VIRTUAL IMAGING SVCS INC

v.

UNITED AUTO INS CO

GAN SCOLA and CUETO, JJ.

PER CURIAM

Respondent United Automobile In T\...n.14.I._.- ..., TTI_,J___fiI I'Cl.].U.UJ.1U1 V ll l.Ll surance Co a¹ Imaging °“""’- about th ' ' the General Counsel of United mpany (United Auto) submitted inte ..._., T__.._ /1TL..¢...,-.1 T.-..,-....I...I...,..\ -PA DUI Vlbfib, 111w. \ V 11 LLld.¹ 1111451111115) LU e reimbursement amounts received contracts as well rrogatories¹' purposes "‘ ' from insur ' as uninsured ' Codes 7 to U¹ obtaining infonnation ance carriers pursuant to established patlents as payment for medical ' 2125/72 1 3 l . managed care services performed pursuant to CPT

THE

CUIT, D ml as ‘=8 M 8‘:lE\;'—\l:‘: ®5Qr3‘§}}§, sea \ [*2] lI I l Without benefit of an in camera inspection, the lower court rendered an order requiring Petitioner Virtual Imagining to: . . . provide the reimbursement amotmts for CPT Codes 72125 & 72131 for only the year of service, YEAR 2010, for each insurance provider/carrier listed . . . and the uninsured and to avoid the potential for disclosure of any trade secret or proprietary information, Plaintiff may simply identify said insurance provider by number and type of carrier, i.e., HMO#l Ireimbursement amount]: HMO #2_; PPO#l_, PPO#2, etc. (underlining in original). An appeal via a petition for writ ofoertiorari followed. Review by certiorari is appropriate when a discovery order departs from the essential requirements of the law, causing material injury to a petitioner throughout the remainder ofthe proceedings below, effectively leaving no adequate remedy on appeal. Allstate Insurance Company v. Langston, 655 So. 2d 91, 94 (Fla. 1995); see Martin — Johnson v. Savage, 509 So. 2d 1097, 1100 (Fla. 1987); Sheridan Healthcorp et. al v. Total Health Choice, Ina, 770 So. 2d 221, 222 (Fla. 3d DCA 2000). Even though some discovery orders rendered by the court may provide confidentiality limitations, they are still subject to certiorari review if they improperly require the disclosure of trade secrets. Cooper Tire & Rubber Company v. Cabrera, 112 So. 3d 731, 733 (Fla 3d DCA 2013). A A + . . . . . . . . . ALI; the hearing below , Petitioner Virtual Imaging argued, and in doing so, 0b_}6Ci€f.i to being forced to disclose information requested pursuant to interrogatory 3. It was Petitioner’s position that disclosure of the information would require disclosure of confidential business information that included confidential contract provisions that “prohibited not only the dissemination of the contracts, but also the disclosure of the terms of said contracts, including the rates included there_in”_.% (underlining and bold in the original). Therefore, itis managed care contracts that it has negotiated with a number ofI-In/IOs and PPOs and the information contained within them are proprietary in nature, and as such should be defined as business trade secrets pursuant to section 688.002(4)(a) of Florida Statutes. Since it was Petitioner Virtual Imaging’s position that its managed care contracts and their contents are trade secrets, Petitioner also argued that the trade secret privilege provided by section 90.506 of the Florida Statutes protects it or anyone they may be in association with from having to disclose the contracts or their contents pursuant to discovery requests. The hearing was convened on May 12, 2014. 2 Petition Brief, p. 6. l [*3] I I In addition, Petitioner Virtual Imaging also argued that the lower court was required to perfonn an in camera inspection to determine:¹) whether the requested HMO and PPO managed care contracts and/or the information contained within them should be classified as trade secrets under section 688.002(4)(a); and, 2) whether the trade secret privilege provided by section 90.506 protects its refusal to disclose and/or prevents other individuals from disclosing the HMO and PPO contracts and/or the information contained within them. 3 Section 688.002(4)(a)(b)4 of the Florida Statutes (2014) defines a trade secret as “ . . . information, including a formula, pattern, compilation, program, device, method, technique, or process that: (a) Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and (b) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy”. After reviewing the language of section 688.002(4)(a), this Court finds that Petitioner’s arguments have merit. Petitioner Virtual Imaging’s managed care contracts which it entered into with a number of HMOs and PPOs as well as the information contained Within them can be defined as a trade secret(s) given the fact that Petitioner’s negotiated contract(s) contains information from which Petitioner derives l)0lI'1 actual and potential economic value in a manner possibly not generally known by other individuals. Furthermore, knowledge of the terms of the contract could allow other individuals to obtain economic value from the disclosure of the information without having to go through the negotiating process, thus reaping the benefits of Petitioner Virtual Imagining’s economic bargain Without having to make any pecuniary sacrifice. This Appellate Court is also aware that a number of other Florida Courts have determined that inforniation involving rates ofreimbursement pursuant to managed care contracts is sensitive in nature and should be considered business trade secrets. The Second District Court in Laser Spine Inst. v. Makanast, determined that doctunents pertaining to billing and collection practices can involve trade secrets. 