Court Opinion

ID: 4208666
Source: CourtListenerOpinion
Date Created: 2017-10-03 17:17:28.701623+00
Date Added: 2024-06-11T14:14:08.909780
License: Public Domain

J-A17043-17

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

TALATHA MCLAURIN, INDIVIDUALLY                   IN THE SUPERIOR COURT OF
AND AS ADMINISTRATRIX OF THE                           PENNSYLVANIA
ESTATE OF YVONNE G. FIELDS,
DECEASED

                            Appellee

                       v.

ARIA HEALTH, ARIA HEALTH SYSTEM,
ARIA HEALTH PHYSICIAN SERVICES,
ARIA HEALTH FOUNDATION, GREGORY
C. BOLTON, SR., M.D., QUEST
DIAGNOSTICS CLINICAL
LABORATORIES, INC., QUEST
DIAGNOSTICS INCORPORATED, AND
ROBERT M. LUCAS, M.D., D.D.S., PH.D.,

                            Appellants               No. 2582 EDA 2016

                       Appeal from the Order June 29, 2016
              in the Court of Common Pleas of Philadelphia County
                 Civil Division at No.: #03934, April Term, 2015

BEFORE: GANTMAN, P.J., RANSOM, J., and PLATT, J.*

MEMORANDUM BY PLATT, J.:                          FILED OCTOBER 03, 2017

        Appellants, Quest Diagnostics, Inc. and Quest Diagnostics Clinical

Laboratories, Inc., appeal from the order of June 29, 2016, which granted in

part and denied in part its request for a protective order. We vacate in part

and remand.

____________________________________________

*
    Retired Senior Judge assigned to the Superior Court.
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       We take the underlying facts and procedural history in this matter

from the trial court’s February 16, 2017 opinion and our independent review

of the certified record.

            This professional negligence and medical malpractice
      action was brought following the death of [sixty-three] year old
      Yvonne G. Fields who died of complications related to
      endometrial cancer of the uterus.        The decedents’ estate,
      represented by her daughter, Talatha McLaurin[, Appellee],
      alleges that [Appellants and the co-defendants] failed to properly
      evaluate or timely diagnose cancer.       The complaint named
      various Quest Diagnostics entities and Robert M. Lucas, M.D.[,] a
      pathologist who worked for Quest Diagnostics. It also named
      the gynecologist, Gregory C. Bolton, M.D., who treated the
      decedent.

            With specific reference to [Appellants], [Appellee] claims
      that a slide with an endometrial tissue biopsy specimen was
      misread.   The specimen was reportedly collected by Doctor
      Bolton and submitted to Quest Diagnostics Clinical Laboratories
      in Horsham, where it was received, accessioned, interpreted by
      Doctor Lucas, and reported by [Appellants] as atrophic
      endometrium.      [Appellee] avers that it should have been
      reported as insufficient tissue.

(Trial Court Opinion, 2/16/17, at 2-3).

      On May 1, 2015, Appellee filed the instant medical malpractice action.

During discovery, a dispute arose between Appellee and Appellants

regarding Appellee’s request that Appellants produce their internal policies

and procedures pertaining to the interpretation of pathology specimens.

Appellants unsuccessfully attempted to negotiate an agreement with

Appellee in the form of a stipulated protective order, which stated that

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Appellee and her counsel would not disseminate or use the documents

outside of the litigation.

       On March 2, 2016, Appellee filed a motion to compel production of the

documents.      At a hearing on March 16, 2016, Appellants advised the trial

court that they wished to present the documents to the court for review and

to argue for a protective order. The trial court advised Appellants to address

the issue via a separate motion for a protective order, which Appellants filed

on March 21, 2016.

       On June 8, 2016, the trial court held a hearing on the motion for a

protective order.      By order of June 29, 2016, the trial court granted the

motion in part and denied it in part.1           On July 6, 2016, Appellants filed a

motion for reconsideration, which the trial court denied on September 12,

2016. The instant, timely appeal followed. On January 17, 2017, the trial

court ordered Appellants to file a concise statement of errors complained of

on appeal. See Pa.R.A.P. 1925(b). Appellants filed a timely Rule 1925(b)

statement on February 3, 2017. See id. On February 16, 2017, the trial

court filed an opinion. See Pa.R.A.P. 1925(a).

