                                               RENDERED: FEBRUARY 19, 2015
                                                          TO BE PUBLISHED

               Suprrint Court of 'I rtifurkv
                               2014-SC-000355-MR


COMMONWEALTH OF KENTUCKY,                                             APPELLANTS
FINANCE AND ADMINISTRATION CABINET;
LORI FLANERY, IN HER OFFICIAL
CAPACITY AS SECRETARY OF THE
FINANCE AND ADMINISTRATION CABINET;
COMMONWEALTH OF KENTUCKY,
CABINET FOR HEALTH AND FAMILY
SERVICES; AUDREY HAYNES, IN HER
OFFICIAL CAPACITY AS SECRETARY OF
THE CABINET FOR HEALTH AND FAMILY
SERVICES; COMMONWEALTH OF
KENTUCKY, DEPARTMENT OF MEDICAID
SERVICES; AND LAWRENCE KISSNER, IN
HIS OFFICIAL CAPACITY AS
COMMISSIONER OF THE DEPARTMENT
FOR MEDICAID SERVICES


                    ON APPEAL FROM COURT OF APPEALS
V.                        NO. 2014-CA-000429-MR
                  FRANKLIN CIRCUIT COURT NO. 12-CI-01373


HONORABLE THOMAS D. WINGATE,                                           APPELLEES
JUDGE, FRANKLIN CIRCUIT COURT; AND
KENTUCKY SPIRIT HEALTH PLAN, INC.


               OPINION OF THE COURT BY JUSTICE VENTERS

                         VACATING AND REMANDING

      Appellants, Commonwealth of Kentucky, Finance and Administration

Cabinet, et al. (collectively, Cabinet), appeal from an order of the Court of

Appeals granting the petition of Kentucky Spirit Health Care Plan, Inc., for a

writ of prohibition against Franklin Circuit Court Judge Thomas Wingate. The
writ prohibited Judge Wingate from enforcing an order imposing a stay of

discovery in the underlying declaratory judgment litigation.

      Kentucky Spirit brought a declaratory judgment action seeking a ruling

that it had a right to terminate its Medicaid managed care contract with the

Cabinet, without penalty, prior to the expiration of the contract. Following a

partial summary judgment in favor of the Cabinet, Kentucky Spirit appealed

and the Cabinet cross-appealed. While those appeals are pending, Kentucky

Spirit intended to pursue pre-trial discovery measures relating to its rights

under the Medicaid contract. The circuit court, however, stayed those

discovery efforts until the resolution of the partial summary judgment appeals.'

In concluding that Kentucky Spirit should have the right to proceed with

discovery, pending the appeal, the Court of Appeals determined that the trial

court's suspension of discovery amounted to an indefinite stay on discovery

without a pressing need to do so in violation of Estate of Cline v. Weddle, 250

S.W.3d 330 (Ky. 2008) and Rehm v. Clayton, 132 S.W.3d 864 (Ky. 2004).

      As grounds for relief from the writ, the Cabinet argues that: (1) the trial

court's stay of discovery was proper because upon Kentucky Spirit's appeal of

the partial summary judgment order, the Franklin Circuit Court lost "subject

matter jurisdiction" over the proceeding and, therefore, there was no ongoing

circuit court jurisdiction under which discovery could proceed; and (2) even if


      1  On February 6, 2015, the Court of Appeals affirmed the trial court's partial
summary judgment. See Kentucky Spirit Health Plan, Inc. v. Commonwealth Finance
and Administration Cabinet, 2013-CA-001050-MR and 2013-CA-001201-MR, 2015 WL
510852, (Ky. App. Feb. 6, 2015). The Court of Appeals opinion had not attained
finality as of the rendition date of this opinion.

                                          2
the circuit court was not divested of subject matter jurisdiction by the appeal

from the partial summary judgment, a stay of discovery was appropriate

pending resolution of the threshold issues currently on appeal.

      Because the circuit court did not abuse its discretion by temporarily

staying discovery, we vacate the writ issued by the Court of Appeals and

remand for entry of an order denying Kentucky Spirit's petition for a writ of

prohibition.


