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Eleventh Circuit Finds Trial Evidence of Litigation Funding Company Does Not Violate Collateral Sour

Last week, the Eleventh Circuit issued a published opinion in the long-litigated Houston v. Publix matter. See Opinion, Appeal No. 15-13851. In that personal injury suit, evidence of the plaintiff’s contract with and payments made by ML Healthcare, a “litigation investment” company that contracts with doctors to purchase the medical debt that plaintiffs incur at a discounted rate, was deemed discoverable by the district court and, thereafter, admitted as evidence at trial.

The appellate court found that Georgia’s collateral source rule does not protect or require exclusion of the information if it was not being admitted for the sole purpose of reducing damages. In the Houston case, the court found reasonable the purposes of (1) attacking the credibility of the causation opinions offered by the treating physicians and (2) challenging the reasonableness of the claimed medical expenses.

In sum, another court, this time the highest in our circuit, has found ML Healthcare’s (and by association any such company) refusal to produce documents or appear for deposition and efforts to keep evidence of their structure and potential bias of their related physicians out of the jury’s view is not appropriate. This opinion should be considered immediately in cases pending in federal court here in Georgia as binding precedent but, also, in Georgia state courts as persuasive authority where the plaintiff has contracted with these types of funding companies which routinely buy plaintiff’s purported medical debt at a fraction of the billed amount and maintain a relationship with the doctors that may appear suspect, especially to a jury charged with determining reasonable value and causation of claimed damages.

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