs as circumstantial evidence that Defendants submitted false claims to Medicare via the HCFA-1500 claim forms. In their motion for summary judgment, Defendants argued that Medicare could have made errors when transferring data from the HCFA-1500 claim forms to the EOMBs. Thus, Defendants argued, the EOMBs would not accurately reflect the claims submitted by Defendants to Medicare. Defendants, did not, however, argue that we could not consider the EOMBs in assessing whether Relator had raised a genuine issue of material fact necessary to survive summary judgment. We denied Defendants' motion for summary judgment, stating:
Proving the contents of the HCFA-1500 claim forms would seem to be critical to Relator's case. To establish a violation of the False Claims Act, Relator must prove that "(1) the defendant presented or caused to be presented to an agent of the United States a claim for payment; (2) the claim was false or fraudulent; and (3) the defendant knew the claim was false or fraudulent." Hutchins v. Wilentz, Goldman Spitzer, 253 F.3d 176, 182 (3d Cir. 2001).
While Defendants may appropriately raise th[e] [admissibility] issue at trial, Defendants have failed to meet the burden of demonstrating that no genuine issue of material fact exists. While Defendants believe that the EOMBs could have different information than the HCFA-1500 forms that were submitted by Defendants to Medicare, [Relator's expert] testified that in her twenty-six years of experience, such errors occurred only "occasionally." (Doc. No. 124, Ex. 2 at 35.) She also testified that if errors occurred, the doctor would have the error corrected. ( Id.) We are satisfied at this juncture that a genuine issue of material fact exists as to whether the data in the HCFA-1500 forms is the same as the data in the corresponding EOMBs. United States ex rel. Magid v. Wilderman, No. 96-4346, 2004 WL 945153, at *7 (E.D. Pa. Apr. 29, 2004).
C. Defendants' Motion in Limine
Defendants now move in limine to exclude the EOMBs from trial, arguing that they are not the best evidence of the claims submitted by Defendants to Medicare. Defendants also argue that Relator did not use reasonable means to locate and produce the HCFA-1500 claim forms, and request that we hold a hearing to determine as a factual matter whether those forms are "lost or have been destroyed," or whether "[n]o original can be obtained by any available judicial process or procedure. . . ." FED. R. EVID. 1004(1) (2). We are satisfied that a hearing is unnecessary. Based on the undisputed facts gleaned from the parties' submissions, it is clear that the forms are not lost or destroyed, and that Relator could have obtained them by available judicial process. Furthermore, it is clear that Relator did not use reasonable and diligent means to obtain the forms. Under the circumstances, we conclude that the EOMBs are not admissible under any of the exceptions to the best evidence rule found in Federal Rule of Evidence 1004, and we will exercise our discretion to exclude the EOMBs from evidence.
II. THE BEST EVIDENCE RULE
Federal Rule of Evidence 1002, commonly referred to as the best evidence rule, provides as follows:
To prove the content of a writing, recording, or photograph, the original writing, recording, or photograph is required, except as otherwise provided in these rules or by Act of Congress.
FED. R. EVID. 1002. Rule 1004 provides limited exceptions to the best evidence rule:
The original is not required, and other evidence of the contents of a writing, recording, or photograph is admissible if —
(1) Originals lost or destroyed. All originals are lost or have been destroyed, unless the proponent lost or destroyed them in bad faith; or
(2) Original not obtainable. No original can be obtained by any available judicial process or procedure; or
(3) Original in possession of opponent. At a time when an original was under the control of the party against whom offered, that party was put on notice, by the pleadings or otherwise, that the contents would be a subject of proof at the hearing, and that party does not produce the original at the hearing; or
(4) Collateral matters. The writing, recording, or photograph is not closely related to a controlling issue.
FED. R. EVID. 1004. Whether a writing is admissible under any of the exceptions in Rule 1004 is to be determined by the court. FED. R. EVID. 1008; see also Remington Arms Co. v. Liberty Mut. Ins. Co., 810 F. Supp. 1420, 1426 (D. Del. 1982). The decision whether to admit a writing under any of the exceptions in Rule 1004 is left to the discretion of the trial judge. Wright v. Farmers Co-Op of Arkansas Okla., 681 F.2d 549, 553 (8th Cir. 1982) (citing 5 J. WEINSTEIN M. BERGER, WEINSTEIN'S EVIDENCE § 1004(1)(5)(2) (1978)); United States v. Shoels, 685 F.2d 379, 384 (10th Cir. 1982); see generally Quinn v. Consolidated Freightways Corp. of Del., 283 F.3d 572, 576 (3d Cir. 2002) ("Trial judges are afforded wide discretion in making rulings on the admissibility of evidence.").
