Feinwachs v. Minnesota Hospital Association

          ORDER

          Wilhelmina M. Wright United States District Judge

         Before the Court is Plaintiff David Feinwachs's appeal of the April 5, 2019 Order of United States Magistrate Judge Steven E. Rau, which denied Feinwachs's motion for further consideration of sealing. Also before the Court are eight motions in limine-six filed by Feinwachs, (Dkts. 199, 212, 221, 333, 371), and two filed by Defendants The Minnesota Hospital Association (MHA) and its subsidiary MCCA, (Dkts. 380, 395). For the reasons addressed below, the April 5, 2019 Order is reversed and remanded, and the motions in limine are granted in part and denied in part.

         BACKGROUND

         MHA is a trade association that represents Minnesota hospitals and healthcare systems, and MHA's subsidiary, MCCA, is the organization that directly employs the people who perform the work of MHA. Until the termination of his employment in November 2010, Feinwachs served as MHA's general counsel and lobbyist.

         Feinwachs commenced this lawsuit in January 2011, asserting claims against multiple defendants under the federal False Claims Act (FCA), 31 U.S.C. §§ 3729 et seq., and the Minnesota False Claims Act (MFCA), Minn. Stat. §§ 15C.01 et seq. Over the nearly 9-year history of this lawsuit, multiple claims and defendants have been added and dismissed. At present, Feinwach's two retaliation claims against his former employers, pursuant to the FCA (Count Eight) and the MFCA (Count Nine), are the only remaining claims. Feinwachs alleges that Defendants unlawfully terminated his employment in retaliation for his efforts to stop what he believed to be Medicaid fraud being committed by healthcare companies in Minnesota. Defendants deny that Feinwachs was terminated in retaliation for efforts to stop Medicaid fraud, and they allege that instead Feinwachs was terminated for insubordination.

         Feinwachs and Defendants seek rulings on the admissibility of certain evidence at trial. The parties briefed and argued 36 motions in limine in late 2018, most of which were resolved at a November 7, 2018 hearing before Chief Judge John R. Tunheim. Currently before the Court are the motions in limine that were not resolved at that hearing and several additional motions in limine that the parties filed thereafter. In addition, Feinwachs appeals the magistrate judge's April 5, 2019 Order denying Feinwachs's motion for further consideration of sealing.

         ANALYSIS

         I. Plaintiff's Appeal of the April 5, 2019 Order

         The Court first addresses Feinwachs's appeal of the magistrate judge's April 5, 2019 Order. That order pertains to the unsealing of certain documents that contain or refer to emails that, according to Feinwachs, are protected by the attorney-client privilege and the work-product doctrine.

         A district court applies an “extremely deferential” standard of review to a magistrate judge's ruling on a nondispositive issue. Scott v. United States, 552 F.Supp.2d 917, 919 (D. Minn. 2008). Such a ruling will be modified or set aside only if it is clearly erroneous or contrary to law. 28 U.S.C. § 636(b)(1)(A); Fed.R.Civ.P. 72(a); LR 72.2(a)(3); Ferguson v. United States, 484 F.3d 1068, 1076 (8th Cir. 2007). A ruling is clearly erroneous when, “although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.” Wells Fargo & Co. v. United States, 750 F.Supp.2d 1049, 1050 (D. Minn. 2010) (internal quotation marks omitted). A ruling is contrary to law when it “fails to apply or misapplies relevant statutes, case law or rules of procedure.” Id. (internal quotation marks omitted).

         A. Factual and Procedural Background

         On May 19, 2010, and July 12, 2010, before the commencement of this lawsuit, Feinwachs's counsel emailed Feinwachs and his former co-plaintiff, David Kunz, on their respective personal email accounts. These two emails (hereinafter “the 2010 emails”) pertain to gathering evidence related to this lawsuit. Kunz subsequently forwarded these emails to Feinwachs, and MHA later discovered on its computer network the emails that Kunz had forwarded.

         In preparation for trial, the parties filed motions in limine in October 2018. These motions included Feinwachs's motion to exclude from evidence email communications between himself, Kunz, and their counsel, (Dkt. 217), and Defendants' motion to admit in evidence email communications between Feinwachs, Kunz, and their counsel, (Dkt. 201). Feinwachs opposed Defendants' motion, arguing that these emails are protected by the attorney-client privilege and work-product doctrine. Defendants countered that, because the emails were effectively disclosed to Defendants when the emails were forwarded to MHA's computer network, any such protections have been waived. At the November 7, 2018 hearing on the parties' motions in limine, Chief Judge Tunheim concluded that the emails found on MHA's computer network were “not private” and, therefore, not protected by the attorney-client privilege. Chief Judge Tunheim did not render a decision as to whether the work-product doctrine applies to any of the disputed emails.

