Stafford v. New Dairy Texas, LLC

IN THE UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

SHARON STAFFORD, §

§

Plaintiff, §

§

v. § Civil Action No. 3:23-CV-272-N

§

NEW DAIRY TEXAS, LLC, §

§

Defendants. §

MEMORANDUM OPINION AND ORDER

This Order addresses Defendant New Dairy Texas, LLC’s (“New Dairy”) motion

to compel discovery [18], New Dairy’s motion for leave to file confidential transcripts

under seal [36], and Plaintiff Sharon Stafford’s motion to compel [40]. For the foregoing

reasons, the Court grants in part and denies in part New Dairy’s motion to compel, denies

New Dairy’s motion for leave to file, and denies Stafford’s motion to compel.

I. ORIGINS OF THE MOTION

This case arises out of an employment discrimination claim under Title VII of the

Civil Rights Act of 1964 (42 U.S.C. § 2000e et seq. and 42 U.S.C. §1981a), the Age

Discrimination in Employment Act of 1967 (29 U.S.C. § 621), and the Lily Ledbetter Fair

Pay Act of 2009. Pl.’s Pet. ¶¶ 30–32, Ex. B App. 7–8 [2]. Stafford alleges that New Dairy

discriminated against her by intentionally undermining her performance, failing to promote

her, and targeting her for termination. Id. On April 28, 2023, New Dairy served its First

Set of Requests for Production and Interrogatories, to which Plaintiff served Responses on

May 30, 2023. Def.’s Mot. to Compel 2. After New Dairy served its first deficiency letter,

Stafford produced complete audio recordings and transcripts of conversations Stafford

recorded during her employment with New Dairy. Id. After reviewing the recordings and

transcripts, New Dairy requested that Stafford designate the recordings and transcripts with

“CONFIDENTIAL INFORMATION – SUBJECT TO PROTECTIVE ORDER” pursuant

to the Court’s Protective Order [8]. Id. at 3. New Dairy alleges that weaved throughout

the recordings are conversations about New Dairy’s confidential business strategies,

employee compensations, and ethics reports, and other private matters. Furthermore, New

Dairy insists on a global confidentiality designation due to the difficulty in designating the

recordings and transcripts as partially confidential. Id. Stafford refused the global

designation and insisted that only portions of the recordings and transcripts should be

designated as confidential. Id. After a second deficiency letter from New Dairy and

Stafford’s supplemental responses and productions, the Parties still dispute the production

of three separate authorizations for: (1) Employment Records, (2) Protected Health

Information, (3) Psychotherapy Notes. Id. The Parties continue to disagree on the proper

designation of the recordings and transcripts. New Dairy filed the motion to compel to

resolve these outstanding discovery disputes.

As part of its motion to compel, New Dairy asked the Court to “designate [the]

documents and recordings ‘Confidential Information – Subject to Protective Order’” while

the Court considered New Dairy’s request for global designation so that New Dairy may

file the materials under seal. Id. at 9 n. 5. The Court granted New Dairy’s request and

ordered New Dairy to file the transcripts under seal while the Court considers the motion.

See Order (Feb. 7, 2024) [32]. Subsequently, New Dairy filed a motion for leave to file

the transcripts under seal. See Def.’s Mot. for Leave. Stafford opposed the motion,

objecting to the “unauthenticated transcripts.” See Pl.’s Resp. to Def’s Mot. for Leave [38].

Additionally, Stafford filed a motion to compel requesting the Court to order New Dairy

to comply with requests for production of documents concerning Stafford and all other

requested HR personnel member files as well as the complete personnel file of Ray Gibson.

See Pl.’s Mot. to Compel [40]. The Court now turns to each discovery motion.

II. LEGAL STANDARD FOR DISCOVERY

Federal Rule of Civil Procedure 26 allows parties to “obtain discovery regarding

any nonprivileged matter that is relevant to any party’s claim or defense and proportional

to the needs of the case.” FED. R. CIV. P. 26(b)(1). A litigant may request the production

of documents falling “within the scope of Rule 26(b)” from another party if the documents

are in that party’s “possession, custody, or control.” FED. R. CIV. P. 34(a). To enforce

discovery rights, a “party seeking discovery may move for an order compelling an answer,

designation, production, or inspection.” FED. R. CIV. P. 37(a)(3). The Fifth Circuit requires

the party seeking to prevent discovery to specify why the discovery is not relevant or show

that it fails the proportionality requirement. McLeod, Alexander, Powel & Apffel, P.C. v.

