*1 HON. STEPHEN G. LARSON (Ret.) slarson@larsonllp.com Larson LLP 555 S. Flower Street Suite 4400 Los Angeles, CA 90071 Tel: (213) 436-4888 Fax: (213) 623-2000 SPECIAL MASTER

Plaintiffs TML Recovery, LLC, MMR Services, LLC, Southern California Recovery Centers Oceanside, LLC, Addiction Health Alliance, LLC, DR Recovery Encinitas, LLC, Southern California Addiction Center, Inc., 12 South LLC, Woman's Recovery Center, LLC, and Pacific Palms Recovery, LLC (collectively, “Plaintiffs”) move for an order compelling defendants Cigna Corporation, Cigna Health and Life Insurance Company, Connecticut General Life Insurance Company, Cigna Behavioral Health, Inc., Cigna Behavioral Health of California, Inc., Cigna Health Management, Inc., Cigna Healthcare of California, Inc., (collectively, “Cigna”) and Viant, Inc. and MultPlan, Inc. (collectively, “MultiPlan”) (and together with Cigna, “Defendants”) to produce documents in the above-captioned action that Defendants produced in a companion action pending in the Northern District of California, RJ v. Cigna et al., Case No. 5:20-CV-02255-EJD (N.D. Cal.) (hereinafter “RJ”). Alternatively, Plaintiffs request relief from the Protective Order entered in the RJ case so that Plaintiffs can utilize documents produced in the RJ case in this action.

Having reviewed the briefing submitted by the Parties, and after hearing the Parties' arguments on May 19, 2023, the Special Master recommends that the Court DENY Plaintiffs' Motion to Compel.

I. PROCEDURAL BACKGROUND

On May 17, 2023, Plaintiffs emailed the Special Master claiming Defendants' production in this matter is incomplete. Specifically, Plaintiffs allege that Defendants produced highly relevant documents in the RJ case that Defendants did not produce in this action, despite the documents being responsive to Plaintiffs' discovery requests. See Exhibit A (Plaintiffs' May 17, 2023, email to the Special Master). The same day, the Special Master requested that the Parties submit letter briefs by May 18, 2023, setting forth the Parties' respective positions on the issue. See Exhibit A (Special Master's May 17, 2023, email to the Parties). The Special Master also noticed a hearing for May 19, 2023, regarding Plaintiffs' Motion to Compel. See id.

On May 18, 2023, the parties each submitted letter briefs addressing the merits of Plaintiffs' Motion to Compel. See Exhibit B (Plaintiffs' letter brief); Exhibit C (Cigna's letter brief); Exhibit D (MultiPlan's letter brief).

On May 19, 2023, at 2:30 p.m. (PST), the Special Master held a hearing on Plaintiffs' Motion to Compel.

II. FACTUAL BACKGROUND

A. Discovery – Document Production Deadline

The fact discovery cut-off in this action was June 24, 2022. See ECF No. 115, at 2. By June 24, 2022, all written discovery should have been completed, and by July 29, 2022, the Parties were required to substantially complete their respective document productions. See ECF No. 115, at 2.

B. The RJ Documents

In the RJ action, Defendants produced documents pursuant to the Protective Order in that action. According to Plaintiffs, the documents include: *2 

During the hearing before the Special Master, Defendants represented that that the RJ production occurred in October 2022. Plaintiffs, however, represented that some documents were produced by Defendants in the RJ action in March 2023. Regardless, the RJ productions occurred over 2 months ago, and likely, 7 months ago.

Plaintiffs contend that the above-listed documents are responsive to Plaintiffs' requests for production in this case and the Special Master's Report & Recommendation No. 8 (ECF No. 122) (adopted by the Court's Order, ECF No. 131) because the documents relate to (1) “Cigna's utilization targets and efforts to reduce expenses on OON SUD claims”; (2) “fees for services, coverage and benefit determinations, the percentage of the services covered, and the reasoning behind these determinations”; and (3) “amounts charged by Cigna and payments it received from the plans ....” See Exhibit B, at 1-2.

C. Plaintiffs' Delay in Seeking Defendants' Production of the RJ Documents in this Case

During the hearing before the Special Master, Plaintiffs asserted that they would like to use the RJ documents to counter arguments made by Cigna in its Motion for Summary Judgment—scheduled to be heard by the Court on June 5, 2023. When the Special Master questioned why Plaintiffs' Motion to Compel was not brough sooner, i.e., soon after the documents were produced in the RJ action, Plaintiffs' only explanation for delay was that it was “engaged”—that is, it was too busy to bring the Motion to Compel prior to May 17, 2023.

III. SPECIAL MASTER'S RECOMMENDATION

The Special Master recommends denying Plaintiffs' Motion to Compel. Plaintiffs' Motion to Compel is untimely. Indeed, it has been filed (i) 10 months after the document production deadline in this matter, (ii) at least 2 months after the relevant RJ documents were produced (and likely 7 months after the relevant RJ documents were produced), and (iii) on the eve of the hearing on Defendants' motions for summary judgment. Because “[t]his Court has a strong interest in adhering to scheduled dates,” (ECF No. 8, at 2), the Motion to Compel is patently untimely. See Draper v. Coombs, 792 F.2d 915, 924 (9th Cir. 1989) (denying motion to compel discovery where the motion to compel was filed “long after the deadline that the district court set for the end of discovery”); Green Aire for Air Conditioning W.L.L. v. Salem, No. 1:18-cv-00873-LJO-SKO, 2020 WL 58279, at *2 (E.D. Cal. Jan. 6, 2020) (“[M]otions to compel filed after the close of discovery generally deemed untimely.”); Stevenson v. Holland, No. 1:16-cv-01831-AWI-JLT, 2019 WL 4747644, at *6 (E.D. Cal. Sept. 30, 2019) (“[T]he untimeliness of a motion to compel ‘is sufficient ground, standing alone, to deny a discovery motion’ ”) (citation omitted); Cottrell v. Wright, No. 2:09-cv-0824 JAM CKD P., 2012 EL 3535838, at *2 (E.D. Cal. Aug. 15, 2012) (denying plaintiff's motion to compel as untimely because it was filed over three months after the discovery deadline and over three months after plaintiff received defendants' responses).