69 So. 3d 1045, 1046 (Fla. 2d DCA 2011). In Columbia Hospital (Palm Beaches) Limited Partnership v. Hasson, the Fourth District Court accepted and acknowledged the fact that the amount a hospital charges different categories ofpatients for medical treatment is confidential, thus information regarding the method of charging is considered a trade secret. 33 So. 3d 148, 150-151 (Fla 4th DCA 2010). The First District Court ofAppeal in Holmes RegionalMedical Center v. ACHA, reached the conclusion that the managed care contracts and the information contained Within them should 3 Ia’. 4/"rT_'(‘_____'“r\ I F¹ _ 1‘ A ‘1_1'\_|'f"_!4€_____i"l'\_‘__1_f‘1______1_\ (L-'I111UI'II¹ L)€l1Il].l.lUIlb, 1Id.U.C DULIIUL). [*4] ! l \ be considered business trade secrets, even though it would not apply the trade secret privilege because the expert witness disclosed the protected information during a deposition. See generally, 731 So. 2d 51 (Fla. lst DCA 1999). This Appellate Court finds that both existing statutory and case law support Petitioner Virtual lmagjng’s claims that its managed care contracts and the information contained withinthem are proprietary in nature and can be defined as (business) trade secrets pursuant to the language ofsection 688.002(4)(a) ofthe Florida Statutes, and as such, would be entitled to protection pursuant to section 90.506 ofthe Florida Statute. Section 90.5065 ofthe Florida Statutes (2014) states in part that “[A] person has a privilege to refuse to disclose, and to prevent other persons from disclosing, a trade secret owned by that person ifthe allowance ofthe privilege will not conceal fraud or otherwise work injustice”. This Appellate Court notes that the statutory language of section 90.506 expressly provides a trade secret discovery privilege. Therefore, any person or entity that can comply with the requirements ofsection 90.506 has access to the trade secret privilege and can avail itself of the privilege as a defense when refusing to disclose information pursuant to .a discovery request, or in the altemative, prevent other persons from disclosing its trade secret(s) pursuant to a discovery request. Id. As mentioned above, this Appellate Court has taken the position that Petitioner Virtual Imaging’s contracts and/or the information contained within them is proprietary information, and thus can be considered trade secrets as defined under section 688.002. Therefore, it follows that the statutory language in section 90.506 V\iflf\17|:\flflnnf DQ+i+;m-.m- r\ 1fiP\l'\f\-:14\;1¢\fV mm 1-ta. .3.-.+;1-1.3,-1 +.-\ ‘+1F\13 1F\1flI'\+13fi“;(\\F\ 1A1fir\\'I':r1L\('a 1-“, i-‘A43 +1”-.AQ CIQI1P£\+ 1\1#:Y¹~n¢3r\-zn PJU VI-10 l.,l..lLl.L¹ \.rl.l.l.¹\J1L\.¢1 J.Ll.BLll_L.l15 UCU¹ UV \J11L1L1\.rLL LU L1l.\.r iJ1UL\J\.¢LlU11 1J1\J\‘1\.£\.aL/I. U] l..l.J.\.r L.l.(.l-\.l.\.r D\/\/LUI» 1.111 VLJUEU, attr E-d and thus, can provide Petitioner with a legitimate defense against compliance with lnterrogatory 3. Consequently, this Appellate Court finds that Petitioner Virtual Irnaging’s claim of entitlement to its use of the trade secret privilege under section 90.506 has merit. - Petitioner further contends that it raised its trade secret definition argurnents and its entitlement to the trade secret privilege at the hearing below in an effort to protect itself from having to provide the information required by Interrogatory 3. However, the lower court did not conduct an in camera inspection to determine whether its managed care contracts or the information contained within them, should be defined as trade secrets pursuant to section 688.002(4)(a)(b) , and thus protected by the trade secret privilege provided by section 90.506. Case law states that “[W]hen a party asserts the need for protection against disclosure of a trade secret, the court must fnst determine whether, in fact, the disputed information is a trade secret [which] usually requires the court to conduct an in camera review.” Gab’Coast Surgery Center, Inc. v. Fisher, 107 So. 3d 493, 495 (Fla. 2nd DCA 2013); Salick Health Care, Inc. v. Jerome J Spunberg er. al., 722 So. 2d 944, 946 (Fla. 4th DCA 1998); Rare 5 (Privilege wim respect to trade secrets). [*5] | ‘i I r r i Coin-it Inc. v. L..lE., Ina, 625 So. 2d 1277, 1278-1279 (Fla. 3d DCA 1993); Virtual Imagining Service, Inc. a/a/o Mayra Valdez De La Rosa v. United Automobile Insurance Company, 22 Fla. L. Weekly Supp. 429a, *2 (Fla. 11tl:¹ Cir. Ct. Oct. 3, 2014) ; Virtual Imagining