A woman filed an action in connection with two motor vehicle accidents occurring on October and November of 2008. Both accidents were clearly not her fault. She suffered a multitude of injuries including headaches, neck and back pain, fractured ribs, pulled wrist tendon, pain in buttocks, right shoulder pain, and emotional instability. The accident victim subsequently received treatment from her primary care physician in order to resolve the injuries caused by the incidents.

Because there were two accidents, and the insurance companies that represented the two at-fault drivers refused to take accountability for their fair share of her injuries, she filed a lawsuit. As is the custom for the Insurance Industry, lawyers for the defendants immediately sent out subpoenas for our client’s private medical and financial information. There was no attempt whatsoever to limit the subpoenas to information solely related to the accidents that were at issue.

We raised objections to subpoenas for collateral source information, stating that any requests for collateral source information must be removed, or plaintiff would be forced to bring the instant Motion to Quash to protect such non-discoverable information. Collateral Source Payments are damages awarded to a party by another source, such as an insurance company. According to the Collateral Source Rule, defendants cannot request evidence and reduce the amount they owe in damages due to payments the victim has received from collateral sources. Consequently, our client’s personal financial information about her insurance payments was inadmissible. Whether or not she received payments from her insurance company did not eliminate the defendant’s obligation to compensate her for the injuries that were set in motion. However, the defendant sought to discover personal financial information from the victim in order to circuitously profit from the collateral source payments she received from her insurance company. This action defies the Collateral Source Rule. The defendant attempted to evade responsibility for the accident by benefiting from insurance payments made to our client. In response to our objections for collateral source information, the defendant’s representation stated that his firm would be unwilling to remove requests for collateral source information.

The court has the authority to quash or modify deposition subpoenas to protect the plaintiff’s right to privacy. Consequently, when a subpoena requires the . . . production of books, documents or other things before a court, upon motion reasonably made by the party . . . may make an order quashing the subpoena entirely, modifying it. In addition, the court may make any appropriate order to protect the parties, the witness, or the consumer from unreasonable or oppressive demands including unreasonable violations of a witness’s or consumer’s right of privacy.

Since the defendant is not a public entity or a defendant in a medical malpractice action, discovery of our client’s private collateral financial investment in health insurance is legally improper. Our client demands payment for the financial detriment she personally, contractually incurred in exchange for medical services from her providers. That claim does not place at issue her privileged, personal financial investments, which were made to protect herself against such detriment. The defendant clearly seeks to introduce the collateral source payments at a motion for post-trial reduction. However, the defendant provides no valid authority on which the court could conclude that the subject of these subpoenas could ever be admitted. The defendant is not entitled to discover what the medical providers have been paid by collateral sources, only the information as to what was billed.

The California Supreme Court recognized health insurance as a financial investment made by the plaintiff: The collateral source rule expresses a rule which encourages citizens to purchase and maintain insurance for personal injuries and for other eventualities. Courts consider insurance a form of investment, the benefits of which become payable without respect to any other possible source of funds. If we were to permit someone who commits a wrongdoing to benefit from a victim’s insurance, then people would not be inclined to buy insurance, because their payment of premiums would have earned no benefit. A defendant cannot avoid payment of full compensation for the injury inflicted merely because the victim has had the foresight to provide himself with insurance.

In addition, personal financial information comes within the zone of privacy protected by article I, section 1 of the California ConstitutionWhen privacy rights regarding financial affairs conflict with public need for discovery in litigation, the competing interests must be carefully balanced. A party seeking discovery of confidential information must show a particularized need, i.e., that the information is directly relevant to a cause of action or defense.

Under the general discovery statute, defendant would have to establish that collateral payments made by plaintiff’s health insurance are “not privileged” and either “admissible in evidence or appear reasonably calculated to lead to the discovery of admissible evidence.” Otherwise, defendant would need some specific statutory authority that permits such discovery.

The defendant’s claim that collateral source payment information is discoverable in all personal injury cases would obviate both provisions in the Civil Code, which permit discovery of collateral source payment information in personal injury cases involving medical malpractice and public entity defendants only.