       On appeal, Appellants raise the following question for our review:

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1
  The trial court granted the motion as to documents from the personnel file
of Dr. Lucas and with respect to various contracts between Appellants and
some of the co-defendants in this matter.

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            Should [Appellants’] request to produce [their] secret,
      proprietary and competitively sensitive documents, which are
      based on and derived from years of data and analysis unknown
      to the public, only under the terms of a standard [p]rotective
      [o]rder which would limit [Appellee’s] ability to disseminate the
      confidential and proprietary documents, be granted?

(Appellants’ Brief, at 3).

      Prior to addressing the merits of Appellants’ contention, this Court is

obligated to “first ascertain whether the [order appealed from] is properly

appealable, because the question of appealability implicates the jurisdiction

of this [C]ourt.”   Commonwealth v. Borrero, 692 A.2d 158, 159 (Pa.

Super. 1997) (citations omitted). “The general rule is that, unless otherwise

permitted by statute, only appeals from final orders are subject to appellate

review.” Commonwealth v. Sartin, 708 A.2d 121, 122 (Pa. Super. 1998)

(citations omitted).   In relevant part, the Pennsylvania Rules of Appellate

Procedure define a “final order” as any order that “disposes of all claims and

of all parties.” Pa.R.A.P. 341(b)(1).

      In the instant matter, the trial court’s June 29, 2016 order is not final,

as it concerned a discovery matter. See Jones v. Faust, 852 A.2d 1201,

1203 (Pa. Super. 2004) (“in general, discovery orders are not final, and are

therefore unappealable”).     Thus, the challenged order constitutes a non-

final, interlocutory order.

      Interlocutory orders are appealable in certain circumstances. Our

Supreme Court explained:

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      in addition to an appeal from final orders of the Court of
      Common Pleas, our rules provide the Superior Court with
      jurisdiction in the following situations: interlocutory appeals that
      may be taken as of right, Pa.R.A.P. 311; interlocutory appeals
      that may be taken by permission, Pa.R.A.P. [312]; appeals that
      may be taken from a collateral order, Pa.R.A.P. 313; and appeals
      that may be taken from certain distribution orders by the
      Orphans’ Court Division, Pa.R.A.P. 342.

Commonwealth v. Garcia, 43 A.3d 470, 478 n.7 (Pa. 2012) (quotation

marks and citation omitted).

      The order at issue is not appealable as of right (per Pa.R.A.P. 311) and

Appellants did not ask for or receive permission to appeal the order (per

Pa.R.A.P. 312). Thus, the question before this Court is whether the order in

this case (or any aspect of the order) is appealable under the collateral order

doctrine. See Pa.R.A.P. 313.

      Pennsylvania Rule of Appellate Procedure 313 defines a collateral order

as one that:    “1) is separable from and collateral to the main cause of

action; 2) involves a right too important to be denied review; and 3)

presents a question that, if review is postponed until final judgment in the

case, the claim will be irreparably lost.” In re Bridgeport Fire Litigation,

51 A.3d 224, 230 n.8 (Pa. Super. 2012) (citation omitted); see also

Pa.R.A.P. 313(b).   An order is “separable from and collateral to the main

cause of action” if the order “is entirely distinct from the underlying issue in

the case and if it can be resolved without an analysis of the merits of the

underlying dispute.” K.C. v. L.A., 128 A.3d 774, 778 (Pa. 2015) (internal

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quotation marks and citation omitted).         Further, with respect to the

“separability” prong of the test, our Supreme Court explained that,

“[a]lthough [the Supreme Court will] tolerate a degree of interrelatedness

between merits issues and the question sought to be raised in the

interlocutory appeal, the claim must nevertheless be conceptually distinct

from the merits of plaintiff's claim.”   Commonwealth v. Blystone, 119

A.3d 306, 312 (Pa. 2015) (quotation marks and citations omitted).

      Our Supreme Court has also emphasized that:

      the collateral order doctrine is a specialized, practical [exception
      to] the general rule that only final orders are appealable as of
      right. Thus, Rule 313 must be interpreted narrowly, and the
      requirements for an appealable collateral order remain stringent
      in order to prevent undue corrosion of the final order rule. To
      that end, each prong of the collateral order doctrine must be
      clearly present before an order may be considered collateral.

