
    CIRCUIT COURT OF LANCASTER COUNTY
    Shirley L. Pruett, Administrator c.ta., et al. v. Virginia Health Services, Inc., et al.
    August 31, 2005
    Case No. CL03-40
   By Judge Harry T. Taliaferro, III

The defendant Virginia Health Services, Inc. (“VHS”) has filed a motion for a protective order to bar the plaintiff and/or plaintiffs attorney from having ex parte communications with former employees of VHS and current employees who are not a part of the defendant corporation’s “control group.” Upon consideration of the oral arguments of counsel and the briefs submitted by each side, the Court denies in part and grants in part defendant’s motion.

Facts

This is a medical malpractice case. VHS owns, operates, and manages a nursing home in Lancaster County, Virginia. Plaintiffs decedent was a resident of defendant’s nursing home from May 1, 2002, until her death on October 16,2002. While in the nursing home, plaintiffs decedent’s care was provided by nurses, CNAs, and other attendants who were defendant’s employees. Plaintiff alleges that VHS breached the standard of care for nursing homes by not properly training, managing, and supervising its care staff and by failing to provide enough staff to sufficiently care for plaintiffs decedent. Plaintiff’s motion for judgment seeks damages for pain, suffering, and medical expenses caused by defendant’s negligence and for the wrongful death of the plaintiffs decedent.

Analysis

The issue before the Court is the extent of plaintiffs ability to have ex parte contact with persons having a former or present employment relationship with VHS and how such right may be affected by whether such persons are deemed to be within or without the corporate “control group” or may be regarded as the alter ego of the corporation. Such issue involves, on a case by case basis, analysis of the interplay between the rules of discovery and the ethical limitations governing ex parte contact with the opposing party and with persons represented by counsel. There is no controlling precedent in Virginia on this issue.

Defendant relies upon DuPont v. Winchester Medical Center, 34 Va. Cir. 105 (1994), and Armsey v. MedShares Management Services, Inc., 184 F.R.D. 569 (1998). These cases contain analysis of the Virginia Code of Professional Responsibility (particularly former D.R. 7-103(A)(l)), Virginia Legal Ethics Opinions (including LEO No. 1670), the ABA Model Rules of Professional Conduct and the comments therein, and Part Four of the Rules of the Supreme Court of Virginia (particularly Rule 4:l(c)).

DuPont was a medical malpractice suit alleging that a hospital and a treating physician negligently left surgical sponges inside the plaintiff. Hospital nurses were charged with failure to remove the sponges. Plaintiffs counsel sought ex parte contact with the nurses who were current employees of the hospital. The hospital instructed its nurses not to speak with the plaintiff. The Winchester Circuit Court granted the hospital’s protective order prohibiting the plaintiff from having ex parte contact with the nurses who attended the physician and who may have negligently placed the sponges.

There were specific facts cited by the court in DuPont as the reason for denying ex parte contact. The plaintiff made her motion in the “11th hour” after the cutoff of discoveiy arguing an imperative need to have ex parte contact. The nurses were caught in the middle. Citing their protection, the court ruled out all ex parte contact with the nurses regarding any issue of liability relating to the sponges, while finding that ex parte communication was not improper if plaintiff’s counsel limited inquiry with the nurses to subject matter not relating to the negligent acts alleged in the suit.

The DuPont court in considering conflicting lines of analysis regarding ex parte contact correctly noted that the rules of discovery and rules of ethics are not coterminous. It considered UpJohn v. United States, 449 U.S. 383, 66 L. Ed. 2d 584, 101 S. Ct. 677 (1981)(any employee who might bind the corporation by their acts or admissions only to be contacted by the opposing side through formal discovery), and a string of non-binding LEOs (all but one of which were after Upjohn) all opining it permissible for an attorney to directly contact and communicate with employees of an adverse party provided that the employees were not members of the corporation’s “control group” and were not able to commit the corporation to specific courses of action that would lead one to believe the employee is the corporation’s alter ego.

