# State ex rel. Wallace v. State Med. Bd. of Ohio

> Ohio Supreme Court · August 16, 2000 · 89 Ohio St. 3d 431

URL: https://www.frixlaw.com/law-library/cases/11151887

## Case

- **Court:** Ohio Supreme Court
- **Decided:** August 16, 2000
- **Citations:** 89 Ohio St. 3d 431; 2000 Ohio 213
- **Precedential status:** Published
- **Opinion:** Opinion
- **Judges:** Alice Robie Resnick, J.
- **Cited by:** 22 later opinions in the Frix Law Library

## Citator (automated)

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## Opinion text

[This opinion has been published in Ohio Official Reports at 89 Ohio St.3d 431.]

THE STATE EX REL. WALLACE ET AL., APPELLEES, v. STATE MEDICAL BOARD
OF OHIO ET AL., APPELLANTS.

[Cite as State ex rel. Wallace v. State Med. Bd. of Ohio, 2000-Ohio-213.]
Public records—State Medical Board of Ohio’s investigative records are not
public records—Waiver of right to confidentiality—Determining whether
State Department of Insurance fraud investigatory records are exempt
from disclosure under R.C. 149.43(A)(2).
(No. 99-1385—Submitted April 11, 2000—Decided August 16, 2000.)
APPEAL from the Court of Appeals for Hamilton County, No. C-980557.
__________________
{¶ 1} Relator-appellee Alvin Wallace is a surgical assistant and president of
relator-appellee Surgical Skills, Inc., a business that provides hospitals with
surgical assistants. Surgical assistants perform tasks such as preparing and laying
out the necessary surgical instruments.
{¶ 2} In 1994, respondent-appellant State Medical Board of Ohio and
respondent-appellant State Department of Insurance began independent
investigations of the relators.
{¶ 3} On September 7, 1994, Patricia Ellis, an investigator employed by the
Medical Board, began investigating relators for alleged violations of R.C. Chapter
4731, including the unlicensed practice of medicine.
{¶ 4} In January 1995, Richard Wilson, an investigator employed by
Anthem Blue Cross and Blue Shield (“Anthem”), began investigating insurance
claims submitted to Anthem by the relators.
{¶ 5} Also in January 1995, Robert J. Kaising, an investigator with the
Insurance Department, was assigned to investigate a complaint, made by a third-
party payor other than Anthem, that alleged that relators were committing insurance
SUPREME COURT OF OHIO

fraud. In June 1995, Kaising learned that Anthem was also conducting an
investigation of the relators.
{¶ 6} Wilson’s investigation commenced after Anthem received a
communication from the National Health Care Anti-Fraud Association. The
communication was authored by FBI agent Cynthia Cronin and stated that the
relators were suspected of submitting fraudulent claims to insurance companies.
The concern was that the relators, surgical assistants, were using billing codes
employed by the medical profession to bill insurance companies for services
rendered by surgeons.
{¶ 7} The scope of Wilson’s investigation was limited to determining
whether Wallace was a physician and whether services that relators provided to
Anthem subscribers were reimbursable, as Anthem’s administrative guidelines did
not allow services performed by nonphysician surgical assistants to be reimbursed.
In the beginning of April or May 1995, Wilson, believing that he was under a duty
to do so, contacted the Insurance Department to discuss information he had
gathered regarding the relators. At that time, he also contacted the Medical Board.
{¶ 8} During their investigations, Wilson was present on several occasions
when Ellis and Kaising interviewed physicians and when they inquired about
arrangements between the relators and medical providers.
{¶ 9} In December 1995, relators contacted the Medical Board and
Insurance Department and requested permission to inspect and copy all of the
documents these agencies had in their possession relating to Wallace and Surgical
Skills, Inc. These requests were made pursuant to the Public Records Act, R.C.
149.43 et seq. The Medical Board and Insurance Department refused to release
their investigatory records to the relators.
{¶ 10} In May 1996, relators filed a mandamus action in the Hamilton
County Court of Common Pleas to compel the respondents to release their
investigatory records relating to relators under R.C. 149.43. Respondents, the