Melvin v. Doe, 836 A.2d 42, 46-47 (Pa. 2003) (citations omitted).

      In keeping with the narrow interpretation of the collateral order

doctrine, our Supreme Court has held that “the collateral order rule’s three-

pronged test must be applied independently to each distinct legal issue over

which an appellate court is asked to assert jurisdiction pursuant to Rule

313.” Rae v. Pa. Funeral Dir.'s Ass'n, 977 A.2d 1121, 1130 (Pa. 2009).

Therefore, even if the collateral order test “is satisfied with respect to one

[appellate] issue,” the assertion of jurisdiction does not necessarily mean

that we have “jurisdiction to consider every issue within the ambit of the

appealed order[.]” Id. at 1123.
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      Here, Appellants claim that the trial court erred in denying their

request for a protective order to preclude any dissemination of their

standard operating procedures.            (See Appellant’s Brief, at 11).    We can

address    this    claim   without   analyzing     Appellee’s   underlying   medical

malpractice claim. See Crum v. Bridgestone/Firestone North American

Tire, LLC, 907 A.2d 578, 583 (Pa. Super. 2006). Thus, Appellants have met

the first prong.

      With respect to the second prong, the Pennsylvania Supreme Court

has explained that this prong is satisfied “if the interests that would

potentially go unprotected without immediate appellate review of that issue

are significant relative to the efficiency interests sought to be advanced by

adherence to the final judgment rule.”           Ben v. Schwartz, 729 A.2d 547,

552 (Pa. 1999) (citation omitted). Further, “it is not sufficient that the issue

be important to the particular parties. Rather it must involve rights deeply

rooted in public policy going beyond the particular litigation at hand.”

Melvin, supra at 47 (citation omitted).

      Here, Appellants assert that the documents in question contain trade

secrets and failure to protect them will result in the exposure of those

secrets,    causing        “irreparable      competitive   harm[.]”     (Appellants’

Brief, at 11).     We have stated, “[t]he right to confidentiality in matters

involving proprietary and trade secrets is rooted in public policy and impacts

on individuals and entities other than those involved in the current
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litigation.” Crum, supra at 584 (citation omitted). Further, Pennsylvania

Rule of Civil Procedure 4012(a)(9), which controls the discovery of trade

secrets, permits the trial court to order “that a trade secret or other

confidential research, development or commercial information shall not be

disclosed or be disclosed only in a designated way.” Pa.R.C.P. 4012(a)(9).

Thus, we find that the trade-secret protection is entrenched in public policy

beyond the litigation at hand, and is important enough to justify immediate

appellate review. See Crum, supra at 584.

      Lastly, we look at the irreparable loss prong. Again, Appellants argue

that the failure of the trial court to enter the protective order will risk

exposure of their trade secrets.        (See Appellants’ Brief, at 11).    Our

Supreme Court has stated, “[t]here is no effective means of reviewing after

a final judgment an order requiring the production of putatively protected

material.” Ben, supra at 552 (citation omitted). Clearly, if disclosed, the

confidentiality of the information in question is lost. Accordingly, Appellants

have met the third prong.

      For the reasons discussed above, we hold that the June 29, 2016 order

denying in part the motion of Appellants for a protective order is collateral

and appealable of right under Pa.R.A.P. 313. Therefore, we will now address

the merits of Appellants’ contention.

      With respect to our standard of review, we have held:

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         It is the responsibility of the trial court to oversee discovery
         between the parties and therefore it is within that court’s
         discretion to determine the appropriate measure necessary to
         insure adequate and prompt discovery of matters allowed by the
         Rules of Civil Procedure. With regard to requests for protective
         orders . . . [,]

         [t]here are no hard-and-fast rules as to how a motion for a
         protective order is to be determined by the court. Whether to
         grant or deny the motion, and what kind or kinds of protective
         orders to issue are matters that lie within the sound judicial
         discretion of the court, and the court’s determination as to these
         matters will not be disturbed unless that discretion has been
         abused.

