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CCA of Tennessee, LLC v. Dep't of Veterans Affairs

April 27, 2010


The opinion of the court was delivered by: Hayes, Judge


The matters before the Court are the Motion for Summary Judgment and Permanent Injunction, filed by Plaintiff CCA of Tennessee, LLC ("CCA") ("CCA's Motion") (Doc. # 9), and the Motion to Dismiss Complaint Or, in the Alternative, for Summary Judgment, filed by Defendants Department of Veterans Affairs ("VA"), Erik K. Shinseki, Eric LaZare, and Karen Schoenfeld-Smith ("VA Motion") (Doc. # 13).

I. Background

On November 2, 2009, CCA initiated this action by filing a Complaint in this Court. (Doc. # 1). Pursuant to the Administrative Procedures Act ("APA"), CCA seeks review of a final decision by the VA denying CCA's request to depose a VA employee, Defendant Karen Schoenfeld-Smith ("Dr. Schoenfeld-Smith"), in a separate state court action.

A. Allegations of the Complaint

CCA is a private company that operates and manages a correctional facility in the County of San Diego, California. (Doc. #1 ¶ 3). The VA is a United States Government agency which operates the San Diego Veterans Center. (Doc. # 1 ¶ 4). This case arises from a state court action (the "Underlying Action") in which Enrique Velez, a former correctional officer of CCA's San Diego Correctional Facility ("the Facility"), sued CCA in connection with his termination from CCA. (Doc. # 1 ¶ 8). In December 2006, while Velez was on duty, an inmate in the Facility assaulted another inmate. (Doc. # 1 ¶ 9). CCA placed Velez on administrative leave pending an investigation into the events surrounding the assault and subsequently terminated Velez from his employment with CCA. (Doc. # 1 ¶ 9--10).

In the Underlying Action against CCA, Velez alleged the following causes of action: (1) wrongful termination in violation of public policy; (2) violation of California Labor Code Section 6310; (3) interference with protected leave under California Family Rights Act; (4) disability discrimination; (5) failure to accommodate; (6) failure to engage in interactive process; (7) retaliation; (8) defamation; and (9) intentional infliction of emotional distress. (Doc. # 1 ¶ 11). Velez's alleged disability is post-traumatic stress disorder ("PTSD"), "a disability he claims he suffered while returning from his military service in the Gulf War." (Doc. # 1 ¶ 12). In the Underlying Action, Velez alleges:

(a) CCA's conduct exacerbated his PTSD symptoms; (b) as a direct result of the conduct of CCA, he has suffered severe emotional distress including, but not limited to, fright, nervousness, grief, anxiety, worry, shock, humiliation, and indignity, as well as physical pain; (c) Velez suffered from post traumatic stress disorder prior to the events alleged in the complaint; and (d) CCA's decision to deny Velez medical leave and/or reasonable accommodations on or about November 28, 2006 was discriminatory, based on his disability, namely post traumatic stress disorder. (Doc. # 1 ¶ 13). "Based on his allegations and claims, Velez has put his mental and medical conditions at issue" in the Underlying Action. (Doc. # 1 ¶ 14).

Dr. Schoenfeld-Smith, a clinical psychologist at the San Diego Veterans Center, began treating Velez on September 21, 2006, and since that date, has treated Velez "at least 72 times regarding his PTSD and emotional distress." (Doc. # 1 ¶ 15). Velez testified in a deposition in the Underlying Action that he "sees counselors at the VA hospital, including Dr. Schoenfeld-Smith, for a hazing incident that occurred when he was returning from the Gulf War, his PTSD and resulting emotional distress." (Doc. # 1 ¶ 16).

"In order to test the truth of [Velez's] allegations of causation and damages and to discover other factors in Velez's life that contributed, and may, in fact, have been the sole or contributing causes of Velez's alleged emotional injuries, CCA sought his medical records from the VA and deposition testimony from Dr. Schoenfeld-Smith." (Doc. # 1 ¶ 17).

On May 13, 2009, CCA filed in the Underlying Action a motion to compel Velez to sign authorization forms for release of his medical records from the VA's San Diego Veterans Center. (Doc. # 1 ¶ 18). "In support of Velez's opposition to CCA's motion to compel, Dr. Schoenfeld-Smith stated in a sworn declaration that one of the factors that can exacerbate Velez's PTSD symptoms is 'when large bureaucracy runs ineffectively and the individual is highly scrutinized.'" (Doc. # 1 ¶ 19).

"On June 5, 2009, the court in the Underlying Action ruled in favor of CCA and found there was a compelling need for the information concerning Velez's mental condition; otherwise, as the court stated, it would 'unfairly hamstring [CCA] in defending against [Velez]'s claim for emotional distress damages' and CCA would not be able to 'assess the conclusions reached by [Velez]'s medical providers regarding [Velez]'s diagnosis and the severity of the pre-existing emotional distress.'" (Doc. # 1 ¶ 20). Dr. Schoenfeld-Smith complied with the court's order by producing "records and files of her counseling sessions with Velez, including her handwritten notes." (Doc. # 1 ¶ 21).

On September 22, 2009, "CCA sent a Touhy letter requesting that the VA produce for deposition Dr. Schoenfeld-Smith pursuant to Title 38 of the Code of Federal Regulations ... § 14.800, et seq." (Doc. # 1 ¶ 22; see also Doc. # 1, Ex. B). CCA also issued a subpoena for Dr. Schoenfeld-Smith's deposition testimony. (Doc. # 1 ¶ 23).

On September 24, 2009, Eric LaZare, an attorney with the Regional Counsel's Office of the VA, sent CCA's counsel a letter requesting that CCA "voluntarily withdraw its deposition subpoena" and stating that "[t]he County of San Diego Superior Court does not have jurisdiction to compel the production of testimony because Federal regulations prohibit this action and Agency approval is not granted." (Doc. # 1, Ex. C). On September 29, 2009, LaZare sent CCA's counsel another letter, stating that the VA "has considered and hereby denies your Touhy request." (Doc. # 1, Ex. C).

"On September 29, 2009, counsel for CCA discussed CCA's Touhy request and subpoena for the deposition testimony of Dr. Schoenfeld-Smith with LaZare.... During this discussion, LaZare did not provide any reason as to why CCA's request was denied other than stating that a federal court is the only judicial entity with the authority to compel the testimony of VA employees and [LaZare] confirmed that the VA would not produce Dr. Schoenfeld-Smith for deposition." (Doc. # 1 ¶¶ 26-27).

In the Complaint's sole cause of action, CCA alleges that the VA's refusal to permit the deposition of Dr. Schoenfeld-Smith is "arbitrary, capricious and an abuse of discretion." (Doc. # 1 ¶ 39). CCA alleges that "[w]ithout the deposition testimony of Dr. Scheonfeld-Smith, CCA cannot meaningfully respond to Velez's allegations of injuries suffered as a result of CCA's alleged conduct. Dr. Scheonfeld-Smith's testimony is also necessary to authenticate and decipher her handwritten notes that she produced in the Underlying Action." (Doc. # 1 ¶ 44). CCA requests that this Court, pursuant to the APA, "[e]nter appropriate declaratory relief to ensure that the VA provides to CCA authorization to depose Dr. Schoenfeld-Smith ... [and] that Dr. Schoenfeld-Smith ...

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