OP ALA, Justice.
¶ 1 The issues we are asked to decide in this original proceeding are whether in the
pretrial discovery stage
(1) a tort defendant may be compelled to produce financial rec
ords
in advance of
the judge’s in-trial decision that would submit to the jury the plaintiffs plea for punitive damages and (2) if the materials sought by the plaintiff be discoverable at that stage, should the court hold a hearing to consider a requested protective order by whose terms the discovered material would remain under seal until the punitive-damages phase of the trial? We answer both questions in the affirmative.
¶ 2 Dale Clayton Thompson, Sr. and his wife Shirley (Thompson) sued certain members of a self-insurance association organized by a group of employers (employers’ group or group) to provide workers’ compensation benefits to their employees. Dale had been injured in the course of his employment. He secured in the Workers’ Compensation Court an award of benefits, but was unsuccessful in obtaining payments that were due. When the employers’ group declared itself unable to pay, Dale commenced a district court action. He then received a payment upon his award. At that point he amended the claim by including a punitive-damages plea for the group’s alleged “bad faith” in failing to satisfy the award.
In the pretrial stage of the action the respondent judge ordered that the group’s financial statements and tax returns stand subject to discovery,
rejecting the group’s request for a protective order.
The hearing transcript (but not the order’s text) reveals the judge’s view that, under the provisions of Oklahoma’s Discovery Code, financial records are indeed discoverable in advance of trial. In his opinion, the Code supplanted all earlier jurisprudence. The latter
proscribes pretrial discovery of a tort defendant’s financial condition.
¶ 3 We hold that although the documents in contest here may indeed be the subject of pretrial discovery, their fitness,
qua
sensitive financial records, for protection from
premature public disclosure
as well as from pretrial delivery should be reconsidered upon their
in camera
inspection.
I.
THE ANATOMY OF LITIGATION
¶ 4 Claimant Dale Clayton Thompson, Sr., sustained in 1987 an on-the-job injury while working for Bullard’s Oilfield Service. Found temporarily totally disabled, he was granted benefits by the Workers’ Compensation Court. The award was not appealed. After Thompson failed to receive the payments when due, he brought a district court action against his employer and numerous members of the employers’ unincorporated self-insurance group.
¶ 5 Although, after the suit’s commencement, the group made a payment upon the compensation award, the record is unclear whether the entire obligation has been satisfied. Thompson’s district court petition was later amended by the addition of an exemplary-damages plea for “bad faith refusal to pay the benefits.”
¶ 6 To support his exemplary-damages plea Thompson demanded the group’s pretrial production of certain documents with financial information. His quest included tax returns, financial statements, confidential business deeds, transfers of property, stock certificates, certificates of deposit, and bank statements. The group requested a protective order. The respondent judge
limited the scope of compelled discovery
to “complete financial statements and complete federal and state income tax returns for the years 1991 to the present,” but his ruling declined otherwise to protect the compelled material. Respondent’s order would allow for the “expansion” of discovery if the tax returns and financial statements did not prove “sufficient
to disclose ... financial information about the Defendants’ financial worth.”
¶ 7 The group, which assails in this proceeding the discovery order’s
enforceability,
seeks prohibition. Reliance is placed on extant jurisprudence that proscribes pretrial discovery of a defendant’s financial worth based on no more than
allegations
of bad faith.
Thompson reminds us that the provisions of 12 O.S.1971 § 548 (now repealed),
which
at one time
required “good cause” for the production of documents, stand superseded by the Oklahoma Discovery Code, 12 O.S. 1991 § 3226
et seq.
(Discovery Code or Code). It is argued that the new statute’s provisions, 12 O.S.1991 § 3226(B)(1),
do not contain the “good cause” requirement and would hence allow the pretrial discovery sought by him here.
¶ 8 We take original cognizance of these causes to re-examine pertinent jurisprudence of yore in light of massive statutory revisions that were enacted since this court’s last opportunity in
Cox v. Theus (Cox)
to place a gloss upon the provisions of the now-repealed § 548.
