IN THE CIRCUIT COURT OF THE FIFTEENTH

JUDICIAL CIRCUIT, IN AND FOR PALM

BEACH COUNTY, FLORIDA

CASE NO.: CL 95-1466 AH

THE STATE OF FLORIDA, et al.,

Plaintiff(s)

v.

THE AMERICAN TOBACCO COMPANY,

et al.,

Defendant(s)

ORDER DENYING DEFENDANTS' MOTION TO STRIKE PLAITIFFS' "LIST OF MEDICAID RECIPIENTS" FOR NONCOMPLIANCE WITH THIS COURT'S ORDER OF SEPTEMBER 16, 1996: ORDER FINDING PLAINTIFFS IN COMPLIANCE WITH COURT'S ORDER OF SEPTEMBER 16, 1996 THAT THE PLAINTIFFS PROVIDE THE IDENTITY OF EACH INDIVIDUAL RECIPIENT OF MEDICAID PAYMENTS FOR WHICH DAMAGES WILL BE CLAIMED UNDER THE 1994 ACT: AND ORDER TO REMAINING DEFENDANTS TO ANSWER THE STATE'S SECOND AMENDED COMPLAINT AS TO COUNTS I, II AND XVIII WITHIN 20 DAYS OF OCTOBER 15, 1996

On September 16, 1996 this Court entered its Order Granting, In Part, Defendants' Motions to Dismiss; Order Denying In Part, Defendants' Motions to Dismiss; and Order To The Parties To Conduct Further Mediation. At page 6 of the aforementioned Order this Court required:

…that the Plaintiffs provide the identity of each individual recipient of Medicaid payments for which damages will be claimed under the 1994 Act. The State shall file with the Clerk of this Court a list identifying each such individual recipient…

At the last hearing before the Court on October 10, 1996, one of the issues raised was whether or not the Court should clarify its aforementioned Order when it became apparent that the Plaintiffs would seek compliance with the Order by filing 44 boxes of documents containing the identification number of each Medicaid patient, a list of medical providers applicable to the particular Medicaid patient and a list of payments made to the provider on behalf of the Medicaid patient for which reimbursement is sought together with other numerical-coded information.

As a matter of fact on October 15, 1196, pursuant to the aforementioned Court's Order, the Plaintiffs did file 44 boxes identifying individual Medicaid patients by identification numbers without naming the persons. Included with each identification number is a list of medical providers and payments made to each provider with other numerical-coded information. A copy of one such listing is attached to this Order as Exhibit "A". The 44 boxes now filed in the Clerk's office contain several hundred thousand numerically identified Medicaid patients with medical provider recipients of payments listed similar to the disclosure made in Exhibit "A" attached hereto. The State seeks reimbursement for these payments to medical providers on behalf of these Medicaid patients.

On October 16, 1996 the Defendants filed a Motion to Strike Plaintiffs' List of Medicaid Recipients for Non-Compliance with this Court's Order of September 16, 1996. Memoranda from the parties have also been filed concerning "identity" issues and have been considered by the Court.

The Court finds the filing of October 15, 1996 is in compliance with the Court's Order of September 16, 1996 aforementioned and this Court orders the remaining Defendants in this litigation to answer the State's Second Amended Complaint as to Counts I, II and XVIII within 20 days of October 15, 1996. The Defendants' Motion to Strike is hereby DENIED.

The Court recognizes that individual Medicaid patients are not parties to this cause of action. The true recipients of actual payments for which the State seeks reimbursement in this case were medical care providers who are all listed as set forth in attached Exhibit "A"(together with the actual amounts paid to each provider all in reference to a specifically numerically identified Medicaid patient).

The State is pursuing a new and independent cause of action pursuant to the concept of market-share liability as enacted by the legislature in the 1994 Amendments to the law. There is now in place a "…mechanism for determining for whom the payments were made…"

It is now abundantly clear from the record in open Court at the October 10, 1996 hearing that the Plaintiffs will proceed in this case under the concept of market-share liability as enacted by the 1994 Amendments to the applicable Act. As the Supreme Court of Florida stated in Agency for Health Care Administration et al. V. Associated Industries Inc. et al., no. 86,213, slip. Op. (Fla. June 27, 1996) ("Associated Industries"):

…We find no constitutional basis to prohibit the Legislature from endorsing the use of a market-share theory for claims pursued under the Act…See Associated at p. 34.

Since the Plaintiffs have indicated their intention to pursue the market-share theory in this case (and not to apply the theory of joint and several liability), it negates the necessity at this time to specifically name individual Medicaid patients who are not parties to this action without some further showing of need. The Court agrees with the Plaintiffs' position that identifying patients beyond the disclosures made October 15, 1996 is now a discovery issue. The Court or the Special Master appointed in this case can fashion disclosures deemed necessary to afford the Defendants due process, fairness and ability to respond to the Plaintiffs' proof under the market-share theory.

After commencing discovery and making use of the identification, medical provider and payment information made available by the plaintiffs, if the Defendants seek disclosure of specific names, the Court may conduct further hearings at which issues of privilege, privacy, need, relevance, harassment, etc. may be addressed.

Finally, this Court notes some of the concluding remarks of the Florida Supreme Court in Associated at p. 26:

…Not all tort actions carry with them the same elements or affirmative defenses. The legislature must have the freedom to craft causes of action to meet society's changing needs. The United States Supreme Court has acknowledged this necessity and has tempered the legislative power of the States only with the rule against arbitrary or capricious actions. The State's action, as we have interpreted it, is neither arbitrary nor capricious. It is a rational response to a public need…

The only purpose at this time that the Court can determine in Defendants' obtaining the individual names of several hundred thousand Medicaid patients would be an attempt to argue to this Court that all of those named patients should be investigated and/or deposed in this case. Such a procedure may comport with a traditional view of tort litigation. However, the new and independent cause of action created by the Legislature and upheld by the Florida Supreme Court in Associated is one designed "…to meet society's changing needs." See Associated at p. 26.

The "acknowledged necessity" of pursuing an action of this type may not follow the traditional scope and methods of discovery used in traditional tort litigation to which we have all become accustomed. The new and independent tort created in 1994 coupled with the application of market-share theory is truly unique to Florida. It appears no other jurisdiction has a statute comparable to Florida's.

I do not believe the Florida Supreme Court in upholding the State's new and independent tort intended for the trial court to become bogged down in an endless stream of depositions and other pretrial discovery mechanisms not particularly suited to address the market-share concept. The Court will not become frozen in a snail's pace search for the truth. Certainly, sufficient ascertainable information must be provided to allow for the Defendants to properly investigate, challenge and/or rebut the State's theory under the market-share concept. The Court will make reasonably discoverable material available to the Defendants. However, once again all parties are reminded that certain tactical discovery and investigative decisions must be made with a view toward commencing trial in this case on August 4, 1997.

DONE AND ORDERED in Chambers in West Palm Beach, Palm Beach County, Florida on this 18th day of October, 1996.

HAROLD J. COHEN

CIRCUIT COURT JUDGE