*3 Moreover, Plaintiffs have failed to show any “excusable neglect,” or “good cause” to extend and/or reopen document discovery 10 months after the deadline lapsed. See Fed. R. Civ. Proc. 6(b)(1)(B) (“When an act may or must be done within a specific time, the court may, for good cause, extend the time: (B) on motion made after the time has expired if the party failed to act because of excusable neglect.”); Fed. R. Civ. Proc. 16(b)(4) (Court may modify a scheduling order “only for good cause”); Green Aire for Air Conditioning W.L.L., 2020 WL 58279, at *3 (“Rule 16(b)'s good cause inquiry focuses primarily on the movant's diligence.”) (citing Coleman v. Quaker Oats Co., 232 F.3d 1271, 1295 (9th Cir. 2000)). Here, Plaintiffs were not diligent; Plaintiffs conceded this point during the May 19, 2023 hearing before the Special Master. Indeed, the only reason Plaintiffs offered for why this Motion to Compel was not brought earlier is that Plaintiffs were “engaged” in other motion practice. This is not “good cause.” See e.g., A.S.M.V. v. Cnty. of Los Angeles, No. 2:19-cv-06158-SB-PLA, 2021 WL 816479, at *2 (C.D. Cal. 2021) (a “busy schedule” and “seriously ill secretary” do not constitute good cause).

Because Plaintiffs' Motion to Compel is untimely, the Special Master need not address the balance of Plaintiffs' arguments on the merits. The Special Master does note, however, that Plaintiffs' request for relief from the RJ Protective Order is beyond the authority of the Special Master, whose jurisdiction is limited to resolving discovery issues in this matter alone.

IV. CONCLUSION

For the foregoing reasons, the Special Master recommends that the Court DENY Plaintiffs' Motion to Compel. The Motion to Compel is untimely, and Plaintiffs have not set forth any good cause to justify their delay. Moreover, because Plaintiffs' Motion to Compel has been brough on the eve of the summary judgment hearing, the Special Master finds that ordering the production of documents at this late date poses “the danger of prejudice to the non-movant.” See A.S.M.V., 2021 WL 816479, at *2.

IT IS SO RECOMMENDED.

Stephen G. Larson Special Master

IT IS SO ORDERED.

From: Stephen G. Larson

Sent: Wednesday, May 17, 2023 2:30 PM

To: Olin, Claire

Cc: Andrew J. Bedigian; Caplan, Matt; Antia, Mazda; Robertson, Jamie D; Song, Sharon; Scott, Dylan K; Errol J. King, Jr. - Phelps Dunbar LLP (errol.king@phelps.com); Katherine Cicardo Mannino - Phelps Dunbar LLP (katie.mannino@phelps.com); Craig Caesar (1272); Taylor J. Crousillac (2219); Brittany Holt Alexander (2279); Eisenbrey, Damon D.; Benson, Landen; Kelly, Tom E.; Reed, Amy; Golsby, Kiersten; Collins, Richard T.

Subject: RE: TML Recovery, LLC v. Cigna Corporation et al (C.D. Cal. 8:20-cv-00269-DOC-JDE) Lead Case in Consolidated Cigna OON SUD Provider Litigation

I have received your respective emails. Please submit, by close of business tomorrow, Thursday, May 18, a letter brief not to exceed four pages (single-spaced) setting forth your respective positions. I am available for a hearing on this matter at either 9:30 am PT or 2:30 pm PT on Friday, May 19. I request the parties to meet and confer and advise me which time slot work best by the close of business today.

Thanks, Stephen

Stephen G. Larson

Partner

P 213.436.4864 C 909.285.5632

F 213.623.2000

slarson@larsonllp.com

555 South Flower Street, Suite 4400

Los Angeles, CA 90071

larsonllp.com

LARSON

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From: Olin, Claire <colin@cooley.com>

Sent: Wednesday, May 17, 2023 2:19 PM

*4 To: Stephen G. Larson <slarson@larsonllp.com>

Cc: Andrew J. Bedigian <abedigian@larsonllp.com>; Caplan, Matt <mcaplan@cooley.com>; Antia, Mazda <mantia@cooley.com>; Robertson, Jamie D <jdrobertson@cooley.com>; Song, Sharon <ssong@cooley.com>; Scott, Dylan K <dscott@cooley.com>; Errol J. King, Jr. - Phelps Dunbar LLP (errol.king@phelps.com) <errol.king@phelps.com>; Katherine Cicardo Mannino - Phelps Dunbar LLP (katie.mannino@phelps.com) <katie.mannino@phelps.com>; Craig Caesar (1272) <Craig.Caesar@phelps.com>; Taylor J. Crousillac (2219) <Taylor.Crousillac@phelps.com>; Brittany Holt Alexander (2279) <Brittany.Alexander@phelps.com>; Eisenbrey, Damon D. <Damon.Eisenbrey@AGG.com>; Benson, Landen <Landen.Benson@AGG.com>; Kelly, Tom E. <Tom.Kelly@AGG.com>; Reed, Amy <Amy.Reed@AGG.com>; Golsby, Kiersten <Kiersten.Golsby@AGG.com>; Collins, Richard T. <Rich.Collins@AGG.com>

Subject: RE: TML Recovery, LLC v. Cigna Corporation et al (C.D. Cal. 8:20-cv-00269-DOC-JDE) Lead Case in Consolidated Cigna OON SUD Provider Litigation

Special Master Larson,

Cigna also requests an expedited call to discuss Mr. Collins and Mr. Eisenbrey's (“AGG”) violation of the parties' Stipulated Protective Order. The parties met and conferred on this issue on May 15, 2023 and were unable to reach a resolution. Given the potential impact on the parties' Motions for Summary Judgment, currently being briefed before Judge Carter – reply briefs are due on May 22 and the hearing is set for June 5 – we ask that all hearings and the briefing schedule before Your Honor be expedited. Below is a brief summary of Cigna's position.

