*1 Defendants have filed a submission before the Special Master in which they seek an order compelling Plaintiffs to “produce the original, unaltered Assignor Data reflecting insulin purchases and rebates” for each of the remaining assignors. Although Defendants initially presented this submission in letter form, Defendants’ application is, in fact, a motion to compel discovery and will be treated as such by the Special Master.

In deciding this motion, the Special Master has reviewed and considered the following:

Additionally, this dispute was discussed during a status conference on May 5, 2023 (the “May 5 Conference”).

After considering all of the foregoing, and based upon the following analysis, it is the opinion of the Special Master that Defendants’ motion to compel Plaintiffs to produce the original, unaltered (“raw”) assignor data is GRANTED within the parameters set forth in this Order and Opinion.

I. Procedural History and Statement of Facts.

The parties, of course, are intimately familiar with the procedural events and underlying facts that give rise to this motion. Therefore, the Special Master will provide only a brief summary of those facts and events pertinent to this request.

Plaintiffs are MSP Recovery Claims Series, LLC; MAO-MSO Recovery II, LLC; Series PMPI; and MSPA Claims I, LLC (collectively, “Plaintiffs” or “MSP”). Defendants are Sanofi-Aventis U.S. LLC, Novo Nordisk Inc. and Eli Lilly and Company (“Defendants”). Each of the defendants manufacture insulin products designed to treat patients who have been diagnosed with diabetes.

Plaintiffs assert claims on behalf of certain assignors, that is, on behalf of a series of private health plans, which provide prescription drug coverage, including insulin, to their respective members. Plaintiffs seek to recover, as assignees, monetary damages, which they assert were caused by Defendants who, they claim, have employed an insulin pricing scheme that has unlawfully increased the purchase price of that medicine. Plaintiffs further contend that these health plans, from which they have received their assignments, suffered financial harm as a consequence of this scheme.

The Special Master has managed discovery in this matter for several years, during which discovery disputes have arisen concerning documents maintained by the assignors as to payment for insulin claims made by members of their respective health plans. The instant motion is yet another dispute which centers on what Plaintiffs, as the assignees, are obligated to produce after having retrieved that documentation from the assignor-health plans. Effectively, this is electronically stored information, often referred to as “ESI.”

Here, Defendants seek to compel MSP to provide “raw” data from its assignors rather than the “filtered” data that MSP produced. MSP has conceded that the data produced is “filtered,” meaning that MSP first obtained raw data from the assignors, filtered that data into a format that MSP contends still provides relevant insulin claims and payment information, and then produced the filtered data to Defendants. However, Defendants dispute that MSP has adequately responded to their discovery demands and now seek the “original” or “raw” or “unfiltered” data which, they say, is absolutely necessary to defend their interests in this litigation.

II. Defendants’ Argument.

*2 Defendants say they initially requested the assignor data by way of a request for production of documents (“RFP”), dated November 10, 2020. There are four RFPs at issue, numbers 13-16, which essentially seek documents and data as to the assignors’ insulin spending, rebates, details for each insulin prescription administered (including the payor name, pharmacy, drug, etc.), and any additional information reasonably expected to be found in an assignor's claims data. In response, MSP agreed to produce this data, but objected to the extent that the request sought “creation of documents or data that did not exist or are not ordinarily kept in the normal course of business.” Consequently, MSP did not produce “raw” assignor data, but rather, its own compilation of insulin claims created for the purpose of this litigation.

Defendants further argue that despite efforts to address perceived deficiencies in the production over the ensuing months and indeed into the following year, MSP failed to produce any “raw” data. Thereafter, during certain depositions, assignor witnesses testified that they possessed the original data and had provided that data to MSP in an unaltered form. Then, in March and April of 2023, the issue “came to a head” when Defendants confirmed that Plaintiffs possessed, but would not produce, the original, unaltered data, and Defendants raised the issue during the May 5 Conference.

