Fourth DCA Addresses Scope of Trade Secret Discovery

On February 27, 2019, the Fourth District Court of Appeal addressed the scope of trade secret discovery in Lake Worth Surgical Center, Inc. v. Gates, No. 4D18-2774, __ So. 3d __. The plaintiff sued the defendant for damages arising from a traffic accident. The defendant sought discovery from the surgical center where the plaintiff had received treatment. That information included two examples of reimbursement rates that the surgical center had received from insurance carriers for each service provided to the plaintiff (without naming the carriers), the approximate percentage over the prior three years of the surgical center’s practice that constituted treatment of patients involved in personal injury litigation or pre-suit claims, and the amounts collected for services unrelated to the underlying litigation that the surgical center had provided to the plaintiff on two different dates. The Fourth DCA held that internal cost structure information constitutes a trade secret and, therefore, the request for information about insurance reimbursement rates was protected from disclosure. However, the Fourth DCA ruled that the other information requested was not protected trade secret information.

The Gates decision is important in at least two respects. One, it provides a precedent for compelling medical centers, including surgical centers, to disclose the percentage of its business devoted to litigation-related services. Such information is useful in detecting and preventing fraudulent and abusive business practices, especially in the insurance arena. The second is that it reiterates the broad protection that Florida courts continue to provide to cost structure information, and similar internal financial data, especially of non-parties.