AGG attached 56 documents, which Cigna designated and produced as “ATTORNEYS' EYES ONLY” (“AEO”), to declarations submitted by employees of each plaintiff in support of their Opposition to Cigna's Motion for Summary Judgment. Cigna designated these materials as AEO because they contain highly sensitive financial and commercial information and trade secrets. Plaintiffs' access to this information is improper. The parties' Stipulated Protective Order only allows AEO information to be disclosed to the Court, in-house counsel, experts, court reporters, and mediators or settlement officers. Protective Order at 7.3 (attached). The declarants – plaintiffs' Executive Administrators, Chief Operating Officer, and Chief Executive Officers – are not among those permitted to view AEO information. The declarations are proof positive that AGG violated the Protective Order by disclosing AEO information to plaintiffs.

The SPO requires AGG to: (1) use best efforts to retrieve all unauthorized copies of the protected material, (2) inform the person or persons to whom unauthorized disclosures were made of the terms of this Order, and (3) request such person or persons to execute Exhibit A to the Protective Order.

In addition to these remedial efforts, Cigna seeks the following sanctions: (1) an order striking each declaration that impermissibly quotes from and/or attaches Cigna AEO information; (2) an order prohibiting Plaintiffs from using Cigna's AEO documents or information derived from Cigna's AEO documents in any manner, including business agreements, contract negotiations, or other business-related matters with or related to Cigna; and (3) any other relief that may be necessary.

*5 Best,

Claire A. Olin

Cooley LLP

10265 Science Center Drive

San Diego, CA 92121-1117

+1 858 550 6102 office

+1 858 550 6420 fax

colin@cooley.com Pronouns: she, her, hers

www.cooley.com

Cooley is committed to racial justice

From: Collins, Richard T. <Rich.Collins@AGG.com>

Sent: Wednesday, May 17, 2023 11:37 AM

To: Stephen G. Larson <slarson@larsonllp.com>

Cc: Andrew J. Bedigian <abedigian@larsonllp.com>; Caplan, Matt <mcaplan@cooley.com>; Antia, Mazda <mantia@cooley.com>; Olin, Claire <colin@cooley.com>; Robertson, Jamie <jdrobertson@cooley.com>; Song, Sharon <ssong@cooley.com>; Scott, Dylan K <dscott@cooley.com>; Errol J. King, Jr. - Phelps Dunbar LLP (errol.king@phelps.com) <errol.king@phelps.com>; Katherine Cicardo Mannino - Phelps Dunbar LLP (katie.mannino@phelps.com) <katie.mannino@phelps.com>; Craig Caesar (1272) <Craig.Caesar@phelps.com>; Taylor J. Crousillac (2219) <Taylor.Crousillac@phelps.com>; Brittany Holt Alexander (2279) <Brittany.Alexander@phelps.com>; Eisenbrey, Damon D. <Damon.Eisenbrey@AGG.com>; Benson, Landen <Landen.Benson@AGG.com>; Kelly, Tom E. <Tom.Kelly@AGG.com>; Reed, Amy <Amy.Reed@AGG.com>; Golsby, Kiersten <Kiersten.Golsby@AGG.com>

Subject: TML Recovery, LLC v. Cigna Corporation et al (C.D. Cal. 8:20-cv-00269-DOC-JDE) Lead Case in Consolidated Cigna OON SUD Provider Litigation

[External]

Dear Hon. Stephen Larson,

Pursuant to your standing order, Plaintiffs in the TML v. Cigna consolidated litigation request that your honor oversee a meet and confer with Defendants Cigna and MultiPlan concerning a time-sensitive discovery dispute. Beginning in April, Plaintiffs invited Defendants to meet and confer on a limited number of discovery issues that arose during depositions, but Defendants have rejected Plaintiffs' proposals to resolve this dispute.

The dispute specifically centers around documents that Cigna and MultiPlan have not produced in this action that Plaintiffs know exist. Plaintiffs' counsel, through its involvement in the related matter of RJ v. Cigna, N.D. Cal., Case. No. 5:20-CV-02255-EJD, has become aware of a number of documents produced in the RJ action that should have also been produced in this action. The RJ action involves the same defendants—Cigna and MultiPlan--and the same counsel for MultiPlan, and involves the same issue of Cigna's under-reimbursement of OON SUD treatment claims using MultiPlan's databases, during the same time period. Defendants refuse to produce these RJ documents and contend that Plaintiffs may not use these documents in this action because they were produced under a protective order in RJ.

Defendants' refusal to comply with their discovery obligations gives Plaintiffs cause for concern that there may be additional, relevant and responsive documents that Defendants withheld from production. Plaintiffs contend that the documents produced in RJ are unquestionably responsive to the discovery requests directed to Defendants in this action, and that Defendants should produce those same documents in this action. Alternatively, Plaintiffs propose that the protective order in RJ be amended to allow Plaintiffs to use in this action any of the documents produced under the RJ protective order. There would be no prejudice and little or no burden if Defendants either re-produce what has already been produced to Plaintiffs, or stipulate to an amended protective order. Conversely, Plaintiffs would be significantly prejudiced if they are prohibited from using evidence they know exists simply because Defendants designated the most damaging evidence as confidential.

