Margie Hendricks and Myrtis Hendricks Williams v. Wells Fargo Insurance, Stericycle, Inc., Shadrack Long, Ortegas Coleman and Ean Holdings, LLC

• Court: Louisiana Court of Appeal
• Decided: March 9, 2022
• Docket: 2021-CA-0552
• Status: Published

Opinion

MARGIE HENDRICKS AND * NO. 2021-CA-0552 MYRTIS HENDRICKS WILLIAMS * COURT OF APPEAL VERSUS * FOURTH CIRCUIT WELLS FARGO INSURANCE, * STERICYCLE, INC., STATE OF LOUISIANA SHADRACK LONG, ORTEGAS ******* COLEMAN AND EAN HOLDINGS, LLC

APPEAL FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2018-01575 C\W 2018-02116, 2018-07267, 2018-08066, DIVISION “N-8” Honorable Ethel Simms Julien, Judge ****** Pro Tempore Judge Madeline Jasmine ****** (Court composed of Judge Edwin A. Lombard, Judge Joy Cossich Lobrano, Pro Tempore Judge Madeline Jasmine) LOBRANO, J., CONCURS IN THE RESULT

Matthew S. Chester Matthew C. Juneau BAKER DONELSON BEARMAN CALDWELL & BERKOWITZ, PC 201 St. Charles Avenue Suite 3600 New Orleans, LA 70170

COUNSEL FOR APPELLANT/SEAN ALFORTISH

McNeil Kemmerly Donald Edward McKay, Jr. Katie F. Wollfarth LEAKE & ANDERSSON, LLP 1100 Poydras Street Suite 1700 Metairie, LA 70163

COUNSEL FOR APPELLEES/STERICYCLE, INC., SHADRACK LONG, AND GREENWICH INSURANCE COMPANY

VACATED AND REMANDED March 9, 2022 MJ

EAL

This appeal arises from a personal injury suit following an August 2017

motor vehicle accident. The appellant, Sean Alfortish (“Mr. Alfortish”), a non-

party, appeals the trial court’s July 2021 judgment denying his motion to quash a

deposition subpoena. In that we find the trial court applied the wrong legal

standard, we vacate the trial court’s judgment and remand the matter to the trial

court for its reconsideration under the correct legal standard.

FACTUAL BACKGROUND AND PROCEDURAL HISTORY

The underlying personal injury suit consists of four consolidated personal

injury cases filed subsequent to an August 15, 2017 motor vehicle accident

between a van and an 18-wheel tractor trailer. The named defendants relevant to

this appeal are Shadrack Long, the driver of the tractor trailer, his employer,

Stericycle, and its insurer, Greenwich Insurance Company (collectively

1 “Appellees/Stericycle”)1, and the driver of the van, Ortegas Coleman. The alleged

accident occurred on I-10 in New Orleans on August 15, 2017 (“the August 2017

accident”), in which Shadrack Long merged from the left lane and struck the van

driven by Ortegas Coleman and in which plaintiffs were passengers. Stericycle

contends that the August 2017 accident was staged and that it is part of a larger

scheme of staged accident insurance fraud cases which led the FBI to open a

federal investigation that has garnered considerable media attention.

The parties in dispute herein, were previously before this Court in Hendricks

v. Wells Fargo Ins., Stericycle, Inc., 21-0109, p. 1-2 (La. App. 4 Cir. 10/27/21), ---

So.3d ---, 2021 WL 4987962, reh’g denied, 21-0109 (La. App. 4 Cir. 11/23/21)

(herein “Hendricks I”). In that appeal, this Court explained the factual background

giving rise to the instant dispute involving Mr. Alfortish as follows:

In the course of discovery, [Stericycle] associated Ortegas Coleman with Cornelius Garrison through phone calls between the men before and after the [August] 2017 accident. Cornelius Garrison had been indicted in federal court for conspiring to fraudulently stage motor vehicle accidents. Further discovery revealed that Cornelius Garrison had been in contact with another cell phone number and [Stericyle] issued a subpoena duces tecum to the cell phone provider, Sprint Spectrum, LP (“Sprint”) requesting two years of records for the specific cell phone number. That subpoena was met with a motion to quash filed on behalf of the owner of the cell phone number, Sean Alfortish.