Quarles, 894 F.2d 1482, 1485 (5th Cir. 1990); see also Merrill v. Waffle House, Inc., 227

F.R.D. 475, 476 (N.D. Tex. 2005).

Courts construe relevance broadly, as a document need not, by itself, prove or

disprove a claim or defense or have strong probative force to be relevant. Samsung Elecs.

America Inc. v. Chung, 321 F.R.D. 250, 280 (N.D. Tex. 2017). A district court has wide

discretion to supervise discovery, however, and may limit discovery if it would be

unreasonably cumulative, could be obtained more easily from a different source, is not

proportional to the needs of the case, or if the burden or expense of proposed discovery

outweighs its potential benefit. FED. R. CIV. P. 26(b)(2)(C); Landry v. Air Line Pilots Ass’n

Int’l AFL-CIO, 901 F.2d 404, 436 n.114 (5th Cir. 1990).

III. THE COURT GRANTS IN PART AND DENIES IN PART NEW DAIRY’S

MOTION TO COMPEL THE SIGNED AUTHORIZATIONS

New Dairy asks the Court to order that Stafford produce three separate signed

authorizations: (1) Authorization For Release of Scholastic Records, (2) Authorization For

Disclosure of Protected Health Information, and (3) Authorization For Release of Protected

Health Information Psychotherapy Notes. As an initial matter, a party can compel a signed

authorization under Rule 34. EEOC v. L-3 Commc’ns Integrated Sys., LP, 2018 WL

3548870, at *3 (N.D. Tex. July 24, 2018) (Godbey, J.); see also Coleman v. Cedar Hill

Indep. Sch. Dist., 2022 WL 1470957, at *3 (N.D. Tex. May 10, 2022) (Fitzwater, C.J.)

(affirming this Court’s holding that a court can compel a party to sign an authorization).

Because Stafford can be required to sign the authorizations, the Court now addresses

Stafford’s argument that the scholastic and medical records lack relevance as required by

Rule 26(b).

A. The Scholastic Records Are Relevant

Stafford alleged in her complaint that she was “the most qualified” for the HR

supervisory position. Pl.’s Pet. ¶ 21, Ex. B App. 7. This allegation put her qualifications

at issue, which includes her scholastic records. Scholastic background can be one of many

legitimate, non-discriminatory factors an employer may consider when choosing who to

promote or salary differentials. See Sauceda v. Univ. of Texas at Brownsville, 958 F. Supp.

2d 761, 776 (S.D. Tex. 2013) (“[A]n employer may base a salary differential on a factor

other than sex, including: (1) ‘different job levels;’ (2) ‘different skill levels;’ (3) ‘previous

training;’ (4) ‘experience;’ and (5) ‘prior salary history, performance, and other factors.’”

(quoting EEOC v. TXI Operations, L.P., 394 F.Supp.2d 868, 879 & n. 11 (N.D. Tex.

2005)). Accordingly, the Court finds that the scholastic records are relevant and compels

Stafford to execute the Authorization for Release of Scholastic Records.

B. Stafford’s Personal Health Information Is Relevant in Part

Stafford argues that her medical records are irrelevant because she does not claim a

physical injury in this case; therefore, the Court should not compel her to sign the Proposed

Medical Authorization. Nevertheless, Stafford does seek emotional distress damages in

connection with her discrimination claims, and medical records are discoverable in a

discrimination case where the plaintiff seeks emotional distress damages. See Merrill, 227

F.R.D. at 473-74. Therefore, at least some of Stafford’s medical records are discoverable.

Even so, “[t]he Court recognizes that all medical records, and especially records pertaining

to treatment for purely physical conditions, will not necessarily be relevant to mental

anguish claims.” Id. at 473. Here, New Dairy’s Authorization for Disclosure of Protected

Health Information is not limited in time and asks for “any protected health information

(“PHI”), exclusive of psychotherapy notes, related to [Stafford], including, but not

limited to test results, X-rays, prescriptions, and records of diagnosis, treatment, and

prognosis.” Def.’s Mot. to Compel. Ex. A App. 28 [19] (emphasis in original). The Court

finds this authorization to be overbroad as this authorization would include physical

conditions unrelated to mental anguish claims and finds that the authorization should be

narrowed according to the parameters outlined below.