¶ 9 II.
OKLAHOMA’S STATUTORY SCHEME OF YORE, AS WELL AS HER INTERPRETATIVE JURISPRUDENCE, DISALLOW PRETRIAL DISCLOSURE OF A DEFENDANT’S FINANCIAL RECORDS.
¶ 10 The statute that governed discovery of documents at the time of our decision in
Cox
was enacted in 1965 as 12 O.S. § 548.
That statute provided that
any party in the case
could request by motion the production of documents for inspection and. copying (and for other purposes pertinent to that kind of evidence).
“Good cause” was required to be shown.
The trial judge was vested with “equitable power” to protect parties and witnesses from disclosures which could cause “annoyance, embarrassment, or oppression.”
¶ 11 In
Cox v. Theus
this court was called upon to examine the provisions of 12 O.S. 1971 § 548 with a view to determining if “good cause” could be shown to support the plaintiff’s quest — made at the
pretrial
stage — for production of financial records to be used in support of the petition’s plea for punitive damages.
Punitive (exemplary) damages were then governed by the provisions of 23 O.S. 1971 § 9, originally enacted in 1910.
That one-sentence section authorized “damages for the sake of example” when a tort defendant “was found guilty” of “oppression, fraud, or malice.”
The 1910 antecedent of 23 O.S.1971 § 9
neither
set a stage for special proceedings
nor
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OP ALA, Justice.
¶ 1 The issues we are asked to decide in this original proceeding are whether in the
pretrial discovery stage
(1) a tort defendant may be compelled to produce financial rec
ords
in advance of
the judge’s in-trial decision that would submit to the jury the plaintiffs plea for punitive damages and (2) if the materials sought by the plaintiff be discoverable at that stage, should the court hold a hearing to consider a requested protective order by whose terms the discovered material would remain under seal until the punitive-damages phase of the trial? We answer both questions in the affirmative.
¶ 2 Dale Clayton Thompson, Sr. and his wife Shirley (Thompson) sued certain members of a self-insurance association organized by a group of employers (employers’ group or group) to provide workers’ compensation benefits to their employees. Dale had been injured in the course of his employment. He secured in the Workers’ Compensation Court an award of benefits, but was unsuccessful in obtaining payments that were due. When the employers’ group declared itself unable to pay, Dale commenced a district court action. He then received a payment upon his award. At that point he amended the claim by including a punitive-damages plea for the group’s alleged “bad faith” in failing to satisfy the award.
In the pretrial stage of the action the respondent judge ordered that the group’s financial statements and tax returns stand subject to discovery,
rejecting the group’s request for a protective order.
The hearing transcript (but not the order’s text) reveals the judge’s view that, under the provisions of Oklahoma’s Discovery Code, financial records are indeed discoverable in advance of trial. In his opinion, the Code supplanted all earlier jurisprudence. The latter
proscribes pretrial discovery of a tort defendant’s financial condition.
¶ 3 We hold that although the documents in contest here may indeed be the subject of pretrial discovery, their fitness,
qua
sensitive financial records, for protection from
premature public disclosure
as well as from pretrial delivery should be reconsidered upon their
in camera
inspection.
I.
THE ANATOMY OF LITIGATION
¶ 4 Claimant Dale Clayton Thompson, Sr., sustained in 1987 an on-the-job injury while working for Bullard’s Oilfield Service. Found temporarily totally disabled, he was granted benefits by the Workers’ Compensation Court. The award was not appealed. After Thompson failed to receive the payments when due, he brought a district court action against his employer and numerous members of the employers’ unincorporated self-insurance group.
¶ 5 Although, after the suit’s commencement, the group made a payment upon the compensation award, the record is unclear whether the entire obligation has been satisfied. Thompson’s district court petition was later amended by the addition of an exemplary-damages plea for “bad faith refusal to pay the benefits.”