Additionally, [Stericyle] filed a motion for leave of court to file supplemental and amending pleadings to assert a reconventional demand against Plaintiffs, a cross-claim against co-defendant Ortegas Coleman, as well as a third-party demand against Cornelius Garrison, alleging that the [August] 2017 accident was fraudulently staged. The pleadings further asserted that the subject accident was part of a wide- ranging conspiracy between the plaintiffs, Ortegas Coleman, and Cornelius Garrison to stage motor vehicle accidents and file personal injury claims against companies operating 18-wheel tractor trailers.

1 For ease of discussion, we refer to appellees Shadrack Long, Stericycle, and Greenwich Insurance Company singularly as “Stericycle.”

2 Hendricks I., 21-0109, p. 1-2, --- So.3d at ---, 2021 WL 4987962 at *1-2.

In Hendricks I, Stericycle appealed the trial court’s grant of Mr. Alfortish’s

motion to quash a pre-trial discovery subpoena directed to Sprint, for the period of

July 17, 2017, through January 1, 2019, including but not limited to billing

statements, cell sites activations, numbers dialed, and sent and received text

messages. Hendricks I, 21-0109, p. 2-3, --- So. 3d ---, 2021 WL 4987962 at *2.

This Court determined that the trial court did not abuse its discretion in granting

Mr. Alfortish’s motion to quash the subpoena for his cell phone records and

affirmed the trial court’s ruling.

In the instant appeal, Stericycle sought to compel the deposition of Mr.

Alfortish and to produce unspecified “records.” Mr. Alfortish filed a motion to

quash the deposition subpoena, arguing he is a “non-party, who did not witness the

accident, was neither a driver nor a passenger, and otherwise has no material

connection to the accident.” After a hearing on the motion, the trial court denied

the motion to quash, finding that counsel for Stericycle had indicated to the trial

court that counsel, not the trial court, “has a reasonable…belief that evidence that

can be adduced from Mr. Alfortish is relevant to these proceedings.” The trial

court further reasoned that in its view a subpoena to depose a non-party is different

than a subpoena to produce records of a non-party. It is from the trial court’s

denial of his motion to quash the deposition subpoena that Mr. Alfortish seeks

appellate review.

STANDARD OF REVIEW

A trial court is afforded broad discretion in its consideration of discovery

matters. Sercovich v. Sercovich, 11-1780 (La. App. 4 Cir. 6/13/12), 96 So. 3d 600,

603. On appellate review, this Court will not disturb the trial court’s ruling in the

3 absence of an abuse of discretion. Id. “An appellate court must balance the

information sought in light of the factual issues involved and the hardships that

would be caused by the court's order when determining whether the trial court

erred in ruling on a discovery order.” Id. (quoting Wollerson v. Wollerson, 29,183,

p. 2 (La. App. 2 Cir. 1/22/97), 687 So.2d 663, 665).

“When an appellate court finds the trial court made a reversible error of law,

it is required, whenever the state of the record on appeal so allows, to redetermine

the facts de novo from the entire record and render a judgment on the merits.”

Laboriel-Pitio v. Latiker, 20-0669, p. 15 (La. App. 4 Cir. 6/16/21), 323 So.3d 929,

938 (quoting Dileo v. Horn, 15-0684, p. 25 (La. App. 5 Cir. 3/16/16), 189 So.3d

1189, 1207). Nevertheless, “‘[t]he authority for an appellate court to remand a

case to the trial court for proper consideration, where it is necessary to reach a just

decision and to prevent a miscarriage of justice, is conferred by La. C.C.P. art.