*6 The parties have briefed cross-motions for summary judgment that are scheduled to be heard on 6/5/23. Trial is scheduled for 7/31/23. Because of the procedural posture of this case, Plaintiffs request this meet and confer take place this week (if at all possible) or early next week, depending upon your honor's availability.

Rich Collins

Partner

Arnall Golden Gregory LLP

2100 Pennsylvania Avenue, NW

Suite 350S

Washington, DC 20037

p: 202.677.4917

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2100 Pennsylvania Avenue NW

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Washington, D.C. 20037

Direct Phone: 202.677.4917

Email: rich.collins@agg.com

May 18, 2023

CONFIDENTIAL VIA EMAIL

Hon. Stephen G. Larson

555 South Flower Street, Ste 4000

Los Angeles, CA 90071

slarson@larsonllp.com

(213) 436-4864

Re: TML Recovery, LLC v. Cigna Corporation et al (C.D. Cal. 8:20-cv-00269-DOC-JDE) Meet and Confer Efforts

Dear Mr. Larson,

1. Plaintiffs' Request for Relief

Plaintiffs seek an order compelling Cigna's further production of documents or relief from a protective order entered in a related action wherein Cigna produced documents that should have also been produced in this action. The Special Master found in Report and Recommendations (“R&R”) No. 8 (ECF 122) (adopted by the Court's Order, ECF 131) that “because Plaintiffs have ‘proffered sufficient facts plausibly suggesting the presence of a financial or other conflict of interest’ relating to Cigna's benefits decisions,” Cigna must produce (1) document regarding “Cigna's utilization targets and efforts to reduce expenses on OON SUD claims;” (2) “Communications and documents between Cigna and MultiPlan relating to fees for services, coverage and benefit determinations, the percentage of the services covered, and the reasoning behind these determinations;” and (3) “documents showing amounts charged by Cigna and payments it received from the plans ....”[1]

Cigna produced documents in response to the Court's Order and designated those documents as “Attorney Eyes Only” (“AEO”) pursuant to the stipulated protective order (“SPO,” ECF 19). These documents confirm Cigna's financial conflict of interest in adjudicating the out of network (“OON”) substance use disorder (“SUD”) claims at issue, and Cigna's plan to pend, deny, and under-reimburse OON SUD claims in order to increase its own profits. Cigna's internal email chain in April 2015 proves that Cigna was reimbursing OON SUD claims at full billed charges because it knew there is no Medicare rate for SUD services. In July 2015, Cigna groused about the amounts spent on OON SUD claims due to the lack of a Medicare rate and developed a plan to find a Medicare rate to use, and to aggressively increase claim reviews and reduce the total number of claims by, among other things, placing SUD providers on a “hit list.” By August 2015, Cigna was already patting itself on the back for the “nearly ... 90% reduction in paid claims compared to just 2 weeks ago.” In November 2015, Cigna touted that it had reduced the amount paid on OON intensive outpatient claims from $13.6 million in June to $3 million in August, a 78% reduction in just two months of aggressively denying and under-reimbursing OON SUD claims. That drastic reduction also meant a significant increase in Cigna's cost containment fees that are calculated at 27-29% of the difference between the billed charge and the allowed amount.

*7 While these documents demonstrate Cigna's conflict of interest and justify the prior Order, the production is incomplete and fails to include documents Cigna and MultiPlan produced in the related action of RJ v. Cigna, N.D. Cal., Case. No. 5:20-CV-02255-EJD, a putative class action involving the same issue of Cigna's under-reimbursement of OON SUD treatment claims using MultiPlan's databases, during the same time period. Some examples of these documents include:

Defendants refuse to produce these and other RJ documents and contend that Plaintiffs may not use them in this action because they were produced under a protective order in RJ. These documents deserve no protection, and the RJ protective order should not be used improperly to shield Defendants' most damaging evidence. There would be no prejudice and little or no burden if Defendants either re-produce what has already been produced in the RJ case or stipulate to an amended protective order in RJ to allow for the use of the RJ documents in this action. Conversely, Plaintiffs would be significantly prejudiced if they are prohibited from using evidence they know exists simply because Defendants designated the most damaging evidence as confidential.

2. Defendants' Request for Relief

Cigna contends counsel violated the SPO by allowing Plaintiffs to review documents Cigna unscrupulously labeled “AEO.” These documents do not warrant protection by the SPO and, even if they did, Cigna waived any confidentiality objection when it questioned Plaintiffs about these documents during depositions. Cigna falsely asserts in its email to the Special Master that there are “56 documents” at issue. There are only 14 documents at issue, though the same 6 of those 14 documents were attached to Plaintiffs' 8 Declarations (sample declaration attached). The remaining 8 of those 14 documents are pdf extracts from Cigna's claims data production in response to the Court's prior Order.

Contrary to Cigna's argument, counsel met and conferred via Zoom on May 15, 2023. Plaintiffs advised Cigna that the documents are not protected and requested that Cigna re-designate the documents accordingly. Cigna's counsel confirmed by email that same day: “We are reviewing our designations, as requested, and conferring with our client.” Furthermore, Cigna is not arguing that the documents could not be filed with the court,[2] but rather, that the documents cannot be filed via the Plaintiff declarations. But Plaintiffs had every right to receive the AEO documents and rely on them for their declarations since “Receiving Party” is defined by the SPO to include Plaintiffs and their officers. SPO ¶¶ 2.13, 2.18 and 7.3. In any event, the documents were filed under seal and will remain out of public view, and Plaintiffs complied with the SPO procedure for addressing the disclosure of AEO materials. SPO ¶ 10.