¶ 6 To support his exemplary-damages plea Thompson demanded the group’s pretrial production of certain documents with financial information. His quest included tax returns, financial statements, confidential business deeds, transfers of property, stock certificates, certificates of deposit, and bank statements. The group requested a protective order. The respondent judge
limited the scope of compelled discovery
to “complete financial statements and complete federal and state income tax returns for the years 1991 to the present,” but his ruling declined otherwise to protect the compelled material. Respondent’s order would allow for the “expansion” of discovery if the tax returns and financial statements did not prove “sufficient
to disclose ... financial information about the Defendants’ financial worth.”
¶ 7 The group, which assails in this proceeding the discovery order’s
enforceability,
seeks prohibition. Reliance is placed on extant jurisprudence that proscribes pretrial discovery of a defendant’s financial worth based on no more than
allegations
of bad faith.
Thompson reminds us that the provisions of 12 O.S.1971 § 548 (now repealed),
which
at one time
required “good cause” for the production of documents, stand superseded by the Oklahoma Discovery Code, 12 O.S. 1991 § 3226
et seq.
(Discovery Code or Code). It is argued that the new statute’s provisions, 12 O.S.1991 § 3226(B)(1),
do not contain the “good cause” requirement and would hence allow the pretrial discovery sought by him here.
¶ 8 We take original cognizance of these causes to re-examine pertinent jurisprudence of yore in light of massive statutory revisions that were enacted since this court’s last opportunity in
Cox v. Theus (Cox)
to place a gloss upon the provisions of the now-repealed § 548.
¶ 9 II.
OKLAHOMA’S STATUTORY SCHEME OF YORE, AS WELL AS HER INTERPRETATIVE JURISPRUDENCE, DISALLOW PRETRIAL DISCLOSURE OF A DEFENDANT’S FINANCIAL RECORDS.
¶ 10 The statute that governed discovery of documents at the time of our decision in
Cox
was enacted in 1965 as 12 O.S. § 548.
That statute provided that
any party in the case
could request by motion the production of documents for inspection and. copying (and for other purposes pertinent to that kind of evidence).
“Good cause” was required to be shown.
The trial judge was vested with “equitable power” to protect parties and witnesses from disclosures which could cause “annoyance, embarrassment, or oppression.”
¶ 11 In
Cox v. Theus
this court was called upon to examine the provisions of 12 O.S. 1971 § 548 with a view to determining if “good cause” could be shown to support the plaintiff’s quest — made at the
pretrial
stage — for production of financial records to be used in support of the petition’s plea for punitive damages.
Punitive (exemplary) damages were then governed by the provisions of 23 O.S. 1971 § 9, originally enacted in 1910.
That one-sentence section authorized “damages for the sake of example” when a tort defendant “was found guilty” of “oppression, fraud, or malice.”
The 1910 antecedent of 23 O.S.1971 § 9
neither
set a stage for special proceedings
nor
required the defendant’s “financial condition” to play a role in the punitive award’s assessment.
¶ 12 Because in
Cox
the discovery was sought at the
pretrial stage
on
mere allegations
in plaintiffs pleading, it was declared unsupported by “good cause” and subject to denial as premature.
Only after
evidence
adduced
at trial
would provide the basis for punitive damages’
submission
could plaintiff compel defendant’s disclosure of relevant financial documents.
¶ 13 In short,
Cox
singled out the discovery of one’s personal financial records as a
protected class
and pronounced it
exempt
from the ordinary pretrial disclosure process. There, the court concluded that no “good cause” was shown — in the § 548 sense — to compel the
pretrial
disclosure sought.
The version of 23 O.S.1971 § 9 then in force tended to accord with the
Cox
view.
Financial worth was not yet statutorily identified as an element of proof in exemplary-damages
proceedings.
¶ 14 The Oklahoma Discovery Code, 12 O.S.1991 §§ 3226
et seq.,
was enacted in 1982. Its provisions
replaced
the earlier § 548. The text of § 3226(B)(1) introduced a broader discovery scope.
Its language did
not
cast the “good cause” requirement upon the party
seeking
discovery, but allowed disclosure demands to be “otherwise limited by order of the court in accordance with the Oklahoma Discovery Code.”