2164.’”2 Laboriel-Pitio, 20-0669, p. 15, 323 So.3d at 938-39 (quoting Wegener v.

Lafayette Ins. Co., 10-0810, p. 19-20 (La. 3/15/11), 60 So.3d 1220, 1233-34).

“Whether a particular case should be remanded is a matter which is vested largely

within the court's discretion and depends upon the circumstances of the case.” Id.,

20-0669, p. 15, 323 So.3d at 939 (citation omitted).

DISCUSSION

On appeal, Mr. Alfortish avers that the trial court applied the incorrect legal

standard when it denied his motion to quash the deposition subpoena. Mr.

Alfortish asserts that the trial court’s oral reasons reflect that the trial court

2 La. C.C.P. art. 2164 provides: “The appellate court shall render any judgment which is just, legal, and proper upon the record on appeal. The court may award damages, including attorney fees, for frivolous appeal or application for writs, and may tax the costs of the lower or appellate court, or any part thereof, against any party to the suit, as in its judgment may be considered equitable.”

4 erroneously determined that a party may depose a non-party solely based on a

counsel’s reasonable belief that the information sought from the non-party is

relevant. Mr. Alfortish argues that there is no support under Louisiana law for a

party to obtain discovery from a non-party merely by representing that it has a

belief that the discovery sought is relevant to the case. Mr. Alfortish contends that

the same standard that applied to Mr. Alfortish’s motion to quash the cell phone

records in Hendricks I—a showing of relevancy and good cause—should apply in

the context of the deposition subpoena.

Stericycle, on the other hand, takes the position that the prerequisites of

relevancy and good cause do not apply in this case because the relief Mr. Alfortish

actually seeks in this case is a protective order pursuant to La. C.C.P. art. 1426.

Pursuant to La. C.C.P. art. 1426, the burden of proof is on the party seeking the

protective order to show good cause. Stericycle argues that Mr. Alfortish failed to

carry his burden and because discovery rules are to be liberally construed to

achieve their intended purpose, the trial court did not abuse its discretion in ruling

that Stericycle may depose Mr. Alfortish.

Stericycle also claims that even if the relevancy and good cause standard

applies to the deposition subpoena, the trial court “implicitly” found that Stericycle

met its burden of proof. Stericycle submits that the trial court indicated that it

viewed the deposition of Mr. Alfortish as being much less intrusive than the

production of cell phone records. Thus, Stericycle argues, the same evidence

presented for production of the cell phone records, although found to be

insufficient by the trial court and this Court, could suffice to compel the deposition

of Mr. Alfortish.

5 Despite Stericycle’s contention, the record reflects that Mr. Alfortish did not

move for a protective order under La. C.C.P. art. 1426. Mr. Alfortish filed a

motion to quash pursuant to La. C.C.P. art. 1354. Therefore, Stericycle’s argument

in this regard is without merit.

In our review, Louisiana jurisprudence does not address the specific scenario

presented here, where a non-party files a motion to quash a deposition subpoena,

rather than a motion to quash a subpoena seeking only documents. Nevertheless,

the Code of Civil Procedure demonstrates that the rules governing subpoenas for

documents and deposition subpoenas are the same. Specifically, La. C.C.P. art.

1356 relates to “Subpoenas and subpoenas duces tecum for depositions or

inspection” which provides in pertinent part that “[a]ll provisions applicable to

subpoenas and subpoenas duces tecum shall apply to subpoenas and subpoenas

duces tecum issued under the provisions of this Article, except as otherwise

provided by law.”

In Channelside Servs., LLC v. Chrysochoos Group, Inc., 15-0064 (La. App.

4 Cir. 5/13/16), 194 So.3d 751, a judgment creditor sought to enforce a money

judgment by obtaining a charging order against a limited liability company in

which the judgment debtor had a membership interest. The judgment creditor

issued a records deposition subpoena and subpoena duces tecum and the limited

liability company filed a motion to quash. On appeal, this Court recognized that

“Louisiana jurisprudence has required a showing of relevancy and good cause by a

party seeking production of records from a non-party.” Id., 15-0064, p. 11 (La.

