United States District Court, D. New Jersey
OPINION AND ORDER
B. CLARK, III UNITED STATES MAGISTRATE JUDGE.
MATTER comes before the Court on a motion by
Defendants to quash two subpoenas served by Plaintiffs [ECF
No. 58]. Plaintiffs oppose Defendants' motion [ECF No.
61]. For the reasons set forth below, Defendants' Motion
to Quash [ECF No. 58] is DENIED.
FACTUAL BACKGROUND & PROCEDURAL HISTORY
Government Employees Insurance Co., Geico Indemnity Co.,
Geico General Insurance Company, and Geico Casualty Co.
(collectively “Geico” or
“Plaintiffs”) initiated this action on August 2,
2016 by filing their Complaint against Stephen Trnovski, M.D.
(“Dr. Trnovski”), Roman Kosiborod, D.O.
(“Dr. Kosiborod”), Aron Rovner, M.D. (“Dr.
Rovner”), Albert Akkerman, M.D., Alliance Spine
Associates, LLC (“Alliance Spine”), (collectively
the “Alliance Defendants”), and New Horizon
Surgical Center, LLC (“New Horizon”).
See Complaint, ECF No. 1. According to
Plaintiffs' Complaint, New Horizon and the Alliance
Defendants were wrongfully compensated after they submitted
hundreds of fraudulent no-fault insurance charges to Geico.
Id. ¶ 1. Based on these allegations, Plaintiffs
assert a claim for a declaratory judgment, seeking a
declaration that Alliance Spine and New Horizon have no right
to receive payment for any pending bills submitted to Geico.
Id. ¶ 332. Plaintiffs also assert various
claims for violations of the New Jersey Insurance Fraud
Prevention Act (“NJIFPA”) and the Racketeer
Influenced and Corrupt Organizations Act
(“RICO”), for common law fraud, for aiding and
abetting fraud, and for unjust enrichment. See Id.
September of 2016, New Horizon and the Alliance Defendants,
with the exception of Dr. Rovner, filed motions to dismiss
Plaintiffs' Complaint. See ECF Nos. 13, 20.
Before a decision could be rendered on the motions, the Court
administratively terminated the motions to allow the parties
time to engage in meaningful settlement discussions.
See ECF No. 37. Shortly thereafter, New Horizon and
Plaintiffs reached an agreement to settle their claims, and
in January of 2018, New Horizon was dismissed from the case.
See ECF No. 40. Plaintiffs and the Alliance
Defendants were not able, however, to resolve their issues.
Therefore, all claims against the Alliance Defendants are
March 29, 2018, the Alliance Defendants filed the present
Motion to Quash. ECF No. 58. The Motion to Quash relates to
two subpoenas (the “Subpoenas”) served by
Plaintiffs on non-parties TD Bank and Bank of America (the
“Non-Party Banks”). The Subpoenas seek the
production of documents related to any account that has been
maintained by Alliance Spine. See ECF No. 61-2 at 3,
6. Specifically, the Subpoenas seek copies of “all
deposit and/or withdrawal slips, canceled checks, transaction
statements, electronic fund transfers, account ledgers,
account information and governance documents, corporate
resolutions, signature cards, powers of attorney and all
correspondence related to the accounts.” Id.
support of their Motion to Quash, the Alliance Defendants
argue that the Subpoenas are improper, overbroad, and are
“wholly irrelevant to the claims of fraudulent billing
and lack of medical necessity that are asserted by Plaintiffs
in this action.” ECF No. 58-1. In opposition to the
Motion to Quash, Plaintiffs argue that: (1) Alliance
Spine's corporate financial records are highly relevant
to the claims and defenses asserted in this action; (2) the
Subpoenas are not overbroad; and (3) the Alliance Defendants
have failed to meet their burden of establishing that the
materials sought by the Subpoenas are privileged and
confidential. See ECF No. 61.
Rule of Civil Procedure 26 governs the scope of discovery in
federal litigation and provides that:
Parties 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. Information within this scope of discovery need not
be admissible in evidence to be discoverable.
Fed. R. Civ. P. 26(b)(1). Rule 26 is to be construed
liberally in favor of disclosure, as relevance is a broader
inquiry at the discovery stage than at the trial stage.
Tele-Radio Sys. Ltd. v. De Forest Elecs., Inc., 92
F.R.D. 371, 375 (D.N.J. 1981). While relevant information
need not be admissible at trial in order to grant disclosure,
the burden remains on the party seeking discovery to
“show that the information sought is relevant to the
subject matter of the action and may lead to admissible
evidence.” Caver v. City of Trenton, 192
F.R.D. 154, 159 (D.N.J. 2000). Upon a finding of good cause,
a court may order discovery of any matter relevant to a
party's claims, defenses or the subject matter involved
in the action. “Although the scope of discovery under
the Federal Rules is unquestionably broad, this right is not
unlimited and may be circumscribed.” Bayer AG v.
Betachem, Inc., 173 F.3d 188, 191 (3d Cir. 1999).
Discovery requests may be curtailed to protect a person from
whom discovery is sought from “annoyance,
embarrassment, oppression, or undue burden or expense.”
sought via a subpoena issued pursuant to Rule 45 must fall
within the scope of discovery permissible under Rule 26(b).
OMS Investments, Inc. v. Lebanon Seaboard Corp.,
2008 WL 4952445 (D.N.J. Nov. 18, 2008). Federal Rule of Civil
Procedure 45(c)(3)(A)(iii) provides that “the issuing
court must quash or modify a subpoena that . . . requires
disclosure of privileged or other protected matter, if no
exception or waiver applies . . ..” Moreover, an
“issuing court may . . . quash or modify the subpoena
if it requires disclosing a trade secret or other
confidential research, development, or commercial
information.” Fed.R.Civ.P. 45(c)(3)(B).