DR 7-103(A)(1) in effect at the time DuPont was decided is substantially similar to Virginia’s current RPC 4.2 adopted in 2000. Citing this similarity, DuPont utilized an official comment to ABA Model Rule 4.2 to interpret DR 7-103(A)(1). The comment, set out in DuPont, is as follows:

In the case of an organization, this rule prohibits communications by a lawyer for one party concerning the matter in representation with persons having a managerial responsibility on behalf of the corporation, and with any other person whose act or omission in connection with that matter may be imputed to the organization for purposes of civil or criminal liability or whose statement may constitute an admission on the part of the organization.

DuPont considered the nurse employees who acted on behalf of the corporation as not functionally different from “control group” employees who have authority to make binding decisions on behalf of the corporation. DuPont approved reasoning from Queensberry v. Norfolk & Western Ry., Civil Action No. 3:93CV163 (E.D. Va. 1963), finding that corporate employees who are alleged to act negligently or who can make binding corporate decisions are all acting as the corporation and are in essence its alter ego. DuPont’s conclusion was that, since a corporation can only act through its “surrogates,” it should not have less protection than a natural person; therefore, the better rule was the above cited comment to ABA Model Rule 4.2. When Virginia adopted its Rules of Professional Conduct in 2000, the comment cited in DuPont was not included.

While DuPont dealt exclusively with current corporate employees, Armsey involved only former employees. Plaintiffs counsel desired ex parte contact with the defendant corporation’s (1) former in-house counsel, (2) former vice president of managed care, and (3) three former non-management employees.

The corporate defendant in Armsey sought to block ex parte contact with former management employees because they were part of the “control group” and with non-management employees because the plaintiff admittedly was seeking employee statements to offer at trial as corporate admissions. While it considered both DR 7-103 (A)(1) and Model Rule 4.2, Armsey noted that federal courts would look to federal law to interpret and apply Virginia’s rules of ethics. The opinion discussed the split of opinion among different courts regarding what constituted permissible ex parte contact with opposing party corporate personnel:

Some courts hold ex parte contact with former employees to be permissible on the ground that former employees could no longer speak for the corporation and, therefore, what they told opposing counsel could not be used as vicarious admissions of the corporation.
Other courts hold that ex parte communication with former employees is prohibited because such employees’ present statements to opposing counsel of acts or omissions done in the course of their former employment could be imputed as corporation admissions.
Still other courts used a position analysis to hold that former managerial (“control group”) employees could not be contacted ex parte by opposing counsel.

Armsey addressed the ethical policy rationale behind prohibited ex parte contact including the “retained . . . interest” of a represented corporate party from having opposing counsel obtain “uncounselled” or “unwise” statements from former employees which could affect the corporation’s potential liability. The Court found that plaintiff’s counsel desired ex parte contact with former employees in order to impute their knowledge, actions or statements to their former corporate employer.

Non-binding Virginia LEO 1670 (1996) opined that restrictions on ex parte contact cease to exist for a former employee because former employees can no longer speak for or bind the corporation by their acts or omissions. LEO 1670 noted, however, that different conclusions could be reached in different cases based on the facts. Armsey concurred that former employees cannot bind their former corporate employer by their current statements, but noted they could cause liability to be imputed to the employer based on statements, acts, or omissions which occurred during the course of their employment. Armsey thus held plaintiffs counsel could not have ex parte contact with former employees concerning the subject matter of their actions which occurred during their employment at the time of the event allegedly giving rise to the plaintiffs claim of liability.

Under the particular facts in our case, we do not find plaintiffs counsel’s action occurring in the eleventh hour after the expiration of the deadline for discovery. The case is currently set for trial on March 28, 2006. The plaintiff proposes ex parte contact with former control group and non-control group employees (the group in Armsey) and currently employed nurses, CNAs, and care providers (the group in DuPont), who are not control group employees. When Virginia adopted RPC 4.2 it excluded the Model Rule 4.2 comment relied upon in DuPont. RPC 4.2 contains no comment which would red flag an ethical bar to plaintiffs counsel’s ex parte contact with any former or current employees of VHS other than current “control group” employees or persons fitting the alter ego analysis.