¶ 15 Discovery limitations are found in subsection (C) of 12 O.S.1991 § 3226.
That
provision
shifts the burden
of showing “good cause” to the party who
opposes
discovery.
Just as it was the case.under 12 O.S.1971 § 548, so under the Code the trial judge may consider whether the discovery sought would cause “annoyance, embarrassment, or oppression.” In order to prevent unauthorized disclosure from taking place, a
protective order
may be granted, which could
limit
or
disallow
the discovery, or place some documents under seal, “to be opened as directed by the court.”
¶ 16 The 1910 version of 28 O.S.1971 § 9 (which originally governed exemplary damages) underwent yet another revision in 1986 when it was replaced by 23 O.S.Supp.1986 § 9(A).
The 1986 scheme required a mid-trial
judicial determination,
to be effected at the conclusion of the plaintiffs case in chief, that there was sufficient evidence for the jury to consider an exemplary damages award in excess of actual damages.
The 1986 text was repealed and replaced in 1995 by the provisions of 23 O.S.Supp.1995 § 9.1. The' latter language is presently in force.
Under the new procedure the jury is now specifically authorized to consider in its deliberations the
financial condition of the de
fendant.
The 1995 version requires a
two-phase
trial process (the second of which is statutorily referred to as a “separate proceeding”), which calls for a
particularized verdict finding
that the evidence meets the standards for an exemplary-damages award.
¶ 17 The after-enacted provisions of the Discovery Code, coupled with the new punitive-damages submission regime, clearly call for our re-examination of
Cox.
The Discovery Code gives no support for setting apart the process of discovery for exemplary-damages proof as a separate disclosure rubric.
All
discovery must be filtered through the procedure established by 12 O.S.1991
§ 3226(C), which would allow, upon “good cause,” a
protective order
if sensitive material is sought to be produced.
The new submission procedure for exemplary damages clearly
authorizes
(1) a “separate” trial stage for the jury consideration of that award and (2) submission of financial-worth proof for assessing the amount of that award.
It neither declares nor authorizes any form of interim moratorium on compelled pretrial production of financial records.
¶ 18 Neither in the Discovery Code
nor
in the present text of 23 O.S.Supp.1995 § 9.1 did the legislature craft a separate procedural regime for compelled disclosure of information needed in the punitive-damages stage.
Pretrial
discovery of a defendant’s financial condition serves to protect the uninterrupted continuity of the trial process and a smooth transition into the punitive-damages stage. Objections to production of private financial documents may be made under the terms of 12 O.S.1991 § ■ 3226(C) to protect the defendant’s legitimate claims to privacy. Once an objection is interposed, equitable powers should be exercised to decide whether (a) discovery is warranted and (b) if so, whether a protective order is one’s due.
¶ 19 III.
PRESENT STATUTORY REGIME THAT GOVERNS DISCOVERY AND RECENT ENACTMENTS DEALING WITH PRETRIAL DISCLOSURE OF A DEFENDANT’S FINANCIAL CONDITION SOUGHT IN SUPPORT OF PLAINTIFF’S PLEA FOR EXEMPLARY DAMAGES CAN BE HARMONIZED TO PROTECT A DEFENDANT’S RIGHT OF PRIVACY WITHOUT RIGIDLY INTERPOSING UNDUE DELAY IN THE TRIAL PROCESS.
¶20 This court’s original jurisdiction affords litigants an available remedy for resisting impermissibly compelled pretrial discovery.
An appeal may not always be adequate to protect a party’s quest for withholding privileged or confidential information. Once released at nisi prius, the materials sought to be shielded would no longer receive the law’s palladium.
If this were to occur, waiting to press one’s grievance by the ordinary remedy of appeal would invariably reduce a lively controversy to but an abstract issue and call for relief that would be patently both worthless and ineffective.
¶ 21
Pre-Code
jurisprudence viewed proof of a defendant’s financial condition to be the subject of legitimate discovery inquest
only
after the plaintiffs
evidence
was judicially found sufficient for submission of the punitive-damages plea to the trier.
