Court Opinion

ID: 9948594
Source: CourtListenerOpinion
Date Created: 2024-03-07 17:09:18.379605+00
Date Added: 2024-06-11T14:25:45.930601
License: Public Domain

140 Nev., Advance Opinion |
IN THE SUPREME COURT OF THE STATE OF NEVADA

SUNRISE HOSPITAL AND MEDICAL No. 85844
CENTER, LLC; AND CORD OLSEN,
RN,

2 F L E 5

THE EIGHTH JUDICIAL DISTRICT

COURT OF THE STATE OF NEVADA, MAR 07 20
IN AND FOR THE COUNTY OF euigffete: «, adowp
CLARK; AND THE HONORABLE CLERY Of SHARE URT
MARIA A. GALL, DISTRICT JUDGE, OY fener DEPUTY CLERK
Respondents,

and

TIFFINY GRACE, INDIVIDUALLY
AND AS LEGAL GUARDIAN AND
MOTHER OF E.G.,

Real Party in Interest.

Original petition for a writ of prohibition challenging a district
court order compelling discovery.

Petition granted.

Hall Prangle & Schoonveld, LLC, and Nathan R. Reinmiller and Michael E.
Prangle, Las Vegas,
for Petitioners.

Prince Law Group and Dennis M. Prince, Kevin T. Strong, and Andrew R.
Brown, Las Vegas,
for Real Party in Interest.

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BEFORE THE SUPREME COURT, HERNDON, LEE, and
PARRAGUIRRE, JJ.

OPINION
By the Court, HERNDON, J.:

In this opinion, we address the contours of the privilege created
by the federal Patient Safety and Quality Improvement Act of 2005
(PSQIA), 42 U.S.C. §§ 299b-21-299b-26, that applies to information that
qualifies as patient safety work product. We determine that under the
PSQIA, identifiable patient safety work product is privileged from discovery

in civil proceedings and the privilege cannot be waived.

FACTS AND PROCEDURAL HISTORY

E.G. was born prematurely at Sunrise Hospital on January 8,
2018. Sunrise’s medical team placed him in the Neonatal Intensive Care
Unit due to complications from the premature birth. On February 27, 2018,
his assigned nurse, Cord Olsen, changed his fluid lines. Shortly thereafter,
E.G. decompensated, his oxygen levels and heart rate plummeted, and his
skin splotched with discolorations. He entered into cardiac arrest, and
medical staff rushed to save him. E.G. ultimately suffered a hypoxic event,
leading to permanent developmental damage.

Sunrise has a Patient Safety Committee, which investigated
E.G.’s cardiac arrest with the goal of improving future healthcare outcomes.
Dr. Jeffrey Murawsky, the Chief Medical Officer of Sunrise, chaired the
committee. His deposition testimony revealed that Sunrise used a patient
safety evaluation system as its internal process for collecting, managing,
and analyzing the information that it reported to the patient safety

organization. The Patient Safety Committee reviewed that information,

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collected additional data, and maintained that data within its internal
evaluation system.

Real party in interest Tiffiny Grace, E.G.’s legal guardian, sued
Sunrise Hospital and Nurse Olsen for professional negligence. During
discovery, she attempted to depose Dr. Murawsky. She sought to discover
what information the Patient Safety Committee examined in its
investigation. Sunrise objected to some of the questions Grace posed on the
basis of privileges under both Nevada law and the PSQIA. Grace halted the
deposition, citing the need for answers to those questions. She then moved
to compel further deposition testimony from Dr. Murawsky.

On October 24, 2022, the district court issued an order rejecting
Sunrise’s PSQIA arguments after concluding that any privilege was waived
by disclosure and directed the parties to further brief whether Sunrise
waived its privilege under Nevada law. Following that briefing, on
December 6, 2022, the district court issued its second order, granting
Grace’s motion to compel. The district court determined that Sunrise had
permitted Dr. Murawsky to testify about certain privileged topics, Sunrise
had permitted other personnel to testify about those topics, and Sunrise had
waived any privileges by permitting such testimony. The district court
again rejected Sunrise’s PSQIA arguments as unpersuasive. Sunrise filed
the instant writ petition challenging both orders.