Defendants insist that MSP must produce the assignor data in unaltered form, relying in part upon the Special Master's prior Report and Recommendation (“R&R”), which stated that “a party bringing an assigned claim must produce discovery on the same basis to which the defendants would have been entitled if an assignor had brought the claim directly.” (ECF No. 150, at p. 5.) Defendants maintain that this dispute falls squarely within the requirements of that R&R, which was later affirmed by the District Court.

Defendants further argue that the data produced thus far is an insufficient response to their RFPs. They first take issue with MSP's suggestion that the existing document requests do not cover original, unaltered data. That is, MSP has taken the position that none of the RFPs “requested ‘unaltered data,’ ‘raw claims data,’ or a similar request.” Defendants maintain that the request is not new and there is no need to issue a new RFP to obtain the assignor data.

Defendants also argue that the data that was provided is incomplete for a variety of reasons. Among the deficiencies, the data does not identify any rebates, discounts, or price concessions received by the assignors. The data also does not identify the name or type of health plan that bore financial responsibility for each insulin prescription, which is information needed to distinguish between entities that assigned claims to MSP and those that did not. The data also lacks sufficient information to identify the amount paid to pharmacies, which is relevant to calculating whether an assignor suffered any damages. Furthermore, the data does not contain information as to the state wherein each prescription was dispensed, which is information significant to this litigation because MSP is only bringing claims under certain states’ laws.

Defendants also assert that the data produced is altered and unintelligible, containing indecipherable combined fields, which cannot be understood without the original assignor data. Defendants point to alleged discrepancies and omissions that demonstrate the insufficiency of the data and also raise questions as to how MSP translated the original assignor data. Accordingly, there is no question that MSP has altered the data, thereby prejudicing Defendants’ defense of this action.

Defendants disagree with MSP's argument that producing raw data would be unduly burdensome. While MSP asserts that Defendants are seeking data for all pharmacy claims, Defendants argue that they are only seeking assignors’ data for the at-issue insulin products. Similarly, while MSP insists that it would take a significant amount of time and expense to “scrape” the relevant data, several assignors have testified that they produced the data to MSP in an unaltered form. Defendants argue that MSP chose how to collect the data and the fact that it failed to limit collection to insulin data is a problem that rests on Plaintiffs’ shoulders alone. Additionally, if “incidental information” (meaning information about other drugs or medical services) were produced, that information would be protected from public disclosure by the parties’ confidentiality order.

*3 Defendants also argue that this request is not time-barred. Rather, Defendants have been requesting the subject data for more than two years while discovery remains ongoing.

Finally, in response to MSP's “informal request” for cost shifting, Defendants maintain that this request is without merit. Relying on Third Circuit law as well as a prior order of the Special Master in this litigation, Defendants assert that there is a general presumption that the responding party must bear the expense of complying with discovery requests. Cost shifting is only considered when production of electronic discovery imposes an undue burden or expense and is potentially appropriate only when “inaccessible data” is sought. Juster Acquisition Co., LLC v. N. Hudson Sewerage Auth., No. 12-3427, 2013 WL 541972 at *3 (D.N.J. Feb. 11, 2013). Here, MSP does not argue that the requested data is inaccessible, especially given that Plaintiffs would have accessed this information to create the filtered data that was produced. Even if Plaintiffs could show inaccessibility, Defendants argue, MSP has failed the “seven-factor cost-shifting test” used in this Circuit. Id. at *4. That is, the request is specifically tailored to relevant information, there are no other sources, the total cost pales in comparison to the amount in controversy, the cost associated with production is due to MSP's own making and avoidable, and Plaintiffs failed to substantiate the claimed cost of production.

Accordingly, Defendants contend that the Special Master should order MSP to produce the original unaltered insulin data.

III. Plaintiffs’ Opposition.

MSP argues that Defendants’ motion should be denied because it is untimely and not proportional to the needs of the case.