*8 As demonstrated by the attached sample declaration, the documents at issue do not qualify for protection; they simply contain Defendants' dirty laundry showing their financial conflict of interest.[3] The quoted portions of internal Cigna email communications relate to Cigna's administration of the claims and plan terms and never should have been designated AEO. SPO, ¶ 5.1. Moreover, because Cigna is acting as an ERISA fiduciary, by law such materials are not protected. See Stephan v. Unum Life Ins. Co. of Am., 697 F.3d 917, 932-33 (9th Cir., 2012).

Even if the Special Master finds that Plaintiffs should not have reviewed these AEO documents, Cigna waived its objections when it introduced AEO documents at Plaintiffs' depositions and examined them about their review.[4] Williams v. City of Long Beach, 219CV05929ODWAFMX, 2021 WL 6497197, at *2 (C.D. Cal. Nov. 23, 2021), quoting Littlejohn v. BIC Corp., 851 F.2d 673, 680 (3d Cir. 1988; Banga v. Kohl's Dep't Stores, Inc., C 13-00275 SBA, 2013 WL 6734116, at *2 (N.D. Cal. Dec. 20, 2013) (quoting In re Dual–Deck Video Cassette Recorder Antitrust Litig., 10 F.3d 693, 695 (9th Cir. 1993).

Furthermore, the Court retains discretion to modify a protective order if good cause is shown. The SPO permits “any person designated by the Court in the interest of justice, upon such terms as the Court may deem proper” to receive AEO documents. SPO, ¶ 7.3(e). Plaintiffs as parties to this action and in the interests of justice should be able to review the evidence, especially because they are not competitors to Defendants. See Brown Bag Software v. Symantec Corp., 960 F.2d 1465, 1470 (9th Cir. 1992) (Acceptability of inadvertent disclosure of confidential information is determined by balancing the injury to the party whose information is being disclosed against the need for access.).

Plaintiffs ask that the Special Master recommend an order compelling Cigna's further production of documents or relief from the RJ protective order so that documents produced by Defendants in that action may be used in this action. Plaintiffs also request that the Special Master find they did not violate the SPO by reviewing the 14 AEO documents relied upon and referenced in their declarations.

Sincerely,

ARNALL GOLDEN GREGORY LLP

Richard T, Collins

Claire Olin

T: +1 858 550 6102

colin@cooley.com

Via Email

May 18, 2023

Special Master Stephen Larson

Larson LLP

555 South Flower Street, Suite 4400

Los Angeles, CA 90071

slarson@larsonllp.com

Re: TML Recovery, LLC v. Cigna Corp., C.D. Cal. Case No. 8:20-cv-0269-DOC-JDE

Special Master Larson:

This letter sets forth Cigna's position regarding the two discovery disputes submitted to Your Honor on Wednesday, May 17, 2023: (1) Cigna's Motion for Sanctions related to violation of the Parties' Protective Order and (2) Plaintiffs' Motion to Compel documents produced in the unrelated RJ litigation.[1]

As detailed below, there is no question that plaintiffs' counsel, Richard Collins, Damon Eisenbrey, and their firm, Arnell Golden Gregory LLP (“AGG”), violated the Protective Order by sharing numerous documents designated by Cigna in this litigation as “ATTORNEYS' EYES ONLY” (“AEO”) with plaintiffs who then used that information to support purported disputed issues of material fact at summary judgment. Plaintiffs' violation was willful and prejudices Cigna. Cigna seeks the remedies set forth below.

*9 In addition, plaintiffs' Motion to Compel is without any basis. First, Plaintiffs' motion is untimely because document discovery in this case has been closed for 11 months. Second, Plaintiffs refuse to identify the documents which were produced in RJ (a separate, unrelated case in which Cigna has different counsel) and the discovery requests in this case to which they would otherwise be responsive, so Cigna has been unable to fully evaluate plaintiffs' claims. It is unreasonable to expect an exact overlap in collected or produced documents between the cases.

Plaintiffs' employees quoted from and attached numerous of Cigna's AEO documents to declarations filed in support of their Opposition to Cigna's Motion for Summary Judgment (“Opposition”), and AGG has since admitted that it disclosed other AEO documents and information to its clients while preparing for depositions—though it has yet to provide a complete accounting of those documents. There is no question that AGG violated the Protective Order and that such violation has already prejudiced Cigna.

Cigna properly designated the documents as AEO. The Protective Order allows Cigna to designate documents as AEO which contain trade secret information, financial data, and highly sensitive financial, commercial, and marketing information relating to the parties business activities, “including without limitation, contracts and fee schedules with participating providers and analyses reflecting average rates of reimbursement for procedures, and information or analyses reflecting methods used to determine Maximum Reimbursable Charges or Usual and Customary Charges.” Protective Order at 2.4.

Cigna properly designated the disclosed documents as AEO. The disclosed AEO materials include Cigna's AEO cost containment reports, which list the amounts billed for services by code and the amounts paid by Cigna to each provider, as well as confidential financial information of Cigna, the Plans and MultiPlan, including highly sensitive competitive information regarding the rates paid by each to the other. Other disclosed AEO documents discuss Cigna's market prevalence, include financial overviews that specify actual and estimated pricing and claims expenses, and outline Cigna's strategic and long-term financial planning.[2] Each of these categories of documents are entitled to protection.