In November 2023, after this matter was fully briefed and set
for oral argument, the district court sua sponte filed a third order relating
to the motion to compel. Neither party was alerted to the court’s intentions,
and, as a result, they were not invited to further brief any issues or

otherwise participate. However, the district court addressed only the

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proportionality of the requested discovery and refused a protective order; it

again rejected Sunrise’s PSQIA arguments in conclusory fashion.

DISCUSSION

This original proceeding asks us to determine whether the
district court exceeded its jurisdiction by compelling testimony concerning
allegedly privileged information. Because harm from disclosure of that
information cannot be remedied in the normal course of an appeal and this
petition concerns a novel issue of law, we consider the petition. In doing so,
we first consider whether the PSQIA patient safety work product privilege
can be waived. We then consider the district court’s decision in the context
of whether the information that Grace seeks to discover constitutes
privileged patient safety work product.

Writ relief

Writ relief is appropriate to prevent the disclosure of privileged
information. “When the district court acts without or in excess of its
jurisdiction, a writ of prohibition may issue to curb the extrajudicial act.”
Toll v. Wilson, 1385 Nev. 4380, 432, 453 P.3d 1215, 1217 (2019) Gnternal
quotation marks omitted). “Therefore, even though discovery issues are
traditionally subject to the district court’s discretion and unreviewable by a
writ petition, this court will intervene when the district court issues an
order requiring disclosure of privileged information.” Id.

Furthermore, writ relief is appropriate when “an important
issue of law needs clarification and this court’s invocation of its original
jurisdiction serves public policy.” Canarelli v. Highth Jud. Dist. Ct., 136
Nev. 247, 250-51, 464 P.3d 114, 119 (2020) Gnternal quotation marks
omitted). “One such instance 1s when a writ petition offers this court a

unique opportunity to define the precise parameters of a privilege conferred

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by a statute that this court has never interpreted.” Diaz vu. Kighth Jud.
Dist. Ct., 116 Nev. 88, 93, 993 P.2d 50, 54 (2000) (cleaned up).

The district court order below compels the disclosure of
allegedly privileged information, so we elect to entertain this petition for a
writ of prohibition. Our intervention will clarify the extent of the privilege
afforded by the PSQIA, a federal act we have yet to address. It will also
serve public policy by helping medical providers and attorneys understand
the extent to which patient safety work product is privileged.

Standard of review

We review discovery matters for an abuse of discretion. Club
Vista Fin. Serus., LLC v. Eighth Jud. Dist. Ct., 128 Nev, 224, 228, 276 P.3d
246, 249 (2012). But we review conclusions of law, including the meaning
and scope of statutes, de novo. Dewey v. Redev. Agency of Reno, 119 Nev.
87, 93-94, 64 P.38d 1070, 1075 (2003).

Under the PSQIA, patient safety work product is privileged, and that
privilege cannot be waived

The PSQIA provides that “patient safety work product shall be
privileged and shall not be...subject to discovery... [or] admitted as
evidence in any Federal, State, or local governmental civil proceeding.” 42
U.S.C. §§ 299b-22(a)(2), (4). Patient safety work product comes in two
categories: identifiable and nonidentifiable. Identifiable patient safety
work product includes the identities of the providers, patients, or reporters
involved. 42 U.S.C. § 299b-21(2). Nonidentifiable patient safety work
product includes all other patient safety work product (i.e., that without
identifying information). 42 U.S.C. § 299b-21(3). Nonidentifiable patient
safety work product may be voluntarily disclosed, and when it is, it is
exempted from privilege. 42 U.S.C. § 299b-22(c)(3). Our opinion concerns

the privilege as it pertains to identifiable patient safety work product.

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There are only a few exceptions to PSQIJA privilege for
identifiable patient safety work product: in certain criminal proceedings, in
civil actions brought by a good-faith reporter, or when every medical
provider identified in the work product authorizes disclosure. 42 U.S.C.
§ 299b-22(c)(1)(A)-(C). None of those exceptions apply here.

