Judge Margaret L. Oldendorf, Case 22AHCV00329 2023-02-02 Tentative Ruling

Judge: Margaret L. Oldendorf, Case: 22AHCV00329, Date: 2023-02-02 Tentative Ruling

Before the Court is a motion to compel further responses to documents. The Court concludes that the objections interposed to the requests by the cross-defendants are not well-taken. The motions are therefore granted.

Code Civ. Proc. §2031.310 provides that if a demanding party deems responses to a demand for inspection to be incomplete or evasive or an objection to be too general or without merit, the demanding party may move for an order compelling further responses. The motion must show good cause justifying the discovery and must be accompanied by a meet and confer declaration. Any motion for further responses must be made within 45 days of the verified response or any supplemental response. Further, this section provides that a court shall impose a monetary sanction against any party, person, or attorney who unsuccessfully makes a motion to compel further responses unless the court finds that the one subject to sanction acted with substantial justification or that other circumstances make imposition of a sanction unjust.

Case law has established that several areas of an individual’s life are entitled to privacy, among them are privacy in one’s financial records, medical records, and employment records. This privacy interest is not absolute and must sometimes yield if a balancing of interests so requires. Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1 sets forth the process. First, a legally protected privacy right must be identified, in which the party has a reasonable expectation to privacy, the threatened invasion of which is serious rather than trivial. If these facts exist, courts must balance the invasion of that privacy with the competing interests. “Privacy concerns are not absolute; they must be balanced against other important interests. . . . Invasion of a privacy interest is not a violation of the state constitutional right to privacy if the invasion is justified by a competing interest. Legitimate interests derive from the legally authorized and socially beneficial activities of government and private entities.” Id. at 37-38.

Dezhong Liu (Dezhong)[1] and Sufen Liu (Sufen) filed their action Jim Yingjian Wu (Wu) on June 2, 2022. They allege that they loaned $334,696.48 to Wu for his business and that he failed to repay the money. The complaint contains causes of action for breach of contract, common count for money lent, and fraud. In support of the prayer for punitive damages Dezhong and Sufen allege that when it became clear to Wu that they were not going to loan him any more money, Wu filed for divorce from their daughter and denied that the money had been a loan.

On September 9, 2022, Wu answer and filed a cross-complaint. The cross-complaint includes Wu’s ex-wife Linda Qiao (Qiao) as a cross-complainant and names as cross-defendants Dezhong, Sufen, and their daughter Fangqin Liu (Fangqin). Wu, a medical doctor, alleges that he married Fangqin in August 2020. He alleges that in hindsight he can see that Fangqin saw him an easy mark whom she and her family could fleece. Wu alleges that shortly after their wedding Fangin told him she had experience working at a med spa and that opening one would be a good investment for them. A medical license is needed in order to open a med spa. Wu agreed to this plan and formed AC Medical Group, Inc., opened a bank account, and leased office space all for the operation of this business. Unbeknownst to him, Fangqin used his medical license and DEA number to order medications and drugs from overseas, including restricted products. When he learned of this Wu became concerned that Fangqin was putting patients’ safety at risk and his medical license in jeopardy. Wu filed for divorce and began the process of closing down the business.

Wu alleges that in retaliation for him filing for divorce and closing the business, Fangqin and her parents orchestrated a coordinated attack to ruin him and destroy his practice. In furtherance of the plan, Cross-Complainants filed complaints with the Medical Board about him, some concerning them, two on behalf of the Fangqin’s children from a prior marriage, and two others by former patients Wu had treated for acne over a year prior. Wu alleges that cross-complainants also filed a complaint in the name of his former wife, Qiao. All of the complaints are fabricated. Many make similar allegations, including insurance fraud, illegal kickbacks, illegal referrals, sexual misconduct, drug and alcohol abuse, and negligence.

Wu alleges that these false filings resulted in the Medical Board making an unannounced visit to Wu’s practice while he was in the midst of treating a patient. They required a urine test, which was clean. But this has caused him embarrassment and thousands of dollars in legal fees to resolve matters with the Medical Board.

In his breach of fiduciary duty cause of action Wu alleges that Fangqin shut him out of the med spa business, refused to let him have a key and refused to provide any information about the costs or profits of the business. He alleges she ordered medications without his permission using his medical license and siphoned off a yet to be determined amount of cash.