AGG violated the Protective Order by disclosing Cigna's AEO information to plaintiffs. Plaintiffs' declarants and 30(b)(6) witnesses are not among those permitted to view Cigna's AEO information. Compare Protective Order at 7.2. and 7.3. Yet, plaintiffs' Executive Administrators, Chief Operating Officer, and Chief Executive Officer filed declarations in support of their Opposition which attach and quote directly from Cigna's AEO documents. Plaintiffs used this information as the evidentiary basis to raise purported disputed issues of material fact and to avoid summary judgment on their claims. For example, plaintiffs relied on the material to argue that the rates paid by Cigna were not paid in accordance with the plan terms and that the agreements plaintiffs negotiated with MultiPlan are invalid. See, e.g., Opp. at 8-9, 14 (AEO documents allegedly reflect that Cigna “began scheming on ways to avoid paying what it owes”), 20-22 (AEO docs purportedly reflect that Cigna used inapplicable Medicare rates and defective databases).

*10 AGG has also since admitted that plaintiffs' 30(b)(6) witnesses reviewed AEO spreadsheets, among other materials, which reflect the method Cigna used to determine Maximum Reimbursable Charges for each provider. These witnesses used this information as the basis for their testimony that Cigna's reimbursement amounts did not comply with plan terms. Plaintiffs then used these employees' testimony as additional evidence in support of their Opposition and to manufacture disputed issues of material fact.

To the extent plaintiffs now argue that Cigna's AEO designations are improper they were required to follow the procedures set forth in Section 6 of the Protective Order to challenge the designations before sending Cigna's AEO documents to their clients. See Protective Order at 6.5. (“Unless the Designating Party has waived or withdrawn the confidentiality designation, all parties shall continue to afford the material in question the level of protection to which it is entitled under the Producing Party's designation until the Court rules on the challenge.”) Moreover, any challenges to Cigna's designations only now and in the face of a motion for sanctions, would be for an improper purpose. See Protective Order at 6.5. (“Frivolous challenges, and those made for an improper purpose ... may expose the Challenging Party to sanctions.”).

AGG's willful conduct must be remedied. Federal Rule of Civil Procedure 37 grants this Court the authority to impose sanctions for violating protective orders. United States v. Nat'l Med. Enters., Inc., 792 F.2d 906, 910-11 (9th Cir. 1986). This Court can impose a wide range of sanctions, so long as they are just and specifically relate to the particular violation at issue. See id.; see also Fed. R. Civ. P. 37(b)(2)(C). Remedies may be imposed regardless of the reason for a party's failure to comply, but willful and egregious violations may warrant more serious sanctions. Societe Internationale Pour Participations Industrielles et Commerciales, S.A. v. Rogers, 357 U.S. 197, 208 (1958).

AGG willfully violated the parties' Protective Order by disclosing to their clients Cigna's AEO information which was labeled as AEO. Moreover, AGG lodged the materials under seal because they contained “documents that Cigna and MultiPlan ... produced as ‘Confidential’ or ‘Attorney's Eyes Only’ pursuant to the Protective Order that which Defendants maintain, if publicly disclosed, may harm their (or their clients') competitive standing.” See Dkt. 238 at 2. The scope of AGG's violation is particularly egregious – numerous documents and an entire volume of Cigna's production – but these are just the violations known to Cigna. Cigna has repeatedly requested a list of the AEO documents shared and the names of each person who received AEO information, but AGG is either unwilling or unable to provide this information, despite previously agreeing to do so. Based on AGG's representations, Cigna believes that the actual scope of disclosure is far greater.

Cigna was harmed by AGG's violations and will suffer prejudice if sanctions are not imposed. Though Cigna is not required to establish harm for sanctions to be imposed, it has already suffered significant prejudice from plaintiffs' use of the AEO material. AGG willfully violated the terms of the Protective Order so that plaintiffs could bolster their arguments in opposition to summary judgment with improperly disclosed AEO information. If the portions of plaintiffs' declarations that quote from and attach Cigna's AEO documents and all references thereto are not stricken from the record, plaintiffs will be allowed to benefit from AGG's violation to Cigna's detriment.

*11 AGG provides no justification for the disclosures—indeed, there is none—instead arguing that Cigna waived each and every AEO designation because one of plaintiffs' 30(b)(6) witnesses, Nathaniel Izzo, testified that he had reviewed an AEO Cigna production and Cigna introduced one of its own AEO documents as a deposition exhibit. First, it was unclear from Mr. Izzo's testimony that he had reviewed full, unredacted versions of the AEO documents. And even if he had explicitly stated that he reviewed Cigna's AEO information, that deposition occurred mere weeks ago. It is reasonable for Cigna to address the improper disclosure now. Second, Cigna's disclosure of its own AEO document and a short delay in addressing an unclear admission of disclosure by a witness during his deposition does not waive all AEO designations made by Cigna in this case. The scope of any such waiver, if any, is limited to the specific exhibit.

Section 10 of the Protective Order requires AGG to use best efforts to retrieve all unauthorized copies of the AEO documents, inform the persons to whom unauthorized disclosures were made of all the terms of the Order, and request that they execute Exhibit A to the Protective Order. But these are not the only remedies authorized by the Protective Order. See Protective Order at 14 (“Any violation of this Order may be punished by any and all appropriate measures including, without limitation, contempt proceedings and/or monetary sanctions.”). AGG's willful and egregious conduct requires additional remedies.

