Legal News
Providing Private Consumer Or Employment Records Just Got Safer, Thanks To Appellate Decision
Monday, October 01, 2007
Banks, employers and others required to respond to subpoenas seeking private consumer or employment records are protected from being sued for producing too much information in response to a subpoena, a Los Angeles Court of Appeal recently ruled. The appellate court found that although a financial institution provided consumer records beyond those authorized by the subpoena, there was no procedure for consumer to sue the institution. Foothill Federal Credit Union v. Superior Court (September 24, 2007) __Cal.App.4th__.
Foothill was a probate action in which a subpoena for bank account information was issued to Foothill Federal Credit Union for information relating to the decedent's bank accounts and those of Janet King, a party to the action. The attorneys in the case agreed to limit the subpoena to accounts held jointly by Ms. King and the decedent. Foothill -- apparently unaware of the limited subpoena scope-- turned over information concerning Ms. King's other accounts, including accounts held jointly with unrelated third party consumers. Additionally, some of those third party consumers had not received any required notice that the parties were seeking production of those records. The affected consumers sued Foothill, claiming, among other things, invasion of privacy and intentional infliction of emotional distress.
The Foothill court held that Foothill was protected from liability in the third party consumers' suit by the "litigation privilege" in Code of Civil Procedure section 47(b), which provides immunity for acts or statements connected with litigation. Even though the documents produced by Foothill exceeded those technically authorized by the subpoena's limited scope, the court found that the document production had "some connection or logical relation to the action." . The Foothill court noted that purpose of the litigation privilege, allowing participation in the judicial process without fear of being sued later, is served by applying it to this situation. This is consistent with a previous clear statement of the California Supreme Court that "an unending roundelay of litigation" is "an evil far worse than an occasional unfair result." Silberg v. Anderson (1990) 50 Cal.4th 205, 213-14. Moreover, the Code of Civil Procedure section requiring notice to the consumers does not explicitly provide for an individual right of action against the document provider.
Although this ruling applies specifically to the production of consumer records under Code of Civil Procedure section 1985.3, the logic would apply to other acts in compliance with a subpoena, such as providing employee records under section 1985.6, which has a similar notice procedure intended to allow the employee to object to the production. Since the litigation privilege set out in section 47(b) is a legislative creation, the legislature could pass a statute undoing the effect of this decision. Indeed, one of the three Justices who signed this opinion wrote a separate concurring opinion urging just that.