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January Term, 2000

Medical Board and Insurance Department, claimed that the records were
confidential and exempted from release under R.C. 149.43. On June 3, 1998, the
trial court granted respondents’ motion for summary judgment.
{¶ 11} Relators appealed, asserting five assignments of error. On June 11,
1999, the Court of Appeals for Hamilton County reversed the trial court’s judgment
in part and remanded the case to the trial court for further proceedings in accordance
with its disposition of the case.
{¶ 12} The court of appeals determined that by allowing Wilson to be
present during witness interviews the Medical Board violated the duty to keep its
investigatory records confidential; however, the court concluded, “R.C. 4731.22
provides a privilege for information in the Medical Board’s investigatory records.
Without a valid waiver from all persons whose privacy rights are implicated, these
records may not be disclosed under the Public Records Act.” The court further
noted that Dr. Semertzides, one of the physicians who was interviewed in Wilson’s
presence, authorized the release of all information gathered during his interview.
With regard to this information, the court of appeals directed the trial court to
conduct an in camera inspection and withhold any information that implicated the
privacy rights of anyone other than Semertzides. Additionally, the court of appeals
concluded that the trial court had a duty to conduct an in camera inspection of the
Insurance Department’s records in order to ascertain whether the information
contained therein was exempted from release.
{¶ 13} In addressing relators’ other assignments of error, the court held that
the investigations conducted by the Medical Board and the Insurance Department
were legitimate and therefore not ultra vires and that the denial of records did not
violate Wallace’s equal protection rights.
{¶ 14} The cause is now before this court upon the allowance of a
discretionary appeal.
__________________

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Robert Armand Perez, Sr., for appellees.
Betty D. Montgomery, Attorney General, Scott Myers and Lisa Wu Fate,
Assistant Attorneys General, and Mark R. Weaver, Special Counsel to the Attorney
General, for appellants.
__________________
ALICE ROBIE RESNICK, J.
{¶ 15} This case, which the court of appeals characterized as a “complex
case involving the interplay of the Public Records Act, the confidentiality
provisions of the State Medical Board of Ohio, and similar, but not identical
provisions governing the State Department of Insurance” (footnote omitted), raises
two separate yet interrelated issues for our consideration. First, we must determine
whether the records in question are “public records” within the meaning of R.C.
149.43. If these records are not public records but rather are confidential
investigatory materials, then we must determine whether the presence of a
nonagent, third party during witness interviews constitutes a waiver of
confidentiality in the otherwise privileged material.
I. Confidentiality of Investigatory Records
{¶ 16} Ohio’s Public Records Act is codified in R.C. 149.43 et seq. The
statute defines “[p]ublic record” as “any record that is kept by any public office.”
R.C. 149.43(A)(1). The term “public office” includes “any state agency * * *
established by the laws of this state for the exercise of any function of government.”
R.C. 149.011(A). R.C. 149.43 must be construed liberally in favor of broad access
to records kept by public offices, and any doubt is to be resolved in favor of
disclosure of the records. State ex rel. Gannett Satellite Info. Network, Inc. v. Petro
(1997), 80 Ohio St.3d 261, 264, 685 N.E.2d 1223, 1227, citing State ex rel. Gannett
Satellite Info. Network, Inc. v. Shirey (1997), 78 Ohio St.3d 400, 401, 678 N.E.2d
557, 559. Additionally, mandamus is the appropriate remedy to compel compliance
with R.C. 149.43. R.C. 149.43(C); see, also, State ex rel. Multimedia, Inc. v.