Plaintiffs describe Defendants’ demand as a “belated request” for claims data for which they have failed to demonstrate good cause or excusable neglect. Plaintiffs say that they have effectively produced the data on five separate occasions between December 23, 2020, and April 14, 2023, including detailed information regarding the column designations and other information requested to evaluate the claims data reports. MSP further argues that Defendants are making specious claims that they have requested unaltered or raw data, but this is belied by their own discovery requests and a specific request for “raw” claims data was not made until April 2023 – more than two years after the initial RFPs.

As to proportionality, Plaintiffs rely on the declaration of MSP's Chief Information Officer and Records Custodian, Christopher Miranda, Jr., who has stated that, among other things, MSP has already spent a significant amount of time creating and customizing the data collection that MSP produced by way of proprietary software. The system is housed in a facility in Coral Cables, Florida, and can identify payments made by each assignor of the subject insulin drugs.

MSP, in the declaration, confirms that it receives and possesses raw medical claims data transferred by assignors, in the format maintained by the assignors, but that the claims data “represents every transaction for medical services provided by the assignor.”

Mr. Miranda has reviewed the raw claims data from the remaining twelve assignors. He asserts that the data includes pertinent payment information such as transaction date, purchase location, medical provider, drug dosage, NDC code, co-pays and adjusted price. Citing one example (AvMed), the data shows more than 146,000 insulin claims for approximately 5,600 members.

*4 MSP argues that to produce the data would be unduly burdensome. To provide a sense of scale as to the volume analyzed by the MSP system, Plaintiffs cite three assignors (AvMed, SummaCare and Fallon Community Healthcare) whose data totals more than six million records. Additionally, the records contain protected health information for individual members and have no associated payment for insulin products. Providing this information would effectively violate HIPAA standards, since the data is not limited to the “minimum necessary” to accomplish the intended purpose.

In the affidavit, Mr. Miranda concludes that the production of the raw data segregated for just insulin claims would require seventy-eight hours of development, two developers, in excess of $34,000 in costs, and would not be completed until June 21.[1] While still opposing Defendants’ request, if the Special Master should order production, MSP argues that Defendants must be required to bear the cost. Fed. R. Civ. P. 26(c)(1); Major Tours Inc. v. Colorel, No. 05-3091, 2009 WL 3446761 at *5-6 (D.N.J. Oct. 20, 2009).

IV. Defendants’ Reply.

On June 12, 2023, Defendants requested leave to file a reply, which the Special Master granted. Defendants assert that MSP has failed to offer any reason why the data should not be produced, instead insisting that in its view, Defendants do not need the assignor data. Defendants respond that the data is not cumulative or duplicative and that MSP has effectively conceded that the assignor data and the MSP-filtered data are not the same. Further, contrary to MSP's assertion that Defendants have had ample opportunity to obtain the information, Defendants reiterate that they have been seeking the data for years and had previously moved to compel MSP to conduct “hard pulls” for data. Additionally, the data is not outside of the scope permitted by Rule 26(b)(1) as MSP does not even dispute that the data is relevant. As to proportionality, MSP ignores most of the proportionality factors under the rule, including importance, amount in controversy, and relative access.

Finally, in response to MSP's assertion that it would need to exclude non-insulin data in order to comply with HIPAA requirements, the “minimum necessary” standard does not apply to disclosures in response to discovery requests when a qualified protective order exists. Such is the case here. Therefore, there is no need for MSP to segregate insulin from noninsulin claims.

V. Analysis and Findings.

The Special Master orders MSP to produce the raw data, without any cost shifting. There are several factors that support this outcome.

First, there is no dispute that Plaintiffs’ assignors initially provided to MSP “raw” and “unfiltered” data. Accordingly, what Defendants seek not only exists, but had been provided to and is effectively in the possession of MSP and has been for some time. In short, Plaintiffs chose to collect the data in this fashion and then, also on MSP's own volition, deliberately recreated or revamped the data in a form seemingly more useful to MSP than in its “raw” form. This resulted in a scenario in which Plaintiffs by their own choice and for their own convenience, took what amounts to an additional step – and arguably an unnecessary one – but now take the position that having done so, they are under no obligation to produce the data in the form in which it was initially collected.