         The parties filed a joint motion regarding continued sealing in December 2018, pursuant to Local Rule 5.6(d)(2), in which the parties disagreed about whether the 2010 emails should remain under seal. On February 8, 2019, the magistrate judge ordered the unsealing of memoranda, declarations, and exhibits that contain or address the 2010 emails. Thereafter, Feinwachs moved for further consideration of sealing, see LR 5.6(d)(3), arguing that documents that contain or discuss the 2010 emails should remain under seal because they are protected by the attorney-client privilege and the work-product doctrine.

         The magistrate judge denied Feinwachs's motion for further consideration of sealing. Relying on the law-of-the-case doctrine, the magistrate judge concluded that Chief Judge Tunheim's prior rulings on the parties' motions in limine at the November 7, 2018 hearing is controlling because prior rulings “should continue to govern the same issues in subsequent stages in the same case.” United States v. Carter, 490 F.3d 641, 644 (8th Cir. 2007) (quoting Arizona v. California, 460 U.S. 605, 618 (1983)). Because Chief Judge Tunheim previously deemed the 2010 emails to be “not private, ” the magistrate judge reasoned that Feinwachs cannot rely on the protections of either the attorney-client privilege or the work-product doctrine to support the continued sealing of these documents. Feinwachs argued that Chief Judge Tunheim had reserved ruling on whether the work-product doctrine applies to the 2010 emails, but the magistrate judge deemed this argument to be “irrelevant.” The magistrate judge found that Chief Judge Tunheim's statement that he would “take a further look at [the emails] and resolve [the work-product issue] later” referred to a different motion in limine that addressed a different set of emails. For these reasons, the magistrate judge denied Feinwachs's motion for further consideration of sealing.

         B. Analysis

         As the magistrate judge correctly observed, the purpose of the law-of-the-case doctrine is to prevent relitigating a settled issue in a case. Maxfield v. Cintas Corp., No. 2, 487 F.3d 1132, 1134-35 (8th Cir. 2007). This doctrine provides that, “when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages of the same case.” Id. (internal quotation marks omitted). The law-of-the-case doctrine protects the settled expectations of the parties, ensures the uniformity of decisions, and promotes judicial efficiency. Id. at 1135. As the magistrate judge correctly observed, Chief Judge Tunheim determined that the emails on MHA's computer network were “not private” and that the attorney-client privilege has been waived as to those emails. Nothing in the record suggests that Chief Judge Tunheim reserved any aspect of his decision that the attorney-client privilege had been waived. To the extent that Feinwachs continues to assert the protection of the attorney-client privilege to support sealing emails that were found on MHA's computer network, his argument is foreclosed by the law-of-the-case doctrine.

         Feinwachs also argues, however, that the work-product doctrine renders the 2010 emails confidential and, therefore, subject to continued sealing in this case. The law-of-the-case doctrine is inapplicable, he argues, to the extent that he is asserting protection under the work-product doctrine as to these two emails because Chief Judge Tunheim reserved ruling on that issue. The magistrate judge disregarded this argument as “irrelevant, ” finding that Chief Judge Tunheim's decision to delay ruling on the work-product issue was “unrelated to the emails” that are the subject of Feinwachs's motion for further consideration of sealing. This finding is erroneous.

         At the November 7, 2018 hearing, Feinwachs argued that protection under the work-product doctrine has not been waived with respect to the 2010 emails even if the attorney-client privilege has been waived with respect to those emails. In response to this argument, Chief Judge Tunheim stated that he would “take a further look” at the disputed emails to consider whether any are “work product, as opposed to privilege[d], ” and that the Court would “resolve it later.” The record does not support the magistrate judge's finding that this statement pertained to a different group of emails. Rather, this statement pertained to the 2010 emails.

         Feinwachs subsequently filed a supplemental motion in limine re-asserting the work-product doctrine as to the 2010 emails. That motion had not been decided by the Court at the time of the magistrate judge's April 5, 2019 Order. Fainwachs's supplemental motion in limine is addressed below in Part II.E. of this Order.^[1] As such, the law-of-the-case doctrine did not foreclose Feinwachs's work-product arguments in support of his motion for further consideration of sealing.

         For these reasons, the magistrate judge clearly erred in the April 5, 2019 Order by denying Feinwachs's motion for further consideration of sealing based on the law-of-the-case doctrine. The April 5, 2019 Order is reversed to the extent that it ordered any document unsealed on that basis. As addressed in Part II.E. below, the Court now concludes that the 2010 emails were created in anticipation of litigation and are opinion work product. Accordingly, the sealing issue is remanded to the magistrate judge for further proceedings consistent with this Order.