It is clear that the best evidence rule is implicated by Relator's intention to introduce the EOMBs at trial as circumstantial evidence of the contents of the HCFA-1500 claim forms. The HCFA-1500 claim forms are "original writings" as defined in Rule 1001. FED. R. EVID. 1001(1) (2). To prove the content of a writing, the original writing is required, unless some exception applies. FED. R. EVID. 1002. Relator argues that the HCFA-1500 claim forms are both "lost" or "destroyed," see FED. R. EVID. 1001(1), and "[un]available [by] judicial process or procedure," see FED. R. EVID. 1001(2). Relator contends that an administrator for Medicare, Highmark, Inc. ("Highmark"), "is in the process of retrieving microfiche copies of the HCFA 1500 forms." (Doc. No. 144 at 1.) According to Relator, "the original[s] would take a longer period of time to identify and locate than would retrieval of the microfiche." ( Id. at 2.) Thus, the HCFA-1500 claim forms, and duplicates thereof, have not been destroyed. They exist and can be located with some effort. On July 23, 2004, we granted Relator's uncontested motion for the entry of an order directing that Highmark produce the HCFA-1500 claim forms within ten days. (Doc. No. 143.) On August 11, 2004, Relator claims that Highmark represented that retrieving microfiche copies of those forms would take several weeks. ( Id. at 1-2.) It is likely, then, that neither the original HCFA-1500 claim forms nor microfiche copies thereof will be available in time for trial on August 23, 2004. Thus, the question presented here is, under the circumstances of this case, and given the fact that Highmark claims it is unable to comply with this Court's Order of July 23, 2004, to produce the HCFA-1500 claim forms in time for trial, are those forms therefore "lost" or "[un]available [by] judicial process or procedure."
It is likely that such microfiche copies would be admissible as "duplicate[s]" of the original HCFA-1500 claim forms. FED. R. EVID. 1003.
Relator moved for entry of that Order on July 19, 2004. (Doc. No. 142.)
Cases decided both before and after the adoption of the Federal Rules of Evidence in 1975 state that a party seeking to admit a secondary writing as evidence of the original must convince the court that he or she made a reasonable, diligent, and unsuccessful search for the original. See, e.g., Burt Rigid Box, Inc. v. Travelers Prop. Cas. Corp., 302 F.3d 83, 91-92 (2d Cir. 2002) (noting that to admit secondary evidence under Rule 1004 the proponent must "demonstrate that it has made a diligent but unsuccessful search and inquiry for the missing [original]") (quotations omitted); Cartier v. Jackson, 59 F.3d 1046, 1048 (10th Cir. 1995) (affirming district court's decision to exclude secondary evidence on the grounds that the proponent failed to conduct a diligent search for original version); United States v. McGaughey, 977 F.2d 1067, 1071 (7th Cir. 1992) ("Rule 1004 does not contain an independent requirement that a search be conducted; rather, the concept of a diligent search is an avenue by which the larger issue of the document's destruction may be proved."); Sylvania Elec. Prods., Inc. v. Flanagan, 352 F.2d 1005, 1008 (1st Cir. 1965) ("[S]econdary evidence of the content of the original is not admissible unless the proponent of the testimony shows that a reasonable and diligent search has been made for the original without success.") (citing Simpson Co. v. Dall, 70 U.S. 460, 475 (1865)). Accordingly, we will review the efforts that Relator made to obtain the HCFA-1500 claim forms and assess whether Relator acted reasonably and with diligence.
In reviewing those efforts, we will accept Relator's representations as accurate.
On August 12, 1998, Relator served a request for production of documents on Defendants and a subpoena on the United States requesting the HCFA-1500 claim forms. (Doc. No. 144 at 4.) Defendants responded on November 19, 1998, stating that they did not maintain copies of those forms. ( Id.) In response to Relator's subpoena, the United States stated that problems associated with the so-called "Y2K" computer glitch prevented it from producing the HCFA-1500 claim forms before June, 2000. ( Id. at 5.) As an alternative, the United States produced to Relator the EOMBs. ( Id.)
Relator filed a motion to compel in connection with its request for production of documents which the Court granted on March 23, 1999. (Doc. No. 34.) However, Defendants still did not produce any HCFA-1500 claim forms because those forms were purportedly not in Defendants' possession. (Doc. No. 144 at 4.)