Nonetheless, the district court found that Sunrise could waive
the PSQIA’s grant of privilege over patient safety work product. It erred in
doing so by abusing the negative-implication canon to create a necessary
condition for privilege where none exists in the PSQIA’s implementing
regulation. !

The regulation, 42 C.F.R. § 3.208, states that patient safety
work product disclosed in accordance with 42 C.F.R. § 3.204(b)(1) or
disclosed impermissibly shall remain privileged. But the district court
interpreted this regulation to mean that patient safety work product
disclosed permisstibly shall not remain privileged. This maneuver was both
logically invalid and incorrect as a matter of law.

The plain language of the regulation describes when patient
safety work product shall continue to remain privileged. 42 C.F.R. § 3.208.
It does not purport to describe when patient safety work product shall be

excepted from privilege, as the implementing regulations cover those

1Better known in its Latin form as “expressio unius est exclusio
alterius,” the negative-implication canon holds that the expression of one
thing implies the exclusion of others. Antonin Scalia & Bryan Garner,
Reading Law: The Interpretation of Legal Texts 107 (2012). “Virtually all
the authorities who discuss the negative-implication canon emphasize that
it must be applied with great caution, since its application depends so much
on context.” Jd. The applicability of the canon is limited to when the
subjects specified in the rule can reasonably be thought to be an expression
of all that share in the quality described. Id.

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exceptions in a different section. See 42 C.F.R. § 3.204(b) (titled
“[e]xceptions to privilege” and describing when privilege shall not apply to
the enumerated disclosures). The negative-implication canon should not be
applied to 42 C.F.R. § 3.208 because it creates an exception to privilege far
broader than the exceptions to privilege explicitly carved out elsewhere in
the PSQIA and its implementing regulations.

The district court’s interpretation also fails to consider that the
PSQIA’s implementing regulations already contemplate when voluntary
disclosure could defeat privilege, specifically, for nonidentifiable patient
safety work product. 42 C.F.R. § 3.204(b)(4). Reading further exceptions to
privilege into 42 C.F.R. § 3.208 would render the explicitly enumerated
exceptions in 42 C.F.R. § 3.204(b) superfluous. That violates one of our long-
held tenets of interpretation, which is to consider a statute’s “provisions as
a whole so as to read them in a way that [will] not render words or phrases
superfluous or make a provision nugatory.” S. Nev. Homebuilders Ass’n v.
Clark County, 121 Nev. 446, 449, 117 P.3d 171, 173 (2005) (Gnternal
quotation marks omitted).”

We reject the district court’s interpretation and determine that
PSQIA privilege is absolute. Federal courts tasked with determining
whether PSQIA privilege extends over alleged patient safety work product

ask two questions: (1) whether those materials were “created for the

2Because the plain language of the regulation suffices to support our
conclusion, we need not reach other means of deciphering the drafters’
intent. However, we caution district courts to be wary of finding exceptions
to a rule via the negative-implication canon when such exceptions are
explicit elsewhere in the regulatory scheme. It would be quite strange to
make some exceptions explicit under the section titled “Exceptions to
privilege” (42 C.F.R. § 3.204(b)) but others implicit under a section titled
“Continued protection of patient safety work product” (42 C.F.R. § 3.208(b)).

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purpose of reporting to a patient safety organization”? and (2) whether they
were “so reported.” Nelms v. Wellpath, LLC, No. 21-10917, 2023 WL
2733379, at *2 (E.D. Mich. Mar. 31, 2023) (quoting Penman v. Correct Care
Sols., LLC, No. 5:18-CV-00058-TBR-LLK, 2020 WL 4253214, at *3 (W.D.
Ky. July 24, 2020), and citing Tinal v. Norton Healthcare, Inc., No. 3:11-CV-
596-S, 2014 WL 12581760, at *11 (W.D. Ky. July 15, 2014)). We adopt the
same test here in Nevada. The only factors bearing on whether identifiable
patient safety work product may be privileged under the PSQIA are
(1) whether the materials were created for the purpose of reporting to a
patient safety organization and (2) whether they were so reported. If they
are so privileged, then courts must consider whether one of the exceptions
made explicit by 42 C.F.R. § 3.204(b) applies.

