Iowa Ins. Inst. v. Core Grp. of the Iowa Ass'n for Justice

• Decision Date: 12 June 2015
• Docket Number: No. 13–1627.,13–1627.
• Citation: 867 N.W.2d 58
• Parties: IOWA INSURANCE INSTITUTE, Iowa Defense Counsel Association, Iowa Self-Insurers' Association, Property Casualty Insurers Association of America, National Association of Mutual Insurance Companies, and Iowa Association of Business and Industry, Appellants, v. CORE GROUP OF the IOWA ASSOCIATION FOR JUSTICE; Christopher J. Godfrey, Workers' Compensation Commissioner, Division of Workers' Compensation; and The Iowa Department of Workforce Development, Appellees.
• Court: Iowa Supreme Court

867 N.W.2d 58

IOWA INSURANCE INSTITUTE, Iowa Defense Counsel Association, Iowa Self-Insurers' Association, Property Casualty Insurers Association of America, National Association of Mutual Insurance Companies, and Iowa Association of Business and Industry, Appellants

v.CORE GROUP OF the IOWA ASSOCIATION FOR JUSTICE; Christopher J. Godfrey, Workers' Compensation Commissioner, Division of Workers' Compensation; and The Iowa Department of Workforce Development, Appellees.

No. 13–1627.

Supreme Court of Iowa.

June 12, 2015.

Rehearing Denied Aug. 14, 2015.

Joseph A. Happe, Stephen M. Morain, Elizabeth R. Meyer, and Sarah K. Franklin of Davis, Brown, Koehn, Shors & Roberts, P.C., Des Moines, for appellants.

R. Saffin Parrish-Sams of Soldat & Parrish-Sams, PLC, West Des Moines, for appellees.

Opinion

MANSFIELD, Justice.

In this case we are asked to determine whether the workers' compensation commissioner correctly interpreted Iowa Code section 85.27(2) as overriding the work product immunity and therefore requiring the disclosure of surveillance video of any claimant seeking workers' compensation benefits before the claimant is deposed. For the reasons set forth herein, we conclude that section 85.27(2) is limited to health-care-related privileges such as the physician-patient privilege. Section 85.27(2), in other words, does not affect privileges and protections related to the litigation process such as the work product doctrine. Accordingly, we vacate the decision of the court of appeals, reverse the judgment of the district court, and remand this proceeding to the commissioner.

We decline to address a number of follow-on questions related to the work product doctrine in Iowa; our present holding is simply that section 85.27(2) does not affect the work product doctrine and does not give the commissioner authority to require the disclosure of anything that would otherwise be protected as work product.

I. Background Facts and Proceedings.

Under the Iowa Administrative Procedure Act (IAPA), “Any person may petition an agency for a declaratory order as to the applicability to specified circumstances of a statute, rule, or order within the primary jurisdiction of the agency.”Iowa Code § 17A.9(1)(a ) (2011). The Iowa Workers' Compensation Commissioner has adopted a corresponding rule allowing any person to petition the commissioner for a declaratory order. Iowa Admin. Code r. 876—5.1. On April 20, 2012, pursuant to section 17A.9(1)(a ) and rule 876—5.1, the Workers' Compensation Core Group of the Iowa Association for Justice (Core Group)¹ filed a petition for declaratory order with the commissioner. The petition sought a determination whether Iowa Code section 85.27(2)² mandates that employers or insurance carriers defending workers' compensation claims must immediately provide copies of surveillance videos, photographs, and reports concerning the claimant's physical or mental condition upon receiving a properly phrased discovery request.

Core Group asked the commissioner to answer ten related questions:

a) Is Iowa Code § 85.27(2) applicable to surveillance in workers' compensation claims?

b) Pursuant to Iowa Code § 85.27, are all privileges waived with respect to surveillance videos and photographs showing the injured worker?

c) Pursuant to Iowa Code § 85.27, are all privileges waived with respect to surveillance reports concerning the injured worker?

d) Pursuant to Iowa Code § 85.27, are Defendants required to produce surveillance videos, photos, and/or reports when asked for in appropriate discovery requests?

e) Pursuant to Iowa Code § 85.27, are Defendants permitted to withhold surveillance videos, photos, and/or reports until after deposing the injured worker?

f) Pursuant to Iowa Code § 85.27, when are Defendants required to produce surveillance videos, photos and/or reports?

g) Pursuant to Iowa Code § 85.27, if the information is requested in an interrogatory, is there any privilege against or valid objection to identifying the fact that surveillance was performed, the form of surveillance conducted, who performed it, when it was performed, and who has possession of it?

h) Pursuant to Iowa Code § 85.27, if the information is requested in an interrogatory, when must Defendants identify the fact surveillance was performed, the form of surveillance conducted, who performed it, when it was performed, and who has possession of it?

i) In the event that [questions “a” or “b”] are answered “NO,” if Defendants assert a privilege in response to a request for production of surveillance, are they also required to provide a privilege log under Iowa Rule of Civil Procedure 1.503(5) which identifies the fact surveillance was performed, the form of surveillance conducted, who performed it, when it was performed, and who has possession of it?

j) Pursuant to Iowa Code § 85.27, can an injured worker move to compel production of surveillance videos, photos and/or reports, and for appropriate sanctions, under Iowa Rule of Civil Procedure 1.517 ?