Services, Inc. a/a/o Raul Figuerora v. ‘United Automobile Insurance Company, 22 Fla. L. Weekly Supp. 421a, *2 (Fla. llth Cir. Ct. Sept. 9, 2014) Virtual Imaging Services, Inc. a/a/0 VictorAlvarez v. UnitedAutomobile Insurance Company, 22 Fla. L. Weekly Supp. 184b, *2 (Fla. 11th Cir. Ct. Sept. 9, 2014). Respondent United Auto argues that there was no need for the lower court to conduct an in camera inspection in this instance because it both accepted and acknowledged Petitioner’s trade secret definition arguments and access to the trade secret privilege. lr¹ doing so, the lower court tailored the court order accordingly as required by section 90.506 ofthe Florida Statute - “When the court directs disclosure, it shall take the protective measures that the interests of the holder of the privilege, the interests of the parties, and the furtherance ofjustice require.” This Court finds that the problem with Respondenfs contentions are that review of the order issued below does not clearly and expressly indicate that the lower court actually conducted an analysis, and in doing so, made a definitive decision regarding Petitioner Virtual 1magining’s trade secret and trade privilege defense claims. The Third District Court of Appeal explained in Sheridan Healihcorp er. al. that “[W]hen the trade secret privilege is asserted as the basis for resisting production, the trial court must determine whether the requested production constitutes a trade secret. ” 770 So. 2d at 222, relying on Rare Coin-it, Inc. v. IJE., Inc., 625 So. 2d 1277, 1278 (Fla. 3d DCA 1993); see Cabrera, 112 So. 3d at 734 (on remand the court is instructed to make a determination as to what documents, if any, constitute trade secrets). The district court in Sheridan further stated that “[I]f production is then ordered, the court must set forth its findings”. Sheridan Healthcorp et. al., 770 So. 2d at 222, again relying on Rare Coin~it, Inc., 625 So. 2d at 1278; see Cabrera, 112 So. 3d at 734; Virtual Imagining Service, Inc. a/a/o Mayra Valdez De La Rosa v. United Automobile Insurance Company, 22 Fla. L. Weekly Supp. 429a, at *2; Virtual Imaging Services, Inc. a/a/0 VictorAlvarez v. UnitedAutomobile Insurance Company, 22 Fla. L. Weekly Supp. 184b at *3. This Appellate Court finds that in this instance, the lower court did not specifically state in the order the decision it reached regarding the status of the arguments tendered by Petitioner involving the classification of its contracts as trade secrets and its entitlement to the trade secret privilege defense. While the lower court in this instance may have “implicitly concluded that the trade secret [definition and] privilege applied, an implicit finding does not satisfy the legal criteria for a trade secret analysis. Virtaal Imaging Services, Inc. a/a/o Victor Alvarez v. UnitedAutomobile Lnsnrance Company, 22 Fla. L. Weekly a [*6] l Supp. l84b at *3. This Court acknowledges that the non-final order rendered below was crafted in a manner that directed Petitioner Virtual Imagining not to disclose the identities of the affected insurance companies and uninsured individuals. However, the lower court did not make a clear finding whether information regarding the reimbursement amounts paid by certain insurance companies and uninsured individuals as well as their identities should be considered trade secrets. See Virtual Imaging Services, Inc. a/a/0 Victor Alvarez v. UnitedAutomobile Insurance Company, 22 Fla. L. Weekly Supp. l84b at *2. Therefore, this Appellate Court fmds that the lower court’s failure to conduct an in camera inspection to determine:¹) whether Petitioner Virtual In1agining’s managed care contracts and any information contained within them should be classified as trade secrets pursuant to section 688.002(4) ofthe Florida Statutes; 2) whether the reimbursement amounts paid pursuant to the contracts and by uninsured individuals in this instance should be classified as trade secrets pursuant to section 688.002(4) of the Florida Statutes; 3) whether the identities of the affected insurance companies and uninsured individuals should be classified as trade seerets pursuant to section 688.002(4) of the Florida Statutes; and, 4) whether the trade secret privilege provided by section 90.506 of the Florida Statutes should apply to protect Petitioner from having to reveal the requested information pursuant to Interrogatory 3, was a failure to follow the essential requirements of the law. This failure to follow the essential requirements ofthe law could result in a material injury that would affect the Petitioner throughout the remainder of the proceedings below, effectively leaving Virtual Imagining without an adequate remedy on appeal. Langston, 655 So. 2d at 94.“ Accordingly, this Appellate Court GRANTS the Petition for Writ of Certiorari, thus QUASHING the lower court order directing Petitioner Virtual Imaging to provide information pursuant to lnterrogatory 3 Without benefit ofan in camera inspection.