Because the PSQIA does not contemplate waiver of the
privilege over identifiable patient safety work product, we conclude that
such a privilege cannot be waived. Our interpretation accords with the
PSQIA’s stated goals. Congress enacted the PSQIA to “strike[] the
appropriate balance between plaintiff rights and creat[e] a new culture in
the health care industry that provides incentives to identify and learn from
errors.” S. Rep. No. 108-196, at 4 (2003). The PSQIA grants privileges to
information produced in pursuit of that goal, like patient safety work
product. 42 U.S.C. § 299b-22. The statutory scheme does not permit a
finding that a party has voluntarily relinquished PSQIA privilege

3The PSQIA defines “patient safety organization[s]” and states that
they must obtain certification from the Secretary of Health and Human
Services. 42 U.S.C. §§ 299b-21(4), 299b-24. It is undisputed that Sunrise,
at all times relevant to this suit, maintained an active agreement with a
certified patient safety organization, the HCA Patient Safety Organization,
LLC.

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pertaining to identifiable patient safety work product; that party might
inadvertently disclose patient safety work product or disclose it in
accordance with specific exceptions, but the privilege continues to exist. 42
U.S.C. § 299b-22(a), (c); 42 C.F.R. § 3.208.

Finally, we note that the privilege flows in both directions.
Nothing in the PSQIA precludes a plaintiff from asserting the same
privilege when it suits them. If a medical provider were to attempt to
introduce evidence including identifiable patient safety work product, then
the plaintiff could object on the same grounds.

We grant the petition for a writ of prohibition

The district court further erred by failing to determine whether
the testimony that Grace sought to compel constituted identifiable or
nonidentifiable patient safety work product. The two are treated differently
under the PSQIA. 42 U.S.C. §§ 299b-21, 299b-22. This court is not
particularly suited to fact-finding in the first instance. Ryan’s Express
Transp. Servs., Inc. v. Amador Stage Lines, Inc., 128 Nev. 289, 299, 279 P.3d
166, 172 (2012). We thus decline to decide whether the information
constitutes identifiable or nonidentifiable patient safety work product. We
grant the petition for a writ of prohibition to vitiate the district court’s
orders to the extent they found PSQIA protections waived and compelled
the testimony of potentially privileged information. We further instruct the
district court to, upon reconsideration of the issue, first determine whether
the testimony that Grace seeks to compel constitutes identifiable or

nonidentifiable patient safety work product.‘

4We have considered the parties’ remaining arguments about
preemption and state law privilege. Because we find no conflict between
the PSQIA and Nevada’s state law privilege provided by NRS 49.265, we

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CONCLUSION

The district court erred by concluding that Sunrise waived any
privilege over identifiable patient safety work product under the PSQIA.
Because that privilege cannot be waived, the district court must first
determine whether the testimony that Grace seeks to compel concerns
identifiable or nonidentifiable patient safety work product, and then rule on
the motion to compel accordingly. Thus, we grant the petition for a writ of
prohibition. The clerk of this court shall issue a writ of prohibition directing
the district court to vacate its orders compelling the testimony of Dr.

Murawsky and to reconsider Grace’s motion to compel in light of this

Herndo

opinion.

We concur:

, Jd.
Lee Pe

™ SE he ea peti J.
Parraguirre

need not apply any preemption doctrine. Nonetheless, to the extent that
PSQIA privilege is broader than the privilege afforded under Nevada law,
the PSQIA applies. See 42 U.S.C. § 299b-22(a) (“Notwithstanding any other
provision of Federal, State, or local law...patient safety work product
shall be privileged... .”); Nanopierce Techs., Inc. v. Depository Tr. &
Clearing Corp., 123 Nev. 362, 370, 168 P.3d 73, 79 (2007) (“[W]hen a conflict
exists between state and federal law, valid federal law overrides, i.e.,
preempts, an otherwise valid state law.”).

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