Documents obtained by House Oversight may throw a monkey wrench into government's case against LabMD
On February 12, FTC Administrative Law Judge D. Michael Chappell admitted two letters from the House Oversight Committee (OGR) as exhibits in FTC v. LabMD. The letters concern OGR’s investigation of Tiversa, a firm whose statements the FTC relied upon in its data security enforcement case against LabMD (see FTC case files and previous coverage on PHIprivacy.net). Admission of the exhibits was opposed by counsel for the FTC, but in his order, Judge Chappell explains:
It should be noted that there is no dispute as to the authenticity of the OGR letters and the receipt of the letters by the FTC. Nor is there any valid dispute that the Committee “is investigating the activities of Tiversa, Inc., a company upon which the Federal Trade Commission [is] rel[ying] as a source of information in its enforcement action against LabMD, Inc.” (June 11, 2014 letter at 1); that the Committee is concerned about the truthfulness of the information provided to the FTC; or that Tiversa apparently did not fully provide requested documents subpoenaed in this matter, demonstrated by certain Tiversa documents produced by Tiversa to the OGR and attached to the December 1, 2014 letter (RX 544-RX 548). There is no reason to question the veracity of the OGR letters’ statements in this regard. Accordingly, official notice or judicial notice will be taken of these facts, and only these facts, pursuant to FTC Rule 3.43(f). In addition, the statements purportedly made by Mr. Boback to the Committee, as excerpted in the OGR letters, will not be considered for the truth of the matters asserted therein, and therefore are not, by definition, hearsay.
The first letter admitted (“RX 542”) is the June 2014 letter from Rep. Darrel Issa to the Chairwoman of the FTC, Edith Ramirez. As previously reported by PHIprivacy.net and as summarized by Judge Chappell in his order, the letter expresses concern that testimony from Tiversa’s chief executive officer, Mr. Robert Boback, was inconsistent and possibly untruthful.
The second letter admitted, (“RX 543,”) is a previously undisclosed December 2014 letter from OGR to Chairwoman Ramirez that describes – and appends – internal Tiversa documents provided to OGR by Tiversa during OGR’s investigation. OGR’s letter provides excerpts from testimony to OGR and points out the contradictions between what Tiversa provided to the FTC and what Tiversa said to, and provided to, OGR.
Although the December letter has been admitted in FTC v. LabMD, the Tiversa documents appended to that letter have yet to be admitted, with Judge Chappell denying LabMD’s motion to admit those exhibits, based on lack of evidentiary foundation. The denial was without prejudice, leaving the door open for LabMD to resubmit.
OGR’s letters to the FTC and the appended files are public records, despite Tiversa stamping them “Confidential – For Committee and Staff Use Only.” After determining that there has been no motion to treat them in camera in the administrative hearing, PHIprivacy.net decided to make the December 14th letter with all appended Tiversa internal documents available here, so that readers may form their own impressions as to whether they raise significant doubt about the accuracy and completeness of Tiversa’s testimony in the administrative case and whether the FTC should have relied on Tiversa’s reports as to the discovery of, and distribution of, a LabMD file.
Given that FTC received these letters in June and December of 2014, one wonders what steps the FTC has taken to ensure that Tiversa has now provided all documents responsive to the FTC’s 2013 subpoena and to verify the accuracy of the reports upon which it formed its case against LabMD.
In other developments in FTC vs. LabMD, former Tiversa employee Richard (“Rick”) Wallace, who is scheduled to testify under immunity on March 3 when the hearing resumes, has changed counsel and is now represented by Bryan Cave LLP.