First, the Court orders New Dairy to narrow the timeline of requested production to

when Stafford started working at New Dairy and treatment following her resignation.

Second, the Court orders New Dairy to narrow the scope of the authorization to records

related to psychiatric or psychological treatment and physical conditions spawning from

any diagnosed psychiatric or psychological illness. Finally, the Court orders Stafford to

execute the Authorization for Disclosure of Protected Health Information after New Dairy

alters its requests in compliance with this Order.

C. Stafford Has Not Waived Her Psychotherapist-Patient Privilege

In a separate authorization, New Dairy asks the Court to compel Stafford to sign an

authorization of protected health information specific to psychotherapy notes. The Court

denies New Dairy’s request. New Dairy defines “psychotherapy notes” to be “notes

recorded (in any medium) by a health care provider, who is a mental health professional,

documenting or analyzing the contents of conversation during a private counseling session

or group, joint, or family counseling session and that are separated from the rest of the

individual’s medical records.” Id. at App. 29.1 Though there is no physician-patient

privilege recognized by federal courts, federal courts do recognize that confidential

communications between a psychotherapist and a patient are privileged. Jaffee v.

1 This authorization is specific to the notes covering the communications between Stafford

and a mental health professional, but the authorization in dispute in Section III.B would

allow New Dairy to receive any records pertaining to an official diagnosis, treatment plan,

etc. Stafford may have received from a mental health professional.

Redmond, 518 U.S. 1, 11 (1996). However, this privilege can be waived. Id. at 15 n.14.

Federal courts across the country adopt several different approaches to determining when

a party waived this privilege, and the Fifth Circuit has yet to clearly establish which

approach should apply. Merrill, 227 F.R.D. at 467; see also Fleming v. Methodist Hosp.,

2023 WL 4307157, at *2 (W.D. Tex. June 30, 2023).

New Dairy asks the Court to adopt the broadest approach to waiver of

psychotherapist-patient privilege recognized in Merrill and find that Stafford waived

psychotherapist-patient privilege by seeking emotional distress damages. See Merrill, 227

F.R.D. at 474 (citing Sarko v. Penn–Del Directory Co., 170 F.R.D. 127 (E.D. Penn. 1997)).

In contrast, Stafford asks the Court to adopt what Merrill defines as a “‘middle approach’

which holds that a mere request for damages for ordinary, garden variety claims of mental

anguish or emotional distress, as opposed to a cause of action based upon emotional

distress, does not place a party’s mental condition at issue, and the privilege is not waived.”

Id. at 475 (citing Ruhlmann v. Ulster Co. Dept. Of Social Serv’s, 194 F.R.D. 445 (N.D.

N.Y. 2000)).

The Court finds the Ruhlmann decision to be informative. The Ruhlmann court

examined the cases espousing the broadest approach to privilege waiver and found that

these cases “distinguish[ed] between cases in which significant emotional harm is alleged

or the mental condition is at the heart of the litigation, and a claim for ‘garden-variety’

emotional distress damages,” declining to apply the broadest approach to “garden-variety”

emotional distress allegations. Ruhlmann, 194 F.R.D. at 449. Emotional harm is not at the

heart of the litigation; therefore, the Court adopts the middle approach — that a garden-

variety request for emotional distress damages does not itself constitute a waiver of

psychotherapist-patient privilege. Accordingly, the Court denies New Dairy’s request to

compel Stafford’s signed Authorization for Release of Protected Health Information

Psychotherapy Notes.

IV. THE COURT DENIES NEW DAIRY’S REQUEST TO GLOBALLY DESIGNATE

AUDIO RECORDINGS AND TRANSCRIPTS AS CONFIDENTIAL

New Dairy requests that the Court globally designate the audio recordings and the

transcripts as confidential subject to protective order. New dairy argues that there are

significant amounts of confidential information throughout the recordings and transcripts

“making it impossible to separate and requiring a global designation as confidential.”

Def.’s Mot. to Compel 10. In response, Stafford argues that New Dairy ignored multiple

requests to identify portions of the recordings that New Dairy believes are confidential.

