Order, Supreme Court, New York County (Marcy S. Friedman, J.), entered August 24, 2006, which granted the petition directing compliance with a subpoena and denied the cross motion to quash, unanimously affirmed, without costs.
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
Tom, J.P., Nardelli, Williams, McGuire, JJ.
Tom, J.P. and Williams, J. concur in a separate memorandum by Tom, J.P. as follows:
The Attorney General issued the subject subpoena in the course of an investigation of financial impropriety and mismanagement at respondent nursing home, as well as possible patient abuse (see Public Health Law § 2803-c). The Attorney General's office is empowered to apply to enjoin such fraudulent or illegal activities, to take proof and to issue subpoenas "[i]n connection with any such application" (Executive Law § 63). The Health Insurance Portability and Accountability Act of 1996 (HIPAA) (42 USC § 1302d et seq.) authorizes the production of medical records where they are reasonably related to a "legitimate law enforcement inquiry" (45 CFR 164.512 [f][ii][C]; see Matter of La Belle Creole Intl., S.A. v Attorney-General of State of N.Y., 10 NY2d 192, 196-197 ).
We agree with Supreme Court that when investigating possible violations of law at a health related facility (see e.g. 42 USC § 1320a-7b), the Attorney General's office functions as a "health oversight agency" within the meaning of HIPAA (45 CFR 164.501; 164.512[d]). The Attorney General has demonstrated "authority, relevancy, and some basis for inquisitorial action" (Matter of A'Hearn v Committee on Unlawful Practice of Law of N.Y. County Lawyers' Assn., 23 NY2d 916, 918 , cert denied 395 US 959 ), and except where "the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any proper inquiry" a subpoena will not be quashed (Anheuser-Busch, Inc. v Abrams, 71 NY2d 327, 331-332  [internal quotation marks and citations omitted]). Finally, we note that the requirement of Executive Law § 63(12) that a party under investigation "engage in repeated fraudulent or illegal acts" refers to the party operating the business, here respondent nursing home, not to a person in its care. While the subpoenaed records involve incidents of patient misconduct, they reflect respondent's failure to protect the rights guaranteed to patients under Public Health Law § 2803-c. Thus, we regard the incidents as relevant to, and indicative of, the overall pattern of mismanagement under investigation, not as mere isolated lapses in patient care.
Nardelli and McGuire, JJ. concur in a separate memorandum by McGuire, J. as follows:
I agree with Justice Tom's concurrence that the order of Supreme Court should be affirmed, but reach that conclusion for different reasons.
Justice Tom's concurrence upholds the issuance of the subpoenas solely on the ground of the Attorney General's authority under Executive Law § 63(12). I would not rely on that statute. The Attorney General argues that Executive Law § 63(12) is not limited to consumer fraud cases, and I do not quarrel with the argument at that level of generality. But it is far from obvious that the Attorney General's authority under Executive Law § 63(12) is so sweeping as to authorize the issuance of subpoenas to respondent seeking the medical records of four residents relating to two incidents of, as the Attorney General characterizes it in his brief, "sexually aggressive behavior" by two of the four residents. More particularly, I have serious doubts that these two incidents satisfy the statute's requirements of either "repeated . . . illegal acts" or "persistent . . . illegality" (Executive Law § 63 [emphasis added]).*fn1
Notably, the Attorney General does not venture any explanation of the "illegal" character of the "sexually aggressive behavior" engaged in by the two residents. If the Attorney General's authority under this statute is so sweeping, it would appear that the Attorney General could issue subpoenas to any hospital or nursing home whenever he had reason to believe that two patients had been harassed by another patient or that one patient had twice been harassed by another patient. Moreover, under the Attorney General's view of his powers under Executive Law § 63(12), it appears to be irrelevant that the ostensibly "illegal" conduct was not committed by the party being investigated. That is hard to square with the terms of the statute, which authorizes the Attorney General to bring suit and investigate "[w]henever any person shall engage in repeated fraudulent or illegal acts or otherwise demonstrate persistent fraud or illegality in the carrying on, conducting or transaction of business" (Executive Law § 63). Although it is not clear what conduct would satisfy the requirements of repeated illegal acts or persistent illegality under the Attorney General's view, presumably the Attorney General does not contend that two instances of patient neglect or negligent medical care occurring in a hospital or nursing home would be sufficient.
Justice Tom's concurrence, however, apparently embraces that extraordinary contention. It first correctly recognizes that "the requirement of Executive Law § 63(12) that a party under investigation 'engage in repeated fraudulent or illegal acts' refers to the party operating the business, here respondent nursing home, not to a person in its care." It then goes on to state that the two "incidents of patient misconduct" establish the requisite illegal acts by respondent because they "reflect respondent's failure to protect the rights guaranteed to patients under Public Health Law § 2803-c." Presumably Justice Tom is referring to paragraph (h) of subdivision 3 of § 2803-c, which provides in relevant part that "[e]very patient shall be free from mental and physical abuse." I respectfully submit that it is far from obvious that any nursing home or hospital in this state engages in "illegal acts" within ...