App. 4 Cir. 5/13/16), 194 So.3d 751, 758 (citing Stolzle v. Safety & Sytems Assur.

6 Consultants, Inc., 02-1197, p. 3 (La. 5/24/02), 819 So.2d 287, 289).3 Giving

consideration to the relevancy and good cause standard, we found the trial court

abused its discretion. This Court reasoned that ordering the production of

documents back to January 1, 2011, had no relevance to an underlying money

judgment in 2013 or the assignment of a membership interest in 2014, and

therefore, “the trial court’s order to produce documents dating back to January 1,

2011[,] was not sufficiently supported by any relevance or showing of good

cause.” Id., 15-0064, p. 19, 194 So.3d at 762.

Further, in St. Bernard Port, Harbor & Terminal Dist. v. Violet Dock Port,

Inc., LLC, 14-0286, (La. App. 4 Cir. 8/27/14), 147 So.3d 1266, a port operator and

his consulting firm, non-parties to the port district’s expropriation action, filed a

motion to quash subpoenas and subpoenas duces tecum relating to the non-party’s

valuation records. The trial court denied the motion to quash without providing

reasons for its judgment. Id., 14-0286, p. 3, 147 So.3d at 1268. This Court found

the trial court abused its discretion and reversed the ruling denying the motion to

quash, concluding that the port district failed to make showings of relevancy and

good cause. Id., 14-0286, p. 9, 147 So.3d at 1270.

Mr. Alfortish submits that notwithstanding the trial court’s error in its

application of the law, reversal is warranted because there is no cause, much less

good cause, to burden him with a deposition in a case to which he claims no

connection. Mr. Alfortish contends that this Court should reverse the trial court’s

denial of the motion to quash the deposition subpoena because Stericycle sets forth

the same arguments and evidence to justify the deposition subpoena as the

3 In Hendricks I, this Court also held that “[p]rior to ordering discovery from a third party, […] the trial court must be convinced of the relevancy and necessity of such discovery in achieving its intended objective.”

7 subpoena duces tecum in Hendricks I—that the accident was staged and related to

the federal indictment concerning a larger scheme of staged accident insurance

fraud cases, which Stericycle alleges Mr. Alfortish is involved. Despite the prior

denial of document discovery in Hendricks I, Mr. Alfortish asserts that Stericycle

“ignor[ed] prior guidance [from this Court] that Mr. Alfortish was irrelevant to this

case” when it served him with the deposition subpoena.

The argument Mr. Alfortish sets forth on appeal suggests that the prior

denial of the document discovery, and in particular, this Court’s affirmation of the

trial court’s ruling has precedential value on the issue presented herein. We are

careful to note, however, that this Court’s previous opinion in Hendricks I does not

state nor should it be interpreted as constituting a full adjudication of the factual

question of whether Mr. Alfortish is involved in or has knowledge of a conspiracy

to stage the alleged accident at issue in this litigation.

Mr. Alfortish avers that trial court erroneously found that a party may

depose a non-party solely based on a counsel’s reasonable belief that the

information from the non-party is relevant, rather than applying the well-settled

standard of showing relevancy and good cause. In its oral reasons for denying the

motion to quash, the trial court stated the following:

As the Court indicated when [c]ounsel was arguing, given that the representation has been made that [c]ounsel has a reasonable – a belief or a belief that evidence that can be adduced from Mr. Alfortish is relevant to these proceedings, the Court is going to deny the motion to quash the subpoena.

I don’t know what’s happened with the Fourth Circuit relative to the cell phone records. The Court views cell phone records of a non- party differently from how we view subpoenas for deposition of a non-party. Non parties are deposed all the time for civil cases, but normally their personal records are not subpoenaed without there being some good cause.