Discovery in this matter was not complete until December 29, 2000. (Doc. No. 104.) Apparently, Relator never followed up with the United States regarding the HCFA-1500 claim forms prior to the close of discovery, despite the representation of the United States' that those forms might be available in June, 2000. On December 13, 2002, North Penn moved for summary judgment. (Doc. No. 114.) We allowed the remaining Defendants to join that motion on March 31, 2003. (Doc. No. 125.) In support of their motion for summary judgment, Defendants argued that the information in the EOMBs might be different from the information in the HCFA-1500 claim forms. In our Memorandum and Order dated April 29, 2004, we denied Defendants' motion for summary judgment, but noted that Defendants could appropriately challenge the admissibility of the EOMBs at trial. At this point, Relator should have been on notice that Defendants would object to the admissibility of the EOMBs based on the best evidence rule. Any doubts that Relator might have had were erased on May 19, 2004, when Defendants moved to exclude the EOMBs under Rule 1002. (Doc. No. 140.) Relator failed to invoke judicial process in an effort to secure the HCFA-1500 claim forms until July 19, 2004. (Doc. No. 142.) By then, Highmark was unable to produce microfiche copies of the HCFA-1500 claim forms in time for trial on August 23, 2004. However, based on Relator's representation that retrieving the copies would take "several weeks, [but not] months," (Doc. No. 144 at 1-2), it seems clear that Relator could have obtained the forms in time for trial had she sought those forms by judicial process when she became aware that Defendants were challenging the admissibility of the EOMBs on May 19, 2004. Doing so would have been both reasonable and diligent. Moreover, Relator should have been aware of the evidentiary problem and attempted to obtain the forms as early as June, 2000, when the United States informed her they might be available. Under the circumstances, we are compelled to conclude that Relator's efforts to obtain the HCFA-1500 claim forms were not reasonable or diligent and fell below the standard required by Rule 1004 and the applicable caselaw.
We note that while Relator does not argue that the HCFA-1500 claim forms are admissible under Fed.R.Evid. 1004(3) on the grounds that they are in the possession of her opponent, Relator does state that counsel for Defendants represented that during the pendency of this litigation he saw the HCFA-1500 claim forms in the possession of North Penn. (Letter of John F. Innelli, dated August 15, 2004, at n. 1.) Counsel for Defendants states that he saw HCFA-1500 claim forms while at North Penn, but does not know whether they were the forms requested by Relator. (Letter of Arthur R. Shuman, dated August 17, 2004, at 1.) Respondent suggests that counsel for Defendant's recollection is becoming purposefully "muddied". (Letter of John F. Innelli, dated August 17, 2004.) In any event, at all times during this litigation North Penn and the present Defendants have been represented by different counsel. Thus, even if counsel for Defendants saw the relevant forms in the possession of North Penn, he would not have been obligated to turn those forms over to Relator. Rather, it was Relator's obligation to use reasonable and diligent means to obtain those forms.
We also conclude that the EOMBs are not admissible under Rule 1004(2), even though on two occasions Relator unsuccessfully attempted to obtain the HCFA-1500 claim forms by judicial process. Rule 1004(2) and the advisory committee's notes appended thereto state that secondary evidence may be admitted if "[n]o original can be obtained by any available judicial process or procedure. . . ." FED. R. EVID. 1004(2); advisory committee's notes ("When the original is in the possession of a third person, inability to procure it from him by resort to process or other judicial procedure is a sufficient explanation of nonproduction."). However, cases assessing whether secondary evidence may be admitted under Rule 1004 require that the proponent of the evidence demonstrate that he or she has made a reasonable, diligent, and unsuccessful inquiry for the original. See, e.g., Burt Rigid Box, 302 F.3d at 91; Rosenberg v. Neubeck, No. 96-20174 SW, 1997 WL 33014, at *2 (N.D. Cal. Jan. 15, 1997) (construing subsections (1) and (2) of Rule 1004) ("To satisfy Fed.R.Evid. 1004 the proponent of the evidence must show that a reasonable and diligent search has been made for the original without success.") (citing Sylvania Elec. Prods., 352 F.2d at 1008). Even though Relator twice invoked the judicial process in an attempt to obtain the HCFA-1500 claim forms, we conclude that those efforts were not reasonable and diligent for the following reasons. Relator first attempted to obtain the HCFA-1500 claim forms by serving the United States with a subpoena requesting those forms. The United States responded that the HCFA-1500 claim forms would not be available before June, 2000, and delivered the EOMBs as an alternative. There is no evidence or suggestion that Relator ever objected to the United States' production of the EOMBs as an alternative to the HCFA-1500 claim forms. Moreover, it appears that Relator did not follow up with the United States regarding the HCFA-1500 claim forms prior to the close of discovery, despite the representation of the United States' that those forms might be available in June, 2000. These efforts were neither reasonable nor diligent. Relator's next attempt to obtain the HCFA-1500 claim forms by resort to judicial process was on July 19, 2004, when she moved this Court for an order requiring Highmark to produce those forms within ten days. However, considering the fact that Relator filed this motion two months after Defendants filed their motion in limine, and only five weeks before the scheduled trial date, we conclude that this effort was neither reasonable nor diligent. Under the unique circumstances of this case, we are compelled to conclude that the EOMBs do not fit any of the exceptions to the best evidence rule found in Rule 1004, and therefore must be excluded from evidence.
An appropriate Order follows.
ORDER
AND NOW, this 18th day of August, 2004, upon consideration of the Motion in Limine to Preclude and Limit Certain Trial Evidence Filed by Defendants Eric Gewirtz, M.D., Steven Palloni, M.D., Barry Wilderman, M.D., and Barry Wilderman, M.D., P.C. (Doc. No. 140), and all papers filed in support thereof and opposition thereto, it is ORDERED that the Motion is GRANTED.IT IS SO ORDERED.