Core Group further provided its proposed answers to these questions: Section 85.27(2) applies to surveillance materials; all privileges otherwise justifying withholding of surveillance materials when requested in discovery are waived; and employers or insurance carriers must disclose surveillance materials promptly when requested without first taking the claimant's deposition.

Desiring input from multiple organizations representing various interests in workers' compensation proceedings, the commissioner invited interested parties to intervene. See generally Iowa Code § 17A.9(4) ; Iowa Admin. Code r. 876—5.3. Four professional and trade associations, including the Iowa Insurance Institute, intervened.³

On June 26, the commissioner held a hearing on the petition for declaratory order. At the hearing, Core Group asserted section 85.27(2) applies to surveillance materials because surveillance footage, photographs, and reports are “information ... concerning the employee's physical or mental condition relative to the claim.” See Iowa Code § 85.27(2). In response, the Institute as a threshold matter contended the commissioner should decline to rule on the petition for declaratory order because the issue would be better resolved in a contested case proceeding. The Institute urged that the declaratory order framework might leave out several necessary parties and that Core Group lacked standing to petition for a declaratory order. See Iowa Code § 17A.9(1)(b ) (2) (“[A]n agency shall not issue a declaratory order that would substantially prejudice the rights of a person who would be a necessary party and who does not consent in writing to the determination of the matter by a declaratory order proceeding.”); Iowa Admin. Code r. 876—5.9(1)(2) (providing the commissioner “may refuse to issue a declaratory order” if “[t]he petition does not contain facts sufficient to demonstrate that the petitioner will be aggrieved or adversely affected” if an order is not issued). The Institute further asserted that if the commissioner ruled on the petition, he should conclude section 85.27(2) does not mandate that employers disclose surveillance materials before deposing a claimant.

On October 23, the commissioner ruled on the petition for declaratory order. The commissioner concluded section 85.27(2) applies to surveillance materials and waives the work product privilege except to the extent that requested materials contain “mental impressions, conclusions, opinions, or legal theories of an attorney or other representative of a party concerning the litigation.” See Squealer Feeds v. Pickering, 530 N.W.2d 678, 689 (Iowa 1995) (internal quotation marks omitted), abrogated on other grounds by Wells Dairy, Inc. v. Am. Indus. Refrigeration, Inc., 690 N.W.2d 38, 47–48 (Iowa 2004). He further concluded employers or insurers must produce surveillance materials upon request from a claimant and may not withhold the materials until after deposing the claimant.

The ruling relied on a literal interpretation of the phrase “all information” in rejecting the Institute's assertion that section 85.27(2) refers only to the release of medical records and reports. Additionally, the commissioner acknowledged surveillance materials are used to test a claimant's veracity, but noted “the veracity [being tested] relates to the claimant's physical or mental condition” and is therefore included within section 85.27(2). Finally, the commissioner concluded predeposition disclosure of surveillance materials does not vitiate all impeachment value, stating, “An implausible answer as to why a claimant was shown in surveillance performing certain physical activities will still impeach a claimant's testimony.”

The commissioner's ruling addressed questions (a) through (h) and (j) presented by Core Group and was based entirely on the commissioner's interpretation of Iowa Code section 85.27(2). The commissioner did not reach question (i), the only question that did not involve interpretation of section 85.27(2).

The Institute sought judicial review in the district court. See generally Iowa Code § 17A.19(10) (setting forth grounds on which a district court reviewing agency action may grant relief from that agency action). The district court affirmed the commissioner's ruling in its entirety.

The Institute appealed, and we transferred the case to the court of appeals. The court of appeals likewise affirmed the commissioner's declaratory order, with one member of the panel dissenting. The Institute sought, and we granted, further review.

II. Standard of Review.

We must resolve three questions: (1) whether section 17A.9 prohibited the commissioner from ruling on the petition for declaratory order, (2) whether the commissioner should have declined to issue a ruling for reasons set forth in the agency's rules, and (3) whether the commissioner's interpretation of section 85.27(2) is correct.

Iowa Code section 17A.9(1)(b )(2) states an agency “shall not issue a declaratory order that would...