8 Mr. Alfortish avers that the trial court’s oral reasons expressly state that the

basis for its ruling was Stericycle counsel’s “reasonable… belief” that evidence

adduced from Mr. Alfortish would be relevant to the instant litigation—not that

Stericycle actually demonstrated good cause and relevancy for the deposition of a

non-party.

Alternatively, Stericycle’s contention that the trial court “implicitly” found a

showing of good cause and relevancy focuses on the latter portion of the trial

court’s reasoning, wherein the trial court determined cell phone records of a non-

party are viewed differently than a deposition subpoena of a non-party. Stericycle

submits that implicit in this statement is the trial court’s consideration of the

relevancy of the evidence Stericycle presented and if good cause was shown. That

is to say, while the trial court determined good cause and relevancy was not shown

for the issuance of the subpoena for the production of cell phone records, good

cause and relevancy was shown for the issuance of the deposition subpoena.

As discussed above, the Code of Civil Procedure establishes that the rules of

discovery apply the same to subpoenas and subpoenas duces tecum. See La.

C.C.P. art. 1356. Louisiana jurisprudence, moreover, demonstrates that the

standard the trial court is to apply when considering a motion to quash a discovery

subpoena is whether the issuing party has demonstrated relevancy and good cause.

See Channelside, 15-0064, p. 11, 194 So.3d at 758; St. Bernard Port, 14-0286, p.

5, 147 So.3d at 1268. Our jurisprudence further indicates that the relevancy and

good cause test applies the same to subpoenas and subpoenas duces tecum. See

generally Channelside, 15-0064, p. 1, 194 So.3d 751; St. Bernard Port, 14-0286, p.

1, 147 So.3d 1266; Menedez-Ramos v. Garcia Roofing, unpub., 2019 WL

1233425, 18-713 (La. App. 5 Cir. 3/15/19) (reversing the trial court’s granting of a

9 motion to quash the deposition testimony of a non-party physician who examined

injured plaintiff in connection to his workers’ compensation claim, finding

physician’s testimony relevant to the issue of the nature and extent of the plaintiff’s

injuries).

It is unclear from the record before us what test the trial court applied to

deny the motion to quash. The written judgment is silent regarding what standard

the trial court applied as well as what factual findings it made. As evidenced by

the parties’ competing interpretations, the trial court’s oral reasons are open to

question as to what test the trial court used to deny the motion to quash.

Nevertheless, on appellate review we must rely on the record before us. Thus,

insofar as the basis of the trial court’s ruling was counsel’s belief, rather than its

own finding, that relevant evidence could be adduced from deposing Mr. Alfortish,

the trial court incorrectly applied the good cause and relevancy test.

Considering this standard and the particular legal error involved, we are of

the opinion the circumstances presented in the instant case warrant remand.

Moreover, since the filing of this appeal, Mr. Alfortish asserts that there are

additional facts and evidence for the trial court to consider, including the testimony

of the two drivers in the alleged accident, and the depositions of six other

participants in the alleged accident. For these reasons, we find the trial court, as

the trier of fact, is in the best position to render its factual findings on the evidence

before it.4

DECREE

4 This Court recognizes that on discovery matters, the trial court is vested with much discretion. Accordingly, we make no ruling on the merits of the motion to quash the deposition subpoena and remand the matter to the trial court to ensure the correct legal standard is adhered to.

10 Based on the foregoing reasons, we find the trial court committed legal error

in finding that “counsel” for Stericycle professed a “reasonable belief” that a

deposition of Mr. Alfortish could produce relevant evidence, rather than a finding

that Stericycle demonstrated relevancy and good cause for such deposition.

Therefore, we vacate the judgment on appeal and remand the matter to the trial

court for entry of a new judgment reflecting the trial court’s findings of fact under

the good cause and relevancy standard as set forth in Channelside and St. Bernard

Port.

VACATED AND REMANDED