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Snowden (1995), 72 Ohio St.3d 141, 142, 647 N.E.2d 1374, 1377, citing State ex
rel. Steckman v. Jackson (1994), 70 Ohio St.3d 420, 426, 639 N.E.2d 83, 88-89.
With these standards in mind, we now proceed.
A. Medical Board Records
{¶ 17} The Medical Board is a “public office” for the purposes of R.C.
149.43. Former R.C. 4731.22(C)(1), the applicable provision governing Medical
Board investigations, stated, “Information received by the board pursuant to an
investigation shall be confidential and not subject to discovery in any civil action.”
146 Ohio Laws, Part V, 8765. (The current version is codified at R.C.
4731.22[F][5] and is virtually the same.)
{¶ 18} In State Med. Bd. of Ohio v. Murray (1993), 66 Ohio St.3d 527, 536,
613 N.E.2d 636, 642-643, we held that information contained in the Medical
Board’s records “is to be kept confidential at all times and is not, under any
circumstances, * * * discoverable in a civil action.” Based on the plain language
employed in R.C. 4731.22, language that we previously deemed a “clear legislative
directive,” we hold that the Medical Board’s investigative records are not public
records. Id. at 536, 613 N.E.2d at 642.
{¶ 19} R.C. 149.43(A)(1) defines “public record” and enumerates
exceptions from the definition of “public record” for purposes of the Public Records
Act. “Records the release of which is prohibited by state or federal law” are not
public records. R.C. 149.43(A)(1)(q), formerly R.C. 149.43(A)(1)(p), 146 Ohio
Laws, Part I, 134. In enacting former R.C. 4731.22(C)(1), the General Assembly
specifically exempted the Medical Board’s investigative records from disclosure
under R.C. 149.43.
{¶ 20} Having determined that the Medical Board’s investigative records
are not public records within the meaning of R.C. 149.43, we must now determine
whether the Medical Board waived its right to confidentiality by allowing Wilson,
a third party, to attend witness interviews.

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{¶ 21} Former R.C. 4731.22(C)(1) mandated that the board “conduct all
investigations and proceedings in such a manner as to protect patient
confidentiality. The board shall not make public names or other identifying
information about patients unless proper consent is given or a waiver of the patient
privilege exists” under R.C. 2317.02(B). 146 Ohio Laws, Part V, 8766. (This
mandate remains unchanged in the current version of R.C. 4731.22. See R.C.
4731.22[F][5]. Moreover, this current version requires the board to protect
confidentiality not only of patients but also of persons who file complaints with the
board.) This provision contains safeguards designed to protect patient
confidentiality in the same manner that the physician-patient privilege protects
patient confidences. State Med. Bd. of Ohio v. Miller (1989), 44 Ohio St.3d 136,
138, 541 N.E.2d 602, 604. The court of appeals correctly recognized that by
allowing Wilson to attend witness interviews, the Medical Board violated its duty
to maintain the confidentiality in the information it gathered. We agree that it was
improper for the Medical Board to give a private third party access to this
information. Thus, the issue remains whether the Medical Board’s breach of
confidentiality constitutes a waiver.
{¶ 22} One physician, Dr. Semertzides, authorized the release of
information gathered at an interview attended by Wilson. The court of appeals
determined that by signing the release Semertzides waived his privilege of
confidentiality with regard to information gathered at his interview. Consequently,
the court of appeals directed the trial court to release the records pertaining to
Semertzides and to withhold any information concerning anyone else whose
privacy rights were implicated. The court ordered that all other records should
remain confidential because “[w]ithout a valid waiver from all persons whose
privacy rights are implicated, these records may not be disclosed under the Public
Records Act.”