Pl.’s Resp. Mot. to Compel 9 [20]. New Dairy replied that “[a]lthough it is not required to

do so, New Dairy did provide in its Motion examples of confidential information discussed

in the recordings—COVID business strategies, employee compensation decisions,

confidential ethics reports and other private information involving other employees,

internal presentations, and other private matters.” Def.’s Reply Mot. to Compel 4-5 [22]

(internal quotations omitted). New Dairy’s briefing did not provide the Court with enough

context to determine the pervasiveness of protected information woven throughout the

recordings and transcripts, and “[c]ourts in this Circuit have held that wholesale

confidentiality designation is evidence of bad faith that a party has abused the

confidentiality designation. Ruby Slipper Cafe, LLC v. Belou, 2020 WL 4897905, at *7

(E.D. La. Jan. 8, 2020) (removing the wholesale designation of a deposition as confidential

when the “deposition excerpts at issue contain no information that this Court can properly

consider proprietary or commercially sensitive—the underlying justification for the

blanket protective order”).

To inform its decision the Court granted New Dairy request to give the transcripts

temporary confidentiality status, see Def.’s Mot. to Compel 9 n.5, so the Court can review

of the transcript to determine the need for a wholesale confidentiality designation. See

Order (Feb. 7, 2024). In response New Dairy filed its motion for leave to file confidential

transcripts under seal with the transcripts attached in the appendix and portions highlighted

which New Dairy believes involves confidential information. See Def.’s Mot. for Leave,

App. Supp. [37]. Up on review of the transcripts, the Court denies New Dairy’s request

for a global confidentiality designation and dismisses New Dairy’s motion for leave as

moot. Additionally, the Court orders the Parties to in meet and confer regarding the

portions of the recordings and documents from Stafford’s production that New Dairy

believes require a confidentiality designation.2 For any confidentiality designation for

which the Parties cannot agree, the Court orders New Dairy to resubmit its designation

request, providing an affidavit explaining the rationale for each of the disputed

confidentiality designations and why it falls under the protective order.

2 To the befuddlement of the Court, New Dairy created its own transcripts; even though, it

represented in its motion to compel that Stafford had already produced the recordings and

transcripts. See Def.’s Mot. to Compel 2. The discovery to be discussed when the Parties

meet and confer are the disputed recordings and transcripts that New Dairy represented

that Stafford produced.

V. THE COURT DENIES STAFFORD’S MOTION TO COMPEL

Finally, Stafford asks the Court to compel New Dairy to produce Stafford and all

other requested HR personnel members’ files and the complete personnel file of Ray

Gibson. See Pl.’s Mot. To Compel. New Dairy responded that it produced the requested

personnel files. See Def.’s Resp. Pl.’s Mot. To Compel 6 [41]. In support of its position,

New Dairy provided the email it sent Stafford’s regarding the disputed discovery responses

which stated that “New Dairy is happy to discuss further should [Stafford] choose to state

which documents [she] believe[s] New Dairy has withheld due to an inappropriate

objection,” but Stafford failed to identify the alleged discovery deficiency. Id. at 10.

Stafford provided no reply to New Dairy’s response to her motion to compel. Accordingly,

the Court assumes New Dairy has, in fact, produced all of the documents in dispute in

Stafford’s motion to compel and dismisses Stafford’s motion to compel as moot.

CONCLUSION

The Courts grants in part New Dairy’s motion to compel and orders Stafford to

execute the authorizations for scholastic records and personal health information, narrowed

in scope as the Court instructed. The Court denies New Dairy’s request that the Court

compel the executed authorization for psychotherapy notes. Furthermore, the Court denies

New Dairy’s request to globally designate the recordings and transcripts as confidential.

The Court orders the Parties to meet and confer regarding the portions of the produced

discovery that New Dairy believes requires a confidentiality designation. The Court

likewise denies New Dairy’s motion for leave to file and denies Stafford’s motion to

compel. Finally, the Court finds that, under the circumstances presented, the Parties should

bear their own expenses, including attorney’s fees, in connection with each motion.

Signed June 10, 2024.

| C. Godbey

Chief United States District Judg

MEMORANDUM OPINION AND ORDER — PAGE 11