Second, as Defendants argue, had this matter involved only a single assignor, and had that assignor sought the same relief MSP seeks here, there would be no doubt that the assignor would be obligated to produce information in a “raw,” unfiltered form. As Defendants emphasize, this aspect of discovery in this matter has been the subject of existing orders, which require MSP to produce discovery on the same basis to which Defendants would have been entitled if an assignor had brought a claim directly. The fact that Plaintiffs made a strategic decision to “group” the assignors and transform their data into a form more user-friendly to MSP's data collection software, should not stand as an impediment to Defendants’ request for the original assignor data which was, in fact, provided by the assignors to MSP.

*5 Third, whether the data provided by MSP is substantially similar to or equally useful to Defendants, as MSP claims, misses the mark. The Special Master finds that Defendants have raised sufficient concerns that the data that has been produced is to some degree altered or incomplete. Under these circumstances, MSP, which has admittedly collected and is in possession of the original data, cannot be the arbiter of whether the data it has produced to date is sufficient for Defendants’ purposes.

Fourth, Plaintiffs have also raised alleged HIPAA concerns. More specifically, Plaintiffs contend that the raw data includes medications other than insulin. However, MSP's concerns are overstated for two reasons: (1) MSP made a decision to collect information in this fashion and (2) there is a protective order in place to secure the confidentiality of this data. Therefore, even if this information were to be produced and contain data about medication other than insulin, the “minimum necessary” requirement does not apply to “uses or disclosures required by law” under the Code of Federal Regulations. See 45 C.F.R. § 164.502(b)(2)(v); 45 C.F.R. § 164.512(a)(e)(1); 45 C.F.R. § 164.512(e)(1)(v).

Fifth, as to Plaintiffs’ assertion that Defendants never actually requested unaltered or raw data, the Special Master finds that this argument is without substantial merit. While Defendants’ RFPs do not specifically use the terms “raw” or “unaltered,” a fair and reasonable reading of the demands undoubtedly leads to the conclusion that Defendants were seeking what amounts to the source materials possessed by the assignors as to the insulin claims. For example, the RFPs seek “documents (including but not limited to data sufficient to show ... the total amount each assignor spent on insulin ...” (RFP No. 13); “documents (including but not limited to data) sufficient to show the following information about each insulin prescription dispensed or administered ...” (RFP No. 14); “To the extent not covered by [previous requests] ... (including but not limited to data) sufficient to show the following information for all pharmacy rebates, credits, or other discounts ...” (RFP No. 15); and “documents (including but not limited to data) sufficient to show the following information regarding rebates, credits or any discounts on insulins ... passed onto plan sponsors” (RFP No. 16). Clearly, the original data at issue was requested by Defendants and it would be a waste of the litigants’ and the court's time and effort to compel them to reissue a RFP effectively seeking the same data.

Finally, as to cost shifting, and as Defendants argue, this rarely-used option is considered when discovery imposes an undue burden or expense and when data is inaccessible. As our courts have stated, there is a general presumption that the responding party must bear the expense of complying with discovery requests. The responding party also has the burden of proof on a motion or request for cost-shifting to demonstrate cost-shifting is warranted. Juster, 2013 WL 541972 at *3 (citing Zubulake v. UBS Warburg LLC, 216 F.R.D. 280, 283 (S.D.N.Y. 2003)). It is evident that the data at issue is fully accessible, and that it was MSP's decision to convert that data into a form that would be more useful when employed with its proprietary software. Therefore, MSP itself created the very circumstances leading to what it now purports to have resulted in an undue burden and expense, i.e., the need to re-convert the data back to an unaltered or “raw” form. Consequently, Plaintiffs have failed to meet their burden in this regard and are unentitled to shift the costs of production to Defendants.

VI. Conclusion.

*6 For the reasons set forth above, Defendants’ motion is GRANTED. The Special Master further ORDERS that Plaintiffs produce the original, unaltered assignor data at issue for each of the remaining assignors within thirty (30) days of the date of this Order and Opinion.