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{¶ 23} “Waiver” is defined as a voluntary relinquishment of a known right.
See Chubb v. Ohio Bur. of Workers’ Comp. (1998), 81 Ohio St.3d 275, 278, 690
N.E.2d 1267, 1269, citing State ex rel. Athens Cty. Bd. of Commrs. v. Gallia,
Jackson, Meigs, Vinton Joint Solid Waste Mgt. Dist. Bd. of Directors (1996), 75
Ohio St.3d 611, 616, 665 N.E.2d 202, 207. Persons may either expressly or
impliedly waive statutory provisions intended for their own benefit, but statutory
provisions cannot be waived when they are intended for the benefit of others. See
Brannock v. Brannock (1986), 104 N.M. 385, 386, 722 P.2d 636, 637; see, also,
State v. Ventura (1999), 101 Ohio Misc.2d 15, 19, 720 N.E.2d 1024, 1027.
Moreover, it is a well-settled general principle that no party has the power to waive
matters that affect third parties, because the holder of the privilege is the only one
who has the power to relinquish it. Id.
{¶ 24} Several groups have a privilege of confidentiality in the Medical
Board’s investigative files. In re Kralik (1995), 101 Ohio App.3d 232, 236, 655
N.E.2d 273, 275. These groups include patients, physicians who are under
investigation, investigation witnesses, and any other persons whose confidentiality
right is implicated by a Medical Board investigation. Id. The holder of the
confidentiality privilege is the one who must waive it before the contents of the
Medical Board’s investigative files relating to that person may be divulged. Id.
Hence, when someone who is not authorized to waive the privilege discloses
privileged information, the information remains privileged. State v. Shipley (1994),
94 Ohio App.3d 771, 775, 641 N.E.2d 822, 825, citing Powers v. Chicago Transit
Auth. (C.A.7, 1989), 890 F.2d 1355, 1357-1359.
{¶ 25} By permitting Wilson to attend Medical Board interviews with
witnesses, the Medical Board waived its own confidentiality privilege; however,
the Medical Board cannot unilaterally waive others’ privileges to confidentiality,
because the Medical Board is not the holder of those privileges.

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{¶ 26} The court of appeals properly ordered an in camera review of
records pertaining to the interview with Semertzides and the release of those
records after they are redacted to protect the confidentiality of anyone else who has
not waived the privilege.
B. Insurance Department Records
{¶ 27} The State Department of Insurance is a “public office” for purposes
of R.C. 149.43. At issue is R.C. 3901.44, which relates to insurance fraud
investigatory records.
{¶ 28} Former R.C. 3901.44(A) stated: “All papers, documents, reports,
and evidence in the possession of the division of insurance fraud of the department
of insurance that pertain to an investigation conducted or authorized by the division
are confidential law enforcement investigatory records under section 149.43 of the
Revised Code. Notwithstanding such section, the division shall not prohibit public
inspection of such records that pertain to an investigation after the expiration of all
federal and state statutes of limitations applicable to the particular offense to which
the papers, documents, reports, and evidence relate.” 142 Ohio Laws, Part III,
4579. (The current version, codified at R.C. 3901.44[B], is substantially the same.)
{¶ 29} Former R.C. 3901.44(A)’s explicit reference to R.C. 149.43 requires
that the two sections be read in conjunction. “Confidential law enforcement
investigatory records” are not public records for purposes of R.C. 149.43. Former
R.C. 149.43(A)(1), now R.C. 149.43(A)(1)(h). However, this is not the end of the
inquiry. R.C. 149.43(A)(2) defines “confidential law enforcement investigatory
records” as “any record that pertains to a law enforcement matter of criminal, quasi-
criminal, civil, or administrative nature, but only to the extent that the release of the
record would create a high probability of disclosure of any of the following:
“(a) The identity of a suspect who has not been charged with the offense to
which the record pertains, or of an information source or witness to whom
confidentiality has been reasonably promised;

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“(b) Information provided by an information source or witness to whom
confidentiality has been reasonably promised, which information would reasonably
tend to disclose the source’s or witness’s identity;
“(c) Specific confidential investigatory techniques or procedures or specific
investigatory work product;
“(d) Information that would endanger the life or physical safety of law
enforcement personnel, a crime victim, a witness, or a confidential information
source.” (Emphasis added.)
{¶ 30} The Insurance Department invites this court to hold that analysis
pursuant to R.C. 149.43 is unnecessary because the plain language of R.C. 3901.44
specifically deems insurance fraud investigatory records “confidential law
enforcement investigatory records” under R.C. 149.43. We decline to adopt this
interpretation.
{¶ 31} A two-step analysis is required when exempting records from release
under R.C. 149.43(A)(2). State ex rel. Multimedia, Inc. v. Snowden (1995), 72 Ohio
St.3d 141, 142, 647 N.E.2d 1374, 1377. The first inquiry is whether the record in
question is a confidential law enforcement record. The second inquiry is whether
releasing the record would create a high probability of disclosure of any of the four
categories of information specified in R.C. 149.43(A)(2).
{¶ 32} The language employed by the General Assembly in former R.C.
3901.44(A), now (B), answers the first query in the affirmative. In essence, what
R.C. 3901.44 does is classify insurance fraud investigatory records as “confidential
law enforcement investigatory records” under R.C. 149.43. Thus, the next step is
to ascertain whether any of the exemptions in R.C. 149.43(A)(2) apply.
{¶ 33} “[E]xceptions to disclosure must be strictly construed against the
custodian of the public records, and the burden to establish an exception is on the
custodian.” Multimedia, 72 Ohio St.3d at 142, 647 N.E.2d at 1377, citing State ex
rel. James v. Ohio State Univ. (1994), 70 Ohio St.3d 168, 169, 637 N.E.2d 911,