Hutchison v. Luddy, 606 A.2d 905, 908 (Pa. Super. 1992), appeal

discontinued, 611 A.2d 712 (Pa. 1992) (internal citations and quotations

omitted). “An abuse of discretion occurs when a trial court, in reaching its

conclusions, overrides or misapplies the law, or exercises judgment which is

manifestly unreasonable, or the result of partiality, prejudice, bias, or ill

will.”    Commonwealth v. Brown, 839 A.2d 433, 435 (Pa. Super. 2003)

(citation omitted).

         As discussed above, Appellants sought entry of a protective order

under Pennsylvania Rule of Civil Procedure 4012(a)(9), to protect against

the dissemination of any documents produced during discovery. Again, we

note that Rule 4012(a)(9) states:

         (a) Upon motion by a party or by the person from whom
         discovery or deposition is sought, and for good cause shown, the
         court may make any order which justice requires to protect a
         party or person from unreasonable annoyance, embarrassment,
         oppression, burden or expense, including one or more of the
         following:
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                                   * *      *
            (9) that a trade secret or other confidential research,
            development or commercial information shall not be
            disclosed or be disclosed only in a designated way.

Pa.R.C.P. 4012(a)(9).

      In the instant matter, in their motion, Appellants claim that a

protective order was necessary because the documents included trade

secrets, namely:

      developmental research [which contains] detailed information as
      to [Appellants’] techniques and methodologies, so if the
      [s]tandard [o]perating [p]rocedures are not protected, a
      competitor could readily compare its procedures with those of
      [Appellants] and identify those areas needing particular attention
      to gain improved performance, eliminating its own expenditures
      associated with the evaluation and development of such policies
      and procedures. . . .

(Appellants’ Motion for Entry of a Protective Order, 3/21/16, at 6). The trial

court denied Appellants’ motion.     Firstly, in its decision, the trial court

appeared to misunderstand the nature of the Appellants’ request, noting that

Appellants, “failed to cite to a single medical malpractice action in which a

judge sitting in Pennsylvania entered a protective order that protected a

defendant’s policies and procedures from production during discovery.”

(Trial Ct. Op., at 4) (emphasis added).      The court further found that “a

critical factor” was Appellants’ failure to offer redacted documents or any

papers in response to Appellee’s discovery request. (Id.).

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     However, on review, we are constrained to conclude that the trial court

is mistaken. Here, Appellants were not seeking to prevent the discovery of

the documents.     Rather, in their motion, Appellants specifically stated,

“[Appellants are] not refusing to produce the requested documents.

[Appellants are] asking only that [their] legitimate business interest in

protecting [their] [s]tandard [o]perating [p]rocedures . . . from broad

dissemination requires entry of a protective order.” (Appellants’ Motion for

Entry of a Protective Order, 3/21/16, at 4-5) (emphasis added). At both the

hearing on Appellee’s motion to compel and the hearing on the motion for a

protective order, Appellants reiterated that they had no objection to

producing the documents. (See N.T. Motion to Compel Hearing, 3/16/16, at

11, 20-21; N.T. Motion for a Protective Order Hearing, 6/08/16, at 10-13,

15). They also stated they had no objection to its use in the litigation and

its dissemination to the parties and any expert witnesses, but only wished to

protect it from dissemination to the public and their competitors. (See N.T.

Motion to Compel Hearing, at 11, 20-21; see N.T. Motion for a Protective

Order Hearing, at 10-13, 15). Therefore, it is evident that Appellants sought

only to protect the dissemination of the documents to the broader public, not

to prevent Appellee’s discovery of the documents and their use in the instant

matter. Thus, the trial court’s analysis of whether or not the documents are

discoverable is not germane to the issue of whether a protective order

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should issue, or whether the circumstances justify such a measure to protect

against dissemination of confidential material.

       We note that, in its opinion, the trial court did hold that the material in

question was not a trade secret.          (See Trial Ct. Op., at 4).   However, its

brief discussion of the issue appears to be inextricably entwined with its

mistaken belief that Appellants sought protection from production during

discovery, rather than protection from disclosure to the public. (See id.).

Further, in making its ruling, while invoking the correct standard of review,

the trial court did not discuss any of the evidence provided by Appellants

and did not discuss, in specific detail, how Appellants failed to meet that

standard.2 (See id. at 3-4).