In the conversion cause of action Wu alleges that as he was moving to shut down AC Medical, Fangqin secretly moved all the medical assets to a new corporation, named AC Aesthetic Group, Inc., at the same location as the old business and engaging in the same business. All equipment and cash of the business were converted and Fangqin continued to see patients even though Wu had resigned as the supervising physician of AC Medical.

The third cause of action is for defamation. Here Wu alleges that in retaliation for him filing for divorce and closing down the business, Dezhong, Sufan, and Fangqin filed eight false complaints with the medical board. Details of those reports are set forth in the pleading.

The fifth cause of action is for fraud. Here Wu alleges on information and belief that sometime during his marriage Dezhong and Sufan funneled approximately $330,000 to Fangqin without his knowledge. Wu alleges he does not know what she did with the money. He alleges that this is the money Dezhong and Sufan allege in their pleading was a loan to him.

The sixth cause of action is for total equitable indemnity and the seventh is for partial equitable indemnity. Wu alleges that if he is found liable at all in the main action he is entitled to indemnify from Fangqin.

Wu offers his declaration in support of this motion. Wu declares that he is a Board-Certified medical doctor who has been practicing in the United States for 23 years. He was married to Linda Qiao from 1986 to 2017 and since the divorce they have remained friends. Wu married Fangqin in August 2020 and filed for divorce a little over a year later. Wu states that in January 2021, Fangqin, her mother and father (Sufen and Dezhong), as well as her two sons from a prior marriage (Bowen Li and Primo Li) all contracted Covid and he treated them all. Wu states he did this for free and without billing their insurance companies. Wu states that all of them were grateful and none complained about the care he provided.

In June 2022, Wu learned from Qiao that she had received a letter from the Medical Board about a complaint she had allegedly made about him. Wu states he inquired with the Medical Board about this and that is when he learned that 8 complaints had been filed against him; a summary of the complaints as contained in the letter from the Medical Board is attached. Wu states that complaints were from Fangqin, Sufen, Dezhong, Bowen Li, Primo Li, Qiao, and two others who are not related to him or Fangqin, whom he treated once each for acne, for free.

Wu avers that he has been practicing medicine full time in the United States for 23 years and that other than these 8 complaints in May 2022, he has never been the subject of a Medical Board or any other governmental agency investigation.

Wu states that he has read the summary of the complaints provided to him by the medical board. Wu refutes the claims made therein. For example, to the allegation that he is an impaired physician who abuses alcohol, Wu avers that he does not consume alcohol and does not use recreational drugs or abuse prescribed medication. To the allegation of insurance fraud, Wu avers that he did not bill insurance for any of these patients. To the allegation that he was physically or sexually abusive to his estranged wife or her parents, Wu adamantly denies this and further, avers that he treated them all of them, as well as his estranged wife’s two sons, over the telephone.

Linda Qiao also provides a declaration. She declares that during the more than 36 years she has known Wu he has never consumed alcohol, never used recreational drugs, and never abused prescribed drugs. Qiao states she was shocked when she received the letter from the Medical Board because she never filed a complaint against Wu. She states that she has reported this to the Medical Board.

None of the Cross-Defendants filed a declaration. No evidence was offered in opposition to the motion.

On November 25, 2022, Wu served identical sets of Requests for Production of Documents on Dezhong, Sufan, and Fangqin. On December 31, 2022, he received their identical responses to the RFPs. Evidence of the parties’ meet and confer efforts are shown in the email exchanges attached to the Declaration of Mark T. Kawa. These motions were timely filed within 45 days of the responses.

1. All complaints personally filed by you with the Medical Board against Dr. Wu involving Dr. Wu’s treatment of you.

2. All complaints personally filed by you with the Medical Board against Dr. Wu involving Dr. Wu’s treatment of any person other than you.

5. All documents evidencing or summarizing any telephone calls or face-to-face conversations with a representative of the Medical Board regarding Dr. Wu.

