The opinion of the court was delivered by: Gladys Kessler United States District Judge
Upon consideration of the Motion of Non-Parties HSCSN and MHS ("Non-Parties") to Reconsider the Court's Order Granting Plaintiff's [sic] Motion to Compel and for Stay Pending Reconsideration, and the Motion for Protective Order of those same Non-Parties, the Oppositions, the Replies, and the lengthy history of this case, the Court concludes that the Motion for Reconsideration is granted in part and denied in part, and the Motion for Protective Order is granted in part and denied in part.
Plaintiffs and Non-Parties have been battling over the discovery issue raised in these Motions for a long period of time. By now, the issue has narrowed down to whether a Protective Order should be granted to Non-Parties and, if so, how restrictive it should be.*fn1
On December 19, 2006, the Court granted in part and denied in part Plaintiffs' Motion for Leave to Conduct Limited Discovery Concerning Compliance with Paragraph 36 of the Settlement Order [Dkt. No. 1256]. Specifically, Plaintiffs were allowed to obtain discovery of "the general polices and procedures" of the Non-Parties for authorizing, re-authorizing, and terminating certain health services. On February 6, 2009, the Court granted Plaintiffs' Motion to Compel Specific Discovery Concerning Compliance with Paragraph 36 of the Settlement Order as it Pertains to the Provision of Home Health Care, Private Duty Nursing, and Personal Care Services [Dkt. No. 1430]. Specifically, Plaintiffs were granted access to the InterQual® Clinical Decision Support Criteria ("InterQual® Criteria"), which are evidence-based treatment guidelines developed and copyrighted by MHS. Shortly thereafter, Non-Parties filed the two Motions which are now under consideration.
Non-Parties are seeking reconsideration of the Order of February 6, 2009, granting Plaintiffs' Motion to Compel Production of the InterQual® Criteria and a Stay pending such reconsideration, as well as a Protective Order. Plaintiffs oppose those Motions on both procedural and substantive grounds. The Court will now address, albeit briefly, the main issues raised by the Non-Parties and Plaintiffs.*fn2
1. Initially, Plaintiffs argue that Non-Parties have failed to meet the high standard for reconsideration required by Fed. R. Civ. P. 59(e). While it is true, as Plaintiffs state, that the Rule 59(e) standard is a stringent one, Firestone v. Firestone, 76 F.2d 1205, 1208 (D.C. Cir. 1996), such a motion may be granted in order "to correct a clear error or prevent manifest injustice." Upon consideration of all the arguments made by the Parties, the Court concludes, as will be explained, infra, that it does "need to correct a clear error." Id.*fn3
2. In the December 19, 2006, Memorandum Order, p. 3, the Court granted in large part Plaintiffs' request, opposed by Non-Party HSCSN and the Defendants, for "limited discovery regarding HSCSN's general policies and procedures for authorizing, re-authorizing, and terminating home health care services, private duty nursing services, and personal care services when such services are prescribed for children." After conducting a significant amount of discovery, Plaintiffs filed their Motion to Compel Specific Discovery. In particular, Plaintiffs sought production of the InterQual® Criteria, the protection of which is at issue in the two pending Motions.
Non-Party McKesson Health Solutions, LLC ("MHS") holds two patents on the InterQual® Criteria and now licenses use of the Criteria to various entities. See Affidavit of Laura Coughlin ("Coughlin Aff."), Exhibit 1 to Non-Parties' Motion for Protective Order, ¶ 20, 26. The Criteria are a support tool, consisting of three basic elements, for the making of clinical care management decisions. Id. ¶ 11. The InterQual® Criteria address admissions, continued stays and transitions across the continuum of care, from acute settings through outpatient treatment and home care. The InterQual® Criteria are used to provide answers to critical questions about the appropriateness of levels of care and resource use. Id. ¶ 7.
The first element consists of information and clinical data which is distilled from the medical literature. Id. ¶¶ 11-12. The second element contains a set of unique rules developed by MHS that compiles and organizes the data to create appropriate care decisions based on what the medical literature has reported to be evidence of "best practices," or on expert clinical opinion where such evidence of "best practices" is lacking. Id. ¶¶ 11, 13. Elements 1 and 2 are combined to constitute a "criteria set." The third element is a specific methodology used to apply the InterQual® Criteria to individual patients' cases in a consistent and objective manner. Id.¶ 15.
The InterQual® Criteria are peer reviewed, edited, revised, and updated annually by MHS. Id. ¶ 16. According to MHS, the Criteria, i.e., the specific review methodology, as well as the aggregate or "unique combination" of the three elements, is not "generally known or readily ascertainable to the public," nor is it "generally known within the industry." Id.
Non-Party MHS derives substantial value from what it believes to be the unique combination of elements that comprise the InterQual® Criteria. MHS licenses use of the Criteria to more than 4,000 health care plans, hospitals, academic medical centers, government agencies, and managed care organizations. Id. ¶ 9. These health care providers pay license fees for the right to access and use the InterQual® Criteria. Id. ¶¶ 26, 28.
3. In its Opinion of February 6, 2009, granting Plaintiffs' Motion to Compel Specific Discovery, namely, the InterQual® Criteria, the Court explained that:
Plaintiffs' counsel have an obligation to monitor compliance with the Settlement Agreement, including paragraph 36 concerning the provision of in-home services. In particular, Plaintiffs' counsel need to know what criteria HSCSN is relying upon in making decisions, which are of great significance to their clients, regarding the authorization, re-authorization, and/or ...