Cigna requests that Your Honor issue an order: (1) striking each declaration that impermissibly quotes from and/or attaches Cigna AEO information; and (2) prohibiting plaintiffs from using Cigna's AEO documents or information derived therefrom in any manner, including business agreements, contract negotiations, or other business-related matters with or related to Cigna. These remedies are just, reasonably related to the violation, and of the type that have been ordered by district courts following violations of discovery orders. See, e.g., AECOM Energy, 2022 U.S. Dist. LEXIS 35146, at *23-24 (C.D. Cal. Feb. 25, 2022) (issuing attorney fees, evidentiary, and terminating sanctions following willful violation of discovery order); see also Avago Techs., Inc. v. Iptronics, Inc., 2015 U.S. Dist. LEXIS 75948, at *19-22 (N.D. Cal. June 11, 2015) (requiring expert witness who violated SPO to return all designated information, promise not to use it, and excluding his testimony); see also Life Techs. Corp. v. Biosearch Techs., Inc., 2012 U.S. Dist. LEXIS 63974, at *24-40 (N.D. Cal. May 7, 2012) (barring counsel from accessing AEO documents and excluding portions of expert testimony following violation of protective order). Failure to issue such an order would prejudice Cigna and allow plaintiffs to unfairly benefit from AGG's improper disclosures.

In addition, to compensate Cigna for its expenses in responding to AGG's misconduct, and to secure its compliance with further Court orders, AGG should be made to reimburse Cigna its reasonable costs, fees, and expenses caused by AGG's actions (including the prosecution of this Motion).[3]

Plaintiffs' request for documents produced by Cigna in the RJ litigation must be denied. Cigna complied with its discovery obligations, including orders from the Court on Plaintiffs' prior motion to compel. In any event, these issues are moot because discovery in this case has been closed for 11 months. To the extent plaintiffs believed certain documents from an unrelated litigation should have been produced, they were required to seek such discovery nearly a year ago. The deadline for this Motion has long since passed. Plaintiffs' Motion must be denied as untimely. See, e.g., Cottrell v. Wright, 2012 U.S. Dist. LEXIS 115197, at *2 (E.D. Cal. Aug. 15, 2012) (denying motion to compel as untimely when filed more than three months after the discovery deadline and more than three months after party received responses to discovery requests).

*12 If the Court does consider Plaintiffs' untimely motion, it still must be denied. Through communications with Plaintiffs (which Cigna can provide if helpful),[4] Cigna understands that Plaintiffs believe unspecified documents exist which were responsive to certain RFPs – largely the same RFPs that were subject to Plaintiffs' prior motion to compel which this Court ruled on eight months ago. (See ECF No. 122 [Report & Recommendation No. 8].). However, in Plaintiffs' reply brief on that motion to compel (ECF No. 121), Plaintiffs expressly disclaimed that they were seeking “related communications” to the very RFPs at issue here. Plaintiffs also expressly agreed to accept reports in lieu of certain hard copy documents. Cigna produced responsive documents pursuant to the Court's order, which was based, in part, on Plaintiffs' representations in their briefing. Nothing more is required.

Finally, Plaintiffs are not entitled to every document that was produced in RJ. This action is not related to, coordinated, or consolidated with the RJ litigation. Though it involves similar defendants, it is an entirely different case with different counsel (including different in-house counsel at Cigna) and different causes of action. Search terms, custodians, review teams, discovery requests and responses, discovery orders, and document repositories between the cases are not the same. Of course, there will be documents produced in one case that are not produced in the other. In any event, AGG has refused to identify the documents produced in RJ which it believes should have been produced in this case, citing concerns that doing so would violate the Protective Order in that case. It is unclear how sharing Cigna's confidential information with Cigna would implicate confidentiality concerns, particularly since Cigna's in-house counsel agreed to authorize such disclosure, but without this information, Cigna cannot directly address the issue.[5]

Regardless, AGG admits that the documents Cigna produced in RJ were designated as “CONFIDENTIAL,” meaning that it was likely prohibited from using them for any purpose other than prosecuting the RJ litigation. The fact that plaintiffs seek to use those same documents to obtain discovery in this litigation undoubtedly violates the protective order in that case and reflects AGG's pattern and practice of ignoring the protections put in place by discovery orders. Plaintiffs would not have known of these documents but for AGG's involvement in the RJ litigation. This is plainly an improper use of confidential information for plaintiffs' benefit in this case.

Accordingly, Plaintiffs' motion to compel should be denied. Sincerely,

May 18, 2023

36786-0055

ERROL KING

errol.king@phelps.com

Direct 225 376 0207

Via Email: slarson@larsonllp.com

Special Master Stephen G. Larson

Larson LLP

555 South Flower Street, Suite 4400

Los Angeles, CA 90071

Re: TML Recovery, LLC, et al. v. Cigna Corporation, et al., Case No. 8:20-cv-0269

Dear Special Master Larson:

In response to your e-mail dated May 17, 2023, that requested the Parties to provide you with their respective positions in response to e-mails from both counsel for Plaintiffs and counsel for the Cigna Defendants that were also provided to you on May 17, defendants Viant, Inc. and MultiPlan, Inc. (collectively, “MultiPlan”) offer the following:

1. MultiPlan's Response To Plaintiffs' May 17, 2023 E-mail

A. Plaintiffs' Request Is Untimely.

*13 Plaintiffs attempt to re-open discovery and muck up this case comes too late and beyond all applicable case deadlines. Fact discovery is closed and has been closed. The document production deadline was back in the summer of 2022, and Plaintiffs did not raise any issues with respect to MultiPlan's production prior to that deadline. MultiPlan responded to Plaintiffs' Requests for Production on March 24, 2022.[1] In so responding, MultiPlan made it clear what documents it was agreeing to produce, and which requests MultiPlan was objecting to based on Plaintiffs' claims as alleged in the operative Second Amended Consolidated Complaint (the “Complaint”). MultiPlan's subsequent document production in this case was entirely consistent with its written discovery responses.