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912; see, also, State ex rel. Gannett Satellite Info. Network, Inc. v. Petro (1997), 80
Ohio St.3d 261, 266, 685 N.E.2d 1223, 1228; State ex rel. McCleary v. Roberts
(2000), 88 Ohio St.3d 365, 370, 725 N.E.2d 1144, 1148-1149. Our duty requires
us to strictly construe confidential law enforcement investigatory records and
“resolve any doubts in favor of disclosure.” Multimedia, 72 Ohio St.3d at 143, 647
N.E.2d at 1378. Generally, in the absence of evidence that the custodian of the
records disclosed their contents to the public, the exemptions are fully applicable.
Petro, 80 Ohio St.3d at 265, 685 N.E.2d at 1227; see, also, State ex rel. WLWT-TV5
v. Leis (1997), 77 Ohio St.3d 357, 361, 673 N.E.2d 1365, 1369-1370.
{¶ 34} Application of a statutory exemption to a particular document is best
accomplished by an in camera inspection. See Henneman v. Toledo (1988), 35
Ohio St.3d 241, 243, 520 N.E.2d 207, 210. Based on the limited record before us,
we are unable to discern the nature of the records at issue. Consequently, the trial
court is the tribunal best equipped to inspect these documents in camera, to
determine whether their release “would create a high probability of disclosure” of
any of the material specified in R.C. 149.43(A)(2), and to withhold any information
that falls within a statutory exemption. After examination of the investigatory files,
material that does not fall within an exemption must be disclosed upon a request
made pursuant to R.C. 149.43, and any exempted information should be withheld.
See Franklin Cty. Sheriff’s Dept. v. State Emp. Relations Bd. (1992), 63 Ohio St.3d
498, 589 N.E.2d 24, paragraph one of the syllabus.
{¶ 35} Having concluded that a two-part inquiry is required in order to
determine whether insurance fraud investigatory records, which R.C. 3901.44
designates “confidential law enforcement investigatory records” for purposes of
R.C. 149.43, are exempted from release, we now turn to the question of whether
the Insurance Department waived its right to rely on any applicable exemptions.
{¶ 36} R.C. 149.43’s exemptions are “usually fully applicable absent
evidence that the public office having custody of the records disclosed the records

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to the public.” Petro, 80 Ohio St.3d at 265, 685 N.E.2d at 1227. Wilson, an
investigator employed by Anthem, was present at several witness interviews
conducted by Kaising. During the investigation of the appellees, Wilson attended
these interviews as a representative of Anthem and brought with him a working
knowledge of the insurance industry and his employer. At no time during his
investigation of the appellees did Kaising share or disclose the contents of the
Insurance Department’s investigatory file with Wilson. Investigations into
insurance fraud are not conducted in a vacuum. Investigators working for private
insurance companies may have occasion to interact with investigators from the
Insurance Department. As a matter of fact, R.C. 3999.42, which went into effect
in March 1998, requires that insurers having a “reasonable belief that a person is
perpetrating or facilitating an insurance fraud * * * notify the department of
insurance.” Although Wilson is a member of the public, his presence at witness
interviews conducted by the Insurance Department is not tantamount to a public
disclosure and does not effectuate a waiver of any applicable statutory exemptions.
{¶ 37} Thus, the court of appeals properly remanded this cause so that the
trial court could conduct an in camera inspection of the records in question.

