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Ortiviz v. Follin

United States District Court, D. Colorado

July 19, 2017

ENRIQUEZ L. ORTIVIZ, Plaintiff,
v.
RALPH E. FOLLIN, and NATIONAL FREIGHT, INC., a/k/a National Freight and Logistics, Inc., Defendants.

          ORDER

          Michael E. Hegarty, United States Magistrate Judge.

         Movant Marrick Medical Finance, LLC seeks to quash National Freight, Inc.'s subpoena. ECF No. 29. Marrick's motion is fully briefed, and the Court finds that oral argument will not assist in its adjudication. Because the information the subpoena seeks is arguably not subject to the collateral source rule, and it is relevant and proportional to this case, the Court denies Marrick's motion to quash.

         BACKGROUND

         On August 23, 2016, Plaintiff Enriquez Ortiviz filed the operative Amended Complaint in state court against Ralph Follin and National Freight and Logistics, Inc. ECF No. 5. Mr. Ortiviz asserts he was injured in an automobile collision on February 8, 2014. Id. at ¶ 6. According to Mr. Ortiviz, while Mr. Follin was driving in his capacity as an employee of National Freight, Mr. Follin changed lanes on Interstate 25 and collided with Mr. Ortiviz's vehicle. Id. at ¶¶ 8-21, 25. As a result, Mr. Ortiviz suffered physical injuries, and his vehicle was damaged. Id. at ¶¶ 24-31, 44.

         To pay for his substantial physical injuries, Mr. Ortiviz entered into an agreement with Marrick. ECF No. 29-5. Pursuant to this agreement, Marrick paid Mr. Ortiviz's medical bills at a discounted rate it negotiated with the providers. Id. In return, Mr. Ortiviz granted Marrick a lien for the full amount of his medical bills on any future damages he recovers from Defendants. Id.

         Mr. Ortiviz asserts causes of action for negligence and negligence per se against Mr. Follin. Id. at ¶¶ 42-55. Additionally, Mr. Ortiviz pleads a respondeat superior claim against National Freight. Id. at ¶¶ 56-59. Defendants removed the case to this District on October 13, 2016. ECF No. 1. The parties have been participating in discovery since they made their initial disclosures on November 15, 2016. Scheduling Order 4, ECF No. 26.

         On March 4, 2017, National Freight served a subpoena on Marrick, which requests documents that include the discounted amount Marrick paid to Mr. Ortiviz's medical providers. Marrick's Mot. to Quash 3, ECF No. 29; Subpoena to Produc. Docs., ECF No. 29-1. National Freight seeks to use this information to show the reasonable value of Mr. Ortiviz's medical expenses. See National Freight's Resp. to Marrick's Mot. 11, ECF No. 41. Marrick contends the amount it pays medical providers is inadmissible collateral source information. Marrick's Mot. to Quash 7-9. According to Marrick, it is a collateral source, because it is wholly independent from the tortfeasor, and it paid for Mr. Ortiviz's medical expenses after the accident. Id. Therefore, Marrick contends the information is not discoverable under Colorado law. Id. Additionally, Marrick argues the information is irrelevant and unduly prejudicial. Id. at 8-13.

         National Freight asserts Marrick is not a collateral source, because Marrick did not provide a benefit to Mr. Ortiviz. National Freight's Resp. to Marrick's Mot. to Quash 5-11. Unlike an insurance company, Mr. Ortiviz remains liable to Marrick for the full cost of his medical bills. Id. at 6. Therefore, according to National Freight, there is no concern that the information will cause the jury to reduce the amount of any judgment Mr. Ortiviz receives. Id. Additionally, National Freight argues that amount paid for medical expenses is relevant to the reasonable value of the medical care, and disclosure of the information does not unduly prejudice Marrick. Id. at 11-17. Marrick filed a Reply in Support of its Motion on June 26, 2017. ECF No. 42. Marrick contends it provides a benefit to its clients, because it “sometimes negotiates its lien balances.” Id. at ¶ 3.

         LEGAL STANDARDS

          I. Rule 26(b)(1)

         “[T]he scope of discovery under the federal rules is broad.” Gomez v. Martin Marietta Corp., 50 F.3d 1511, 1520 (10th Cir. 1995). Federal Rule of Civil Procedure 26(b)(1) permits discovery regarding any nonpriviliged matter that is relevant to a party's claim or defense and proportional to the needs of the case. Federal Rule of Evidence 401 defines relevant evidence as “evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more or less probable than it would be without the evidence.” In considering whether the discovery is proportional to the needs of the case, Rule 26(b)(1) instructs courts to analyze “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). The party objecting to discovery must establish that the requested information does not fall under the scope of discovery as defined in Fed. R. Civ. P 26(b)(1). Simpson v. University of Colo., 220 F.R.D. 354, 359 (D. Colo 2004).

         II. Rule 45

          A subpoena served on a third party pursuant to Rule 45 of the Federal Rules of Civil Procedure is subject to the same standards that govern discovery between the parties-it must seek relevant information and be proportional to the needs of the case. Segura v. Allstate Fire & Cas. Ins. Co., No. 16-cv-00047-NYW, 2016 WL 8737864, at *5 (D. Colo. Oct. 11, 2016) (citing Rice v. United States, 164 F.R.D. 556, 556-57 (N.D. Okla. 1995)). Rule 45 requires courts to quash a subpoena that “(i) fails to allow a reasonable time to comply, (ii) requires a person to comply beyond the geographical limits specified in Rule 45(c), (iii) requires disclosure of privileged or other protected matter, if no exception or waiver applies; or (iv) subjects a person to ...


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