Iowa Supreme Court Issues Favorable Ruling for Employers and Insurers on Surveillance

 

Iowa Supreme Court Issues Favorable Ruling for Employers and Insurers on Surveillance

On June 12, 2015, the Iowa Supreme Court issued a long-awaited decision on the Commissioner's Surveillance Ruling.  The Supreme Court concluded that surveillance information is work product that does not need to be produced prior to the taking of the claimant's deposition.  In doing so, it reversed the Commissioner, the District Court, and the Court of Appeals.  

Background

 

IA Code 85.27(2) provides that any employee, employer or insurance carrier must release all information in its possession concerning the employee's physical or mental condition relative to the claim and waives all privileges for the release of the information.

 

In 2012, a group comprised primarily of claimant's attorneys filed a petition requesting that the Iowa Workers' Compensation Commissioner issue a declaratory opinion as to whether surveillance on the employee was  evidence of the employee's physical or medical condition within the definition of IA Code 85.27(2) that must be produced over a claim of privilege. The Commissioner interpreted IA Code 85.27(2) broadly to mean that all materials with a causal relationship to the employee's physical or mental condition must be produced because of the "allinformation" language in the statute. The Commissioner concluded that surveillance materials were evidence contemplated by 85.27(2), and employers could not assert the work product privilege to avoid producing the surveillance, because the surveillance documents the employee's physical condition.   The District Court and Court of Appeals agreed, and the Supreme Court accepted the case for review.

 

Supreme Court Decision

In its June 12, 2015 ruling, the Iowa Supreme Court reversed the District Court and Court of Appeals decisions. The Supreme Court interpreted IA Code 85.27(2) narrowly to only apply to medical records and reports and not all information that may have a causal relationship with plaintiff's physical or mental condition. It concluded that surveillance materials were documents prepared in anticipation of litigation and not medical evidence within the meaning of IA Code 85.27(2).  


 
The Court remanded the case back to the Commissioner without addressing any of the other issues raised by the plaintiffs in the declaratory action.  Instead, the Court held that those issues should "await a case or cases in which they are fully briefed and squarely presented."  For now, however, it is clear that surveillance remains a viable tool in a claim handler's arsenal and the negative impact of the Commissioner's original opinion on impeachment value is negated.