The Problem
Copy services are arguing that the implementation of the new copy service fee schedule does not allow carriers and claims administrators to charge copy services a $15.00 fee, leaving many claims managers with headaches.
The California Division of Workers’ Compensation (DWC) recently finalized copy service fee schedule regulations. These regulations dictate how much copy services can charge for subpoenaed records on or after July 1, 2015. For records requests that are under $500, this will typically work out to $180 per date of service.
Subpoenas are usually generated by attorneys who want to review records in a carrier or administrator’s possession for the purpose of analyzing the relevance of earlier or concurrent workers’ compensation claims. Such records often have monumental impact on questions of causation and apportionment.
Since the publication of the copy service fee schedule regulations, copy services have refused to pay the $15.00 fee that insurers and administrators charge to comply with subpoenaed records requests. Copy services contend that California Evidence Code 1563(b) relieves them from the obligation to pay the $15.00 fee.
We believe this argument is incorrect. This position is supported by the plain wording of the statute.
California Evidence Code 1563
California Evidence Code 1563 is 956 words long, and it’s not exactly Hemingway. Let’s cut out the irrelevant parts and dissect the relevant portions of the statute:
[A]ny witness can charge all reasonable costs incurred in a civil proceeding by any witness which is not a party with respect to the production of all or any part of business records the production of which is requested pursuant to a subpoena duces tecum may be charged against the party serving the subpoena duces tecum.
In other words, a witness can charge reasonable costs to the copy service, if the witness is not a party to the litigation.
For example, assume an attorney in the case of Clark v. Jones sends a subpoena to Generic Insurance Co., an attempt to find out about Mr. Clark’s prior workers’ compensation claims. If Generic Insurance Co. is not a party to Clark v. Jones, then Generic’s claims administrator is entitled to charge “reasonable costs.”
But what are “reasonable costs?” This is where it is easy to misread the statute, as California Evidence Code 1563(b) has several different paragraphs for “reasonable costs.”
Subsection (b)(6) applies to the most typical scenario: where a copy service shows up at the carrier’s door to obtain those records. CEC 1563(b)(6) specifies that “where the records are delivered to the attorney” or for “photocopying at the witness’ place of business,” the “only fee for complying with the subpoena shall not exceed $15.” It also allows for microfilm copy costs of $0.20 a page. Any additional “actual cost” in retrieving the records (which could arguably be construed to include any unusual costs – such as shipping costs if the file is stored in Nome, Alaska), are also permitted.
In light of CEC 1563(b)(6), it is reasonable to charge $15.00, if the claims administrator is not a party to the case.
Copy Service Fee Schedule
Copy service fee schedule provisions are found throughout the California Code of Regulations. The key provision regarding “witness costs”, found in CCR 9983(e), says:
“Release of information services of witness costs for the retrieval and return of physical records held offsite by a third party are included in the flat fee. Disputes over the production of records may be resolved by filing a petition with the Workers’ Compensation Appeals Board or by filing a petition with the superior court pursuant to Labor Code section 132. Release of information services of witness costs for retrieval and return of physical records held offsite by a third party are governed by Evidence Code Section 1563.”
The first sentence states that the “witness costs” are included in the copy service’s flat fee. In other words, any reimbursement for “witness costs” is already factored into the fee schedule’s provisions on what copy services can charge. This prevents copy services from tacking on an additional $15 in witness fees to the standard fee of $180 per date of service that the copy service is allowed to charge.
The second sentence addresses how parties can resolve disputes over the production of records.
The third sentence states that witness costs for records held offsite by a third party are governed by Evidence Code 1563, which we analyzed above.
Conclusion
In conclusion, claims managers should continue to charge the $15 per subpoena request, in cases where their administrator or carrier is not a party to the subpoena’s case title. Continue to hold the copy service’s feet to the fire!
To read California Evidence Code 1563, click here.
http://www.leginfo.ca.gov/cgi-bin/displaycode?section=evid&group=01001-02000&file=1560-1567
To read the copy service fee schedule, click here.
http://www.dir.ca.gov/dwc/DWCPropRegs/CopyServiceFeeSchedule/FinalRegulations/FinalRegulationsClean.pdf
John P. Kamin is an associate attorney at Bradford & Barthel, LLP (Tarzana). He can be reached at jkamin@bradfordbarthel.com.
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