         II. Plaintiff's Motions in Limine

         Feinwachs moves to exclude evidence of (1) the dismissal of his underlying qui tam claims, (2) his advocacy of gun ownership rights, (3) the terms of his contingency fee arrangement with his attorney, (4) the past lobbying efforts by Feinwachs and his attorney relating to the MFCA, (5) emails between Feinwachs and his attorney that were discovered on MHA's computer network, and (6) certain aspects of Feinwachs's alcohol treatment records. The Court addresses each motion in turn.

         A. Dismissal of Qui Tam Claims

         Feinwachs moves to exclude evidence of, or reference to, the fact that he initially asserted, and later voluntarily dismissed, qui tam claims in this case. He argues that such evidence is irrelevant and its probative value, if any, is substantially outweighed by the danger of unfair prejudice and confusing the jury. See Fed. R. Evid. 402, 403. Defendants counter that this evidence is relevant to liability and damages and that excluding this information would confuse the jury.

         Feinwachs initially commenced this lawsuit as a qui tam action alleging FCA claims against several health maintenance organizations (HMOs). After the United States declined to intervene in March 2015, the Court granted Feinwachs's motion to voluntarily dismiss, without prejudice, Feinwachs's FCA claims against the HMO defendants. At the November 7, 2018 hearing, Chief Judge Tunheim granted Feinwachs's related motion to exclude evidence of or reference to the decision of the United States not to intervene in the qui tam action, concluding that such evidence is irrelevant and potentially prejudicial. But Chief Judge Tunheim denied Feinwachs's related motion to exclude evidence that no court or agency has ever found that the HMOs engaged in fraud, concluding that such evidence is relevant to the objective reasonableness of Feinwachs's belief that fraud was being committed. Chief Judge Tunheim deferred ruling on whether to exclude evidence that Feinwachs initially asserted, and later voluntarily dismissed, his qui tam claims in this case.

         The FCA prohibits retaliation against an employee “because of lawful acts done by the employee . . . in furtherance of an [FCA] action . . . or other efforts to stop 1 or more [FCA] violations.” 31 U.S.C. § 3730(h)(1). To establish retaliation under the FCA, a “plaintiff must prove that (1) the plaintiff was engaged in conduct protected by the [FCA]; (2) the plaintiff's employer knew that the plaintiff engaged in the protected activity; (3) the employer retaliated against the plaintiff; and (4) the retaliation was motivated solely by the plaintiff's protected activity.” Elkharwily v. Mayo Holding Co., 823 F.3d 462, 470 (8th Cir. 2016) (internal quotation marks omitted). As “[t]he text of the MFCA retaliation provision . . . is substantially similar to the federal corollary, ” United States ex rel. Scharber v. Golden Gate Nat'l Senior Care LLC, 135 F.Supp.3d 944, 968-69 (D. Minn. 2015), courts analyze MFCA claims under the same legal standard as analogous FCA claims, Olson v. Fairview Health Servs., 831 F.3d 1063, 1069 n.6 (8th Cir. 2016).

         “The protected activity element of a retaliation claim does not require the plaintiff to have filed an FCA lawsuit or to have developed a winning claim at the time of the alleged retaliation.” Schuhardt v. Wash. Univ., 390 F.3d 563, 567 (8th Cir. 2004). The FCA's anti-retaliation provision “protects an employee's conduct even if the target of an investigation or action to be filed was innocent.” Graham Cty. Soil & Water Conservation Dist. v. United States ex rel. Wilson, 545 U.S. 409, 416 (2005); accord Townsend v. Bayer Corp., 774 F.3d 446, 459-60 (8th Cir. 2014).

         Neither filing a qui tam claim, nor prevailing on the merits of a qui tam claim, is a prerequisite to proving the elements of Feinwachs's retaliation claims. As such, evidence that Feinwachs filed such claims after his termination and later dismissed those claims has no relevance to any claim or defense to liability with respect to Feinwachs's retaliation claims. Defendants contend that excluding this evidence “will create negative and inaccurate inferences that fraud occurred and MHA was associated with it.” But the Court previously ruled that Defendants may present evidence that no court or agency has ever found that the HMOs engaged in fraud. Such evidence, if presented, would alleviate the inferences about which Defendants are concerned.

         According to Defendants, evidence that Feinwachs filed, and later dismissed, his qui tam claims is relevant to damages because it demonstrates that Feinwachs “was extraordinarily busy dedicating time to his ultimately unsuccessful repeat lawsuits and did very little to mitigate his damages by finding a comparable new job.” Although this evidence may have some marginal relevance to damages, the minimal probative value of this evidence is substantially outweighed by the dangers of unfair prejudice and confusing or misleading the jury. See Fed. R. Evid. 403. Admitting this evidence risks creating improper inferences with respect to liability even though, as addressed above, this evidence is irrelevant to liability. Moreover, this evidence is ...