Moreover, as you may be aware, Plaintiffs also filed a nearly identical action against MultiPlan and its client, UnitedHealthcare—In re: Out of Network Substance Use Disorder Claims against United Healthcare, Case No. 8:19-cv-02075 (C.D. Cal.) (the “United Case”)—that proceeded through the discovery process in 2021.[2] Plaintiffs in the United Case were represented by the same counsel representing them in this action. Notably, MultiPlan's document production in this case was also entirely consistent with its document production in the similar United Case, and thus, Plaintiffs' counsel has known for years what documents MultiPlan believed were responsive to the allegations and claims at issue in this case.

Despite knowing all of this, Plaintiffs did not raise any issue—much less with respect to ESI or e-mails—until after MultiPlan's Motion for Summary Judgment was filed on April 17, 2023. Plaintiffs' initial meet and confer request that prompted this briefing did not come until two days later, on April 19. And, while the Parties did agree to conduct depositions after the March 10, 2023 deposition discovery deadline, the Parties did not agree to extend discovery for any other purposes. In fact, in an email dated March 23, 2023, counsel for Plaintiffs proposed adding some language to that effect in the Joint Request to Modify the Briefing Schedule, which was provided to your honor that same day; however, Defendants rejected that proposed language, making it clear that they understood fact discovery to be closed and that they were unwilling to extend discovery for any purpose other than the taking of a limited number of depositions that had previously been requested. Counsel for Plaintiffs agreed to the Defendants deletions, without further comment or argument.[3]

Additionally, while MultiPlan's Senior Vice President of Sales and Account Management, Monica Armstrong, was questioned generally about e-mails during her March 9, 2023 deposition, such questions did not put MultiPlan on notice that Plaintiffs were challenging MultiPlan's production or otherwise justify Plaintiffs' unreasonable delay in raising this issue with MultiPlan or your honor. Significantly, Plaintiffs did not leave Ms. Armstrong's deposition open, they did not make any request—on or off the record—for production of e-mails during or after her deposition, and MultiPlan heard nothing further on the issue of e-mails until Plaintiffs' April 19 meet and confer letter.

*14 Finally, as you know, Plaintiffs filed a motion to compel against the Cigna Defendants in August 2022 and chose not to file a similar motion against MultiPlan. In short, Plaintiffs were undeniably dilatory, and their present attempts are improper and come much too late.

It is also worth noting that Plaintiffs attempted this exact same tactic in the similar United Case referenced above. Specifically, Plaintiffs brought an untimely motion to compel after the discovery deadline, and the court denied the motion out of hand based on untimeliness.[4] The same result is warranted here.

B. Plaintiffs' Requests Are Not Reasonably Calculated To Lead To The Discovery Of Admissible Evidence.

Putting this issue of untimeliness aside (which is dispositive on its own), the claims and allegations in this case are completely different from the RJ matter referenced in Plaintiffs' May 17 e-mail to your honor. For example, the RJ matter involves RICO claims. And unlike the RJ case, there is no mention in the Complaint in this case of Viant OPR; crosswalking; HCPCS H0015; target rates; PAD letters; “usual and customary,” “reasonable and customary,” UCR, U&C, R&C or any of their progenitors; or anything along those lines. In short, this case and RJ are different cases, which obviously call for different discovery.

MultiPlan has asked counsel for Plaintiffs to point it to where any of these allegations appear in the Complaint, such that MultiPlan would have known that any of the alleged documents produced in RJ could have any bearing on this matter. To date, however, Plaintiffs have not provided this requested information, which is not a surprise because no such allegations are contained in the Complaint. Significantly, and to stress, all of this is a bit of an academic exercise because Plaintiffs have not identified for MultiPlan, or your honor, what specific documents from RJ they think are relevant and should have been produced in this case aside from Plaintiffs' general reference to “unquestionably responsive” documents.

C. Plaintiffs Requests Would Violate The Protective Order In RJ.

Finally, as Plaintiffs' correctly note, MultiPlan does not consent to using documents produced under the Stipulated Protective Order in RJ (the “RJ SPO”) in this case.[5] And MultiPlan has informed Plaintiffs that it will protect every right that it has with respect to any improper and unauthorized disclosures. The RJ SPO precludes all parties from showing confidential or attorneys' eyes only (“AEO”) RJ docs to anyone outside of the RJ case. That would include both the Cigna Defendants' counsel in this case, which is different counsel than in RJ, as well as both your honor and Judge Carter. MultiPlan would be violating the RJ SPO by allowing anyone other than MultiPlan's counsel and the AGG lawyers enrolled in RJ to see those documents. And with the upmost respect for your honor and this Court, MultiPlan does not believe that you could order MultiPlan to violate a lawful Protective Order entered in a separate case in a different court and by a different judge.

Likewise, the RJ SPO makes it clear that confidential and/or AEO RJ documents (and the information contained therein) can only be used for purposes of that case. It is MultiPlan's position that Plaintiffs' counsel are actually violating the RJ SPO by trying to use RJ documents for purposes of this case. If Plaintiffs' counsel actually thought the RJ documents were independently relevant to this case (which is denied), they should have moved to compel them prior to the close of discovery here.[6] And to stress again, Plaintiffs have not even identified what “responsive” documents they are referring to. This is clearly a meritless distraction.

2. MultiPlan's Response To The Cigna Defendants' May 17, 2023 E-mail

*15 With respect to the Cigna Defendants' May 17, 2023 e-mail to your honor relating to AGG's violation of the parties' Stipulated Protective Order entered in this case (the “SPO”), MultiPlan joins in Cigna's position and adopts and incorporates, as if fully set forth herein, the arguments made by Cigna in that May 17 e-mail, as well as those set forth in their brief filed contemporaneously herewith.

We appreciate your honor's time and attention to these issues, and we look forward to discussing them with you further during tomorrow's hearing.

Sincerely,

Errol J. King

EK:cj

Enclosures