A mere
allegation
in the pleading did not make a defendant’s financial records vulnerable to disclosure.
As for the production of income tax records, jurisprudence allowed their mid-trial discovery, but cautioned the nisi prius bench to limit a party’s examination of tax returns, even when personal income was in contest, to the issues relevant to the case.
Once the trial had begun, and the court had cleared punitive damages for submission to the trier, disclosure of financial information became compellable at midtrial.
¶ 22 Since the repeal of 12 O.S.1971 § 648 and the enactment of the Discovery Code,
the litigant who
seeks
the production
of documents is no longer required to show “good cause” for their demand. Because the new statutory regime
shifts
the “good cause” burden to the party who
opposes
discovery, it is the latter litigant who bears the responsibility to establish an impermissible invasion of privacy or “annoyance, embarrassment, oppression, or undue burden or expense.”
In camera inspection with a protective order should be sought if discovery material is to be withheld in whole or in part or be merely shielded from public view.*
¶ 23 The provisions of 12 O.S.1991 § 3226(C) — which allow for protective orders — can easily be harmonized with those of the current 23 O.S.Supp.1995 § 9.1. The latter
expressly authorizes
the financial condition of a defendant to be inquired into for assessment of the award that is sought at the punitive-damages stage.
¶24 A plaintiffs
pretrial
quest for financial information from the defendant (to be used in a § 9.1 punitive-damages phase of the trial) should be decided in a § 3226(C) adversary hearing that is to consider the opposing litigant’s quest for protection. The plaintiffs right to prepare for trial and to avoid delay in the evidentiary process should be
balanced
against the defendant’s legitimate claim to privacy.
An
in camera
inspection of the documents sought to be withheld from discovery or from public disclosure is the preferred way to protect the interests of both parties.
IV.
SUMMARY
¶ 25 Statutory changes effected by the provisions of 23 O.S.1995 Supp.1995
§ 9.1
and those introduced by the Oklahoma Discovery Code, 12 O.S.1991 § 3226(B)(1) as well as by § 3226(C),
call for today’s re-examination of
Cox.
Section 3226(B)(1) of the Code allows
pretrial
discovery of unprivileged material relevant to the issues in the case. Section 9.1
explicitly
authorizes the
financial condition of the defendant
to be inquired into for introduction in a punitive-damages-assessment phase of trial. A plaintiffs right to discovery, which is not statutorily unlimited, stands subject to judicial supervision.
Upon the adversary’s motion for a protective order under the terms of 12 O.S. § 3226(C), the trial judge
should consider
whether the plaintiffs discovery request is needlessly or excessively intrusive, burdensome, or oppressive.
If so, discovery should be limited, and if need be, it may be disallowed.
In the cases here in contest, the safeguards of § 3226(C) have been invoked (by the employers) to protect the group’s claim to privacy. The respondent judge is hence directed to
re-examine
his extant order for its conformity to the views expressed in today’s opinion in an adversary hearing to be conducted after this pronouncement becomes effective, and upon an
in camera
inspection, if one is sought. Because the court is confident that the respondent will proceed in accordance with the views we express today, it is unnecessary to grant the prerogative writ sought against him.
¶ 26 ORIGINAL JURISDICTION IS ASSUMED; THE TWO CAUSES ARE CONSIDERED AND DISPOSED OF BY A SINGLE OPINION; RESPONDENT JUDGE IS DIRECTED TO CONFORM HIS DISCOVERY ORDER TO THE STANDARDS ARTICULATED IN THIS OPINION AND TO PROCEED FURTHER IN A MANNER CONSISTENT WITH TODAY’S PRONOUNCEMENT.
¶ 27 KAUGER, C.J., SUMMERS, V.C.J., and HODGES, OPALA, ALMA WILSON and WATT, JJ., concur.
LAVENDER and SIMMS, JJ., dissent.
HARGRAVE, J., not participating.