Objection: This request violates California’s right of privacy, embodied in the California Constitution, Article I, Section 1 which provides, “All people are by nature free and independent and have inalienable rights. Among these are enjoying and defending life and liberty, acquiring, possessing, and protecting property, and pursuing and obtaining safety, happiness, and privacy. This request also violates the implied right of privacy, secrecy and/or confidentiality which exists as a result of the statutory scheme embodied in California Business & Professions Code § 800. Subsection (c) of that section provides that the identity of an information source is not to be disclosed by the Medical Board. Although “[t]he contents of any central file that not public records ... shall be confidential[,] .. .the licensee involved ... shall have the right to inspect and have copies made of his or her complete file except for the provision that mav disclose the identity of an information source.” Cal. Bus. & Prof. Code § 800(c)(1). [Emphasis added] This right of privacy, secrecy and/or confidentiality is analogous to the right of privacy, secrecy and confidentiality in State and Federal Tax Returns recognized in the State of California. Wilson v. Superior Court, 63 Cal. App. 3rd 825, 828 (1976); Webb v. Standard Oil Co., 49 Cal. 2nd 509, 512-513 (1957).

In their joint opposition brief Cross-Defendants raise additional objections based on the Confidentiality of Medical Information Act (Civ. Code §56 et seq.) and the federal Health Information Portability and Accountability Act (HIPAA). These new objections were waived and are not considered. When responding to discovery, a party must raise all objections and cannot “preserve” objections to be raised later. Scottsdale Ins. Co. v. Superior Court (1997) 59 Cal.App.4th 263, 273-274 (holding that even attorney-client privilege is waived if not raised in a party’s initial response). Wu makes this argument in his moving papers, anticipating that Cross-Defendants would attempt to raise new objections, which they do. Cross-Defendants fail to address this authority in their joint opposition brief.

“(c)(1) The contents of any central file that are not public records under any other provision of law shall be confidential except that the licensee involved, or the licensee’s counsel or representative, may inspect and have copies made of the licensee’s complete file except for the provision that may disclose the identity of an information source. For the purposes of this section, a board may protect an information source by providing a copy of the material with only those deletions necessary to protect the identity of the source or by providing a summary of the substance of the material. Whichever method is used, the board shall ensure that full disclosure is made to the subject of any personal information that could reasonably in any way reflect or convey anything detrimental, disparaging, or threatening to a licensee’s reputation, rights, benefits, privileges, or qualifications, or be used by a board to make a determination that would affect a licensee’s rights, benefits, privileges, or qualifications. The information required to be disclosed pursuant to Section 803.1 shall not be considered among the contents of a central file for the purposes of this subdivision.”

Cross-Defendants argue that the bolded language means the identity of a person complaining to the Board is subject to confidentiality. Wu counters that this statute only governs what the Board itself may disclose, not individuals. Cross-Defendants seem to acknowledge that this is so but urge the Court to “respect” the fact that the Board will not disclose the source of complaints by denying this document request.

Cross-Defendants cite no case law or other authority supporting this position. The Board has provided Wu with the names of each patient on behalf of whom a complaint was filed. If there were authority holding that a doctor cannot thereafter ask that patient to provide a copy of any complaints that patient filed, Cross-Defendants should have cited it.

As the parties resisting discovery, Cross-Defendants bear the burden of justifying their objections. Williams v. Superior Court (2017) 3 Cal.5th 531, 541; Fairmont Ins. Co. v. Superior Court (2000) 22 Cal.4th 245, 255 [“if a timely motion to compel has been filed, the burden is on responding party to justify any objection”].

Pursuant to Hill, for their privacy objections Cross-Defendants must establish a legally protected privacy interest, an objectively reasonable expectation of privacy, and a threatened intrusion that is serious. If they do, Cross-Complainants may raise “whatever legitimate and important countervailing interest disclosure serves.” Id. at 552. In opposing this motion Cross-Defendants make the argument that Wu has made an insufficient showing to overcome their privacy right. That argument skips over the threshold issue: Cross-Complainants bear the initial burden of establishing that a privacy right exists in the documents requested. None of the Cross-Defendants has offered any evidence supporting a claim of privacy in the documents requested.

At issue are complaints alleged to be fraudulently made with the Medical Board about Wu. Cross-Defendants have failed to adequately articulate a privacy interest in the identity of the complainant(s).

The motions to compel are granted. Cross-defendants are ordered (1) to provide further verified responses, without objection, to Wu’s Document Request Nos. 1-5; and (2) to produce the responsive documents within five (5) days of this ruling.

[1] Because three parties to this litigation share the same last name they are referred to by their first names here. No disrespect is intended. The opposition brief indicates that Sufen Liu has been erroneously named and that her name is Sufen Yu. The pleadings have not been amended to correct this.