UPMC, Highmark fight over nixed settlement agreement

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Proving that no legal hill is too small for a pitched battle between them, UPMC and Highmark today argued in court about whether documents underlying a nixed settlement agreement are subject to discovery.

Four attorneys for UPMC, two for Highmark and two for a plaintiff group led by Royal Mile Co. spent more than an hour and a half debating the issue before U.S. District Judge Joy Flowers Conti. She did not make a decision.

Royal Mile sued UPMC and Highmark, alleging that they conspired to charge artificially high rates for care and insurance, respectively, and to stifle competition. Around a year ago, Highmark and Royal Mile agreed to settle, which would have left UPMC as the lone defendant. But in January the settlement agreement fell apart.

UPMC wants to see communications between lawyers for Highmark and Royal Mile, so it can challenge the adequacy of Royal Mile's attorneys and the credibility of Highmark officials.

Case law suggests that it's difficult for one party to get access to documentation of settlement talks between other parties. Attorney Rebekah Kcehowski said this case is one of the exceptions.

"Something absolutely remarkable happened in the context of the settlement here," she said. "There have been very serious allegations of misrepresentation and dishonesty in the settlement negotiations, by both sides."

Scott Hare, representing Royal Mile, said UPMC was engaged in "a hypocritical argument.

"UPMC itself, your honor, solicited plaintiff's counsel to settle with UPMC," he said, "and having been unsuccessful, UPMC attacked" Highmark and Royal Mile.

"The whole issue is mooted, because the settlement didn't happen," said Margaret Zwisler, representing Highmark.

All sides have already argued the issue before a former judge who is serving as a special master for discovery in the legal slugfest between them. The special master found that UPMC has a right to see the communications, but the ultimate decision rests with Judge Conti.

"I would like to see some supplemental briefing," said Judge Conti, especially on whether details of the settlement discussions can be legitimately used to challenge witness credibility.

Rich Lord: rlord@post-gazette.com, 412-263-1542 or Twitter @richelord

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