Concern exists about preserving the confidentiality of any attorney-client privilege particularly where the person who is contacted ex parte has retained personal counsel.

Comment 4 to RPC 4.2 suggests the adoption of the primaiy logic employed in LEO 1670. It would prohibit ex parte communications with persons in VHS’s “control group” defined as “any employee of an organization who, because of their status or position, have the authority to bind the corporation.” We find such persons to be managerial employees, not floor nurses, CNAs, or other direct care providers

Comment 4 to RPC 4.2, however, also would prohibit ex parte contact with persons who may be regarded as the “alter ego” of the corporation. Such persons may be those who act on behalf of the corporation performing the work to which they are assigned. The rationale is that only through such “hands on” interaction with residents of the nursing home does the corporation carry out its purposes. Like in DuPont, VMS’s current employees are in the middle. They are answerable within the scope of their employment to their employer. By contrast, former employees are not answerable to the corporation and, thus, are not under its control or authority.

Plaintiffs counsel stated to the Court he was passionate about fighting neglect and abuse of residents by nursing homes charged with their care. As Mr. Turner put it, they are killing people and making a lot of money doing it. It is harmless to say this to the Court in a motion hearing because we disregard the comment in our considerations. If stated to a jury, a motion for a mistrial would be a virtual certainty. Such statement to a current employee is unnerving.

We do not diminish the role of civil litigation in correcting societal wrongs. This effect normally occurs, however, after a verdict not during the course of litigation. We shrink not one inch from a lawyer’s ethical responsibility to zealously represent his client. Political causes have their place, but, in the Lancaster County Circuit Court, we deal with one resident against one nursing home. As this Court sees it, plaintiffs counsel’s ex parte contact with currently employed nurses, CNAs, and care giving employees creates significant potential for disrupting the current operation of the defendant’s facility. With respect to current employees, we believe a more controlled process of discovery under the rules of court would better serve the administration of justice in this case.

Conclusion

Courts have great flexibility in entering protective orders under Virginia Supreme Court Rule 4:1 (c). Subject to the conditions stated below, defendant’s motion is denied insofar as it seeks to bar ex parte contact with: (1) former “control group” employees. (No longer employed by VHS.) (2) former non control group employees. (No longer employed by VHS.)

Also, subject to the conditions stated below, defendant’s motion is granted insofar as it seeks to bar ex parte contact with: (3) current “control group” employees of VHS. (Presently employed by VHS.) (4) current non “control group” employees who provide resident care. (Presently employed by VHS.)

Plaintiffs counsel may, however, have ex parte contact with those employees identified in (3) and (4) above on matters which do not relate to the acts or omissions alleged to have caused injury, damage, or death to plaintiff’s decedent.

Plaintiffs counsel may not contact any current or former employee of defendant who has retained independent counsel with respect to the matters in issue in this suit without first obtaining such counsel’s consent to speak with his or her client.

In contacting any former employee identified in paragraphs (1) and (2) above, plaintiff’s counsel must first advise any such person that he represents a party suing VHS, determine whether such former employee is represented by independent counsel, and, if so, obtain consent of such counsel before talking to the former employee, and advise such person that he or she is not his client. Plaintiffs counsel shall not give advice to such persons, except to advise that they may wish to obtain a lawyer.

Mr. Pace shall draft a protective order pursuant to Rule 4:1(c) in accordance with the ruling as expressed in this letter. 
      
       A modified version of the ABA Model Rules and comments entitled “Virginia Rules of Professional Conduct” (“RPC”) was adopted effective January 1, 2000, replacing the Virginia Code of Professional Responsibility.
     
      
       This similarity to the then ABA Model Rule 4.2 was noted in the DuPont case. The “Virginia Code Comparison” comment under Virginia’s RPC 4.2 also notes the two rules are “substantially the same.”
     
      
      
        See Comment [4] of RPC 4.2 “the prohibition [against ex parte contact] does not apply to former employees... of the [corporation], and an attorney may communicate ex parte with such former employee... even if he or she was a member of the [corporation’s] “control group.”
     