       Our Court has defined a trade secret as, “any formula, pattern, device

or compilation of information which is used in one’s business, and which

gives [it] an opportunity to obtain an advantage over competitors who do

not know or use it.” Crum, supra at 585 (citation omitted). We have held

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2
  We are sympathetic to the difficulties faced by the trial court in this matter.
Appellants’ failure to submit the documents in question for review by the
trial court and their refusal to provide specific information regarding the
information contained within them, clearly hampered the proceedings below
and made review by this Court exceedingly complicated. However, we
believe, as discussed infra, that the affidavits submitted by Appellants’
employees provided sufficient information to meet the standard for finding
that the documents constituted a trade secret.

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that the following factors should be considered in determining whether

information is a trade secret:

      1) the extent to which the information is known outside of [the]
      business; 2) the extent to which it is known by employees and
      others involved in [the] business; 3) the extent of measures
      taken by [it] to guard the secrecy of the information; 4) the
      value of the information to [it] and to [its] competitors; 5) the
      amount of effort or money expended by [it] in developing the
      information; and 6) the ease or difficulty with which the
      information could be properly acquired or duplicated by others.
      The crucial indicia for determining whether certain information
      constitutes a trade secret are substantial secrecy and
      competitive value to the owner.

Id. (citations and quotation marks omitted).

      Here, Appellants submitted affidavits from Leslie Kennedy, the quality

assurance manager for Quest Diagnostic Clinical Laboratories, Inc., and from

Dr. Harvey Ronald Kennedy, M.D., the senior medical director for national

medical quality at Quest Diagnostics. (See Affidavit in Support of Protective

Order, 3/17/16, at unnumbered page 1; Second Affidavit in Support of

Protective Order, 6/17/16, at unnumbered page 1).        We have reviewed

these documents with the above-stated factors in minds. Appellants do not

make the documents in question available to the public and they are only

disseminated to a limited number of Appellants’ employees. (See Affidavit

in Support of Protective Order, at unnumbered page 3; see Second Affidavit

in Support of Protective Order, at unnumbered page 3). In order to guard

the secrecy of the information contained within the documents, employees

must sign confidentiality agreements and any breach of that confidentiality
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subjects the employee to disciplinary action up to and including discharge

and potential legal liability. (See Affidavit in Support of Protective Order, at

unnumbered pages 3-4). Appellants contend that the information has great

value to its competitors because the standard operating procedures are

based on years of compilation of nationwide research, data and statistics,

leading to a higher quality of testing than their competitors. (See Affidavit

in Support of Protective Order, at unnumbered pages 4-5; see Second

Affidavit in Support of Protective Order, at unnumbered pages 2-3). Further,

Appellants contend that they invested substantial monies in gathering this

data, which Appellants review annually, and writing new or revised

procedures expends many hours of labor.           (See Affidavit in Support of

Protective Order, at unnumbered pages 4-5).              For these reasons, this

information would be of substantial value to Appellants’ competitors.

      Thus, in sum, the evidence provided by Appellants shows that the

standard   operating   procedures    are      based    on   statistics,    data,   and

information, which indicates their value to them and that the information

could disadvantage them if disseminated to the public. Clearly, Appellants

have taken many measures to safeguard the standard operating procedures

and closely held the information contained therein. Given this, we hold that

the trial court erred in determining that Appellants had not shown that the

documents in question were a trade secret.            See Dibble v.       Penn State

Geisinger Clinic, Inc., 806 A.2d 866, 871-72 (Pa. Super. 2002), appeal
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denied, 820 A.2d 705 (Pa. 2003) (holding that trial court erred in denying

protective order and finding documents did not contain trade secrets for one

hundred eight documents in medical malpractice case including HMO’s

procedures for its physicians, where HMO guarded confidentiality of

documents, expended funds developing information, and dissemination could

create competitive disadvantage).

      Therefore, for the reasons discussed above, we vacate those portions

of the June 29, 2016 order denying the motion of Appellants for a protective

order.   The case is remanded to the trial court for entry of an order of

confidentiality to prevent dissemination of the information at issue.

      Order vacated in part. Case remanded. Jurisdiction relinquished.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 10/3/2017

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