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II. Conclusion
{¶ 38} The Public Records Act serves a laudable purpose by ensuring that
governmental functions are not conducted behind a shroud of secrecy. However,
even in a society where an open government is considered essential to maintaining
a properly functioning democracy, not every iota of information is subject to public
scrutiny. Certain safeguards are necessary. Accordingly, we affirm the court of
appeals and remand this cause to the trial court for further proceedings not
inconsistent with this opinion.
Judgment affirmed
and cause remanded.
MOYER, C.J., DOUGLAS, F.E. SWEENEY and PFEIFER, JJ., concur.
COOK and LUNDBERG STRATTON, JJ., concur in part and dissent in part.
__________________
COOK, J., concurring in part and dissenting in part.
{¶ 39} I agree that the Medical Board’s investigative records are not public
records and that the Medical Board waived its own—and only its own—
confidentiality privilege with respect to the Medical Board records discussed in Part
IA of the majority opinion.
{¶ 40} I respectfully dissent, however, from the majority’s judgment that
the insurance department records discussed in Part IB might be subject to public
disclosure under the Public Records Act. Former R.C. 3901.44 explicitly
categorizes the insurance department documents at issue as “confidential law
enforcement investigatory records [and thereby excepted from public disclosure as
‘public records’] under section 149.43,” which precludes the judiciary from
reaching a contrary result. The majority analyzes the applicability of the
“confidential law enforcement investigatory records” exception and concludes that
it does not apply, when the statute plainly states otherwise.

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{¶ 41} We are not privileged to ignore the plain and unambiguous language
of a statute. State v. Krutz (1986), 28 Ohio St.3d 36, 38, 28 OBR 96, 97, 502 N.E.2d
210, 211. To hold as the majority does is to do just that.
LUNDBERG STRATTON, J., concurs in the foregoing opinion.
__________________
LUNDBERG STRATTON, J., concurring in part and dissenting in part.
{¶ 42} I dissent with respect to whether the presence of a third party at
witness interviews constituted a waiver of the State Medical Board’s privilege of
confidentiality. I also join Justice Cook’s dissent and would find that insurance
department records are not subject to disclosure under the Public Records Act. I
concur as to the remainder of the majority opinion.
{¶ 43} Under Part IB of the majority’s opinion, “Insurance Department
Records,” the majority concludes that the presence of Anthem’s investigator did
not constitute a waiver of the Department of Insurance’s privilege of
confidentiality. I would apply the same rationale to Part IA and find that the
investigator’s presence also did not constitute a waiver of the Medical Board’s
privilege. There is no reason to distinguish between the two.
{¶ 44} An insurance fraud investigator is integral to the work of both the
Department of Insurance and the Medical Board to uncover fraud or handle
allegations of unauthorized medical practice. The investigator possesses the
expertise, knowledge, and investigative background that enable the Medical Board
and Department of Insurance to determine the direction of their own investigations.
At times, there were joint investigations that involved the investigator for the State
Medical Board, Patricia Elliss, the Department of Insurance investigator, Robert
Kaising, and Anthem’s investigator, Richard Wilson. They worked together to
gather evidence and interview witnesses.
{¶ 45} The allegations being investigated involved issues of fraudulent
billing, with complex billing codes and methods. The use of experts, such as

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Anthem’s investigator, is crucial in helping the Medical Board to effectively
conduct its investigation. The majority recognizes this importance to the
Department of Insurance yet somehow excludes the Medical Board from obtaining
the same benefits.
{¶ 46} The majority does not address the effect of its decision upon the
presence of other third parties; however, the logical extension is that victims and
other parties who wish to have a trusted advisor, family member, or friend present
at their interview will now waive the confidentiality of their statements. This could
affect a victim’s willingness to report wrongdoing.
{¶ 47} We should hold that the presence of an insurance investigator who
is an active participant in the investigation of the wrongdoing at a witness interview
does not result in a waiver of the confidentiality of the Medical Board’s
investigative records.
{¶ 48} Therefore, I respectfully dissent.
__________________

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11151887. Public record. Not legal advice.