Allina Health System v. County of Washington, 82-CV-19-905

CourtTax Court of Minnesota
Writing for the CourtJane N. Bowman, Judge
PartiesAllina Health System d/b/a Abbott Northwestern Hospital, Petitioner, v. County of Washington, Respondent.
Decision Date03 May 2021
Docket Number82-CV-19-905

Allina Health System d/b/a Abbott Northwestern Hospital, Petitioner,

County of Washington, Respondent.

No. 82-CV-19-905

Tax Court of Minnesota, Regular Division, Washington County

May 3, 2021


This matter came on for hearing before the Honorable Jane N. Bowman, Judge of the Minnesota Tax Court, on respondent Washington County's motion to compel discovery.

Nicholas A. Furia, Law Offices of Nicholas A. Furia, PLLC, represents petitioner Allina Health System d/b/a Abbott Northwestern Hospital.

Stuart V. Campbell, Assistant County Attorney, represents respondent Washington County.

Washington County moves this court to compel discovery. Allina largely opposes the motion as unwarranted and unnecessary. The court, upon all the files, records, and proceedings herein, now makes the following:


1. Respondent's motion to compel is granted, in part, and denied, in part.

a. Petitioner shall disclose its general ledger, if any within seven days
b. Petitioner shall disclose pricing studies, if any, within seven days
c. Respondent's motion to compel is otherwise denied



Jane N. Bowman, Judge

I. Background

Allina timely filed a property tax petition claiming-in part-that its Stillwater facility was exempt from property tax in 2018 as a public hospital and a purely public charity as defined in Article X, section 1, of the Minnesota Constitution and Minnesota Statutes section 272.02.[2] The court subsequently filed a Scheduling Order setting forth deadlines in this matter, including a January 19, 2021 deadline by which all discovery was to be complete.[3] The Scheduling Order also contained a provision noting that extensions of deadlines would not be granted absent written motion and a showing of good cause.[4]

On November 13, 2020, Washington County served its first set of discovery on Allina, including interrogatories, requests for admissions, and requests for the production of documents.[5] The County's discovery sought information concerning the subject property's value and classification, among other issues.[6] Allina responded to the County's discovery by December 14, 2020.[7] On December 28, 2020, the County sent Allina a letter (1) outlining perceived deficiencies in Allina's responses, and (2) specifically requesting further responses to Document Requests 5 and 10-15, including the production of some e-mails (further discussed below).[8]

On December 22, 2020, Washington County served its second set of discovery on Allina, [9]which the County believes covered outstanding discovery responses.[10] The County's second set of discovery sought specific information, including e-mails, about petitioner's pricing for services and services that were provided for free, among other issues.[11] To date, Allina has not responded to the County's second set of discovery, maintaining it was untimely served.[12]

The parties argued their respective positions at a February 2, 2021 hearing.[13] The County subsequently narrowed the scope of the e-mail discovery it sought, now requesting e-mails "relating to charity care, sliding scale services, and Exhibits 31 and 33 in" the subject property's prior year's case.[14]

II. Analysis

The County moves for an order compelling responses from Allina stemming from two sets of discovery.[15] Parties may obtain discovery by methods including written interrogatories and requests for production of documents. Minn. R. Civ. P. 26.02(a).[16] Rule 26.02 governs the scope and limits of discovery and provides in part as follows:

Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Information within this scope of discovery need not be admissible in evidence to be discoverable.

Minn. R. Civ. P. 26.02(b).

The frequency or extent of use of the foregoing discovery methods "shall be limited by the court" upon a determination "the burden of proposed discovery is outside the scope permitted by Rule 26.02(b)." Minn. R. Civ. P. 26.02(b)(3)(iii). This court generally allows broad discovery, so long as that discovery is likely to lead to admissible evidence. Ford Motor Co. v. Cnty. of Ramsey, No. 62-CV-08-3719 et al., 2012 WL 3870322, at *1 (Minn. T.C. Sept. 4, 2012) (citing standard pursuant to Minn. R. Civ. P. 26.02). A party seeking discovery may move for an order compelling an answer or production. Minn. R. Civ. P. 37.01(b)(2).

A. Washington County's November 13, 2020 Discovery

Washington County seeks documents responsive to Document Requests 5 and 10-14.[17] Grouped in a logical manner, the requests are discussed below.

1. Document Requests 5, 10, & 11

With Document Request 5, the County asked for: "Any and all documents evidencing income and operating expenses of the subject property for the three years immediately preceding the assessment year at issue in this proceeding." [18] Similarly, Document Request 10, asked for: "All documents relating to profits obtained at the subject property from the last three years, including the disposition of such profits." [19] Finally, Document Request 11 sought: "All documents relating to donations, gifts, [or] government grants received by Petitioner for the subject property." [20]

In response to Document Request 5, Allina noted its property is not "income-producing," but has disclosed its annual total operating expenses, income statements for the operations at the subject property, financial statements prepared by a third party, and Allina's Federal Form 990 (Return of Organization Exempt from Income Tax).[21] At the hearing, the County argued it was still entitled to: (1) all e-mails concerning income and operating expenses for the subject property; (2) a general ledger; and (3) "other financial documents" Allina uses to track and analyze income and operation expenses.[22] After the hearing, the County narrowed its request so as to include only e-mails "relating to charity care, sliding scale services, and Exhibits 31 and 33 in" the subject...

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