                 I. FACTUAL AND PROCEDURAL BACKGROUND
      In July 2011, Kentucky Spirit entered into a three-year contract with the

Cabinet to provide Medicaid services in Kentucky. In October 2012, Kentucky

Spirit filed a petition for declaratory judgment (Case No. 12-CI-1373) in

Franklin Circuit Court seeking a determination that it had the right to an early

termination of the contract, without liability for damages, effective July 5,

2013, one year prior to the scheduled conclusion of the initial term under the

provisions of the contract. The complaint further alleged that in the event that

Kentucky Spirit was subject to damages, then those damages should be

calculated pursuant to the liquidated damages provision of the contract. In

April 2013, Kentucky Spirit brought a second lawsuit in Franklin Circuit Court

(Case No. 13-CI-458) in which it alleged various damage claims against the

Cabinet based upon the Cabinet's alleged breach of contract; the Cabinet

responded with its own counterclaim for damages. The two lawsuits were

subsequently consolidated.



                                         3
       On May 31, 2013, the circuit court entered an order rejecting Kentucky

Spirit's claim that it was entitled to an early termination of the contract,

holding instead that the company did not have that right. The order further

stated that if Kentucky Spirit did not perform its obligations under the

contract, it would be in breach of the contract and would consequently be

subject to liability under the liquidated damages section of the contract.

Because the order did not resolve all of the issues between the parties (more

specifically, Count III in Case No 12-CI-1373 and Counts I-VIII in Case No 13-

CI-458 remained unresolved) the trial court's order was a "partial summary

judgment" with additional matters remaining to be decided. 2

       Kentucky Spirit appealed the partial summary judgment order, and the

Cabinet filed a cross-appeal challenging the ruling insofar as it determined that

damages would be calculated exclusively under the liquidated damages clause

of the contract. The issue of the circuit court's continuing "jurisdiction" over

the case during the pendency of the appeal was first introduced as an issue by

the circuit court itself in connection with a motion for injunctive relief filed by

the Cabinet seeking to compel Kentucky Spirit to continue to perform under

the contract beyond its announced termination date of July 5, 2013. In its

order denying that motion, the- circuit court stated that the appeal of its partial

summary judgment order "had divested this court of jurisdiction"; the circuit



      2  Recognizing that its partial summary judgment ruling did not dispose of all of
the claims pending before it and therefore would otherwise be a non-final order, the
circuit court included the language of CR 54.02 in the order by stating "[t]his order is
final and appealable and there is no just cause for delay."

                                            4
court further stated that it "decline[d] to invoke any residual discretionary

jurisdiction it may retain" so as to address the motion for injunctive relief.

       While the appeal of the partial summary judgment awaited adjudication

in the Court of Appeals, Kentucky Spirit served a fifty-item request for

production of documents on the Cabinet; the Cabinet responded with a motion

to stay discovery. 3 In its order granting the Cabinet's motion for a stay the

circuit court stated as follows:

       Plaintiff desires to proceed with discovery in this matter,
       particularly regarding damages and reformation claims. However,
       this Court is without jurisdiction as this matter has been fully
       adjudicated at this level. An Opinion and Order was entered on
       May 31, 2013 granting summary judgment in favor of the
       Defendants. Of importance in the abovementioned Opinion and
       Order was the discussion pertaining to the ambiguity of the
       contract. The Court stated "[w]hile Section 39.13 is arguably
       poorly drafted, the terms of the Contract as a whole are not
       ambiguous," and therefore held reformation of the Contract would
       not occur. Furthermore, the Court's instruction in an Order
       entered on June 25, 2013, stated "[s]hould Defendants seek
       redress of the claims for monetary damages, the Court suggests
       filing an independent original action for breach of contract at the
       appropriate time." The Court directs the parties to the Court of
       Appeals. The Court relies upon the abovementioned Orders while
       addressing the instant Motion and holds again that jurisdiction
       does not remain in the Franklin Circuit Court.

(emphasis added). In response to the Cabinet's motion for reconsideration of

this order the circuit court corrected its erroneous reference to the cases

having been "fully adjudicated," stating "Nile Court's February 6, 2014 Order

did not dispose of either Count III of Plaintiff's declaratory judgment complaint



       3 Kentucky Spirit alleges that this document request applied only to issues
relating to the second lawsuit (the one relating to damages) and did not apply to the
issues relating to the now appealed declaratory judgment action.

                                            5
in 12 - CI - 1373 or Counts I-VIII of Plaintiff's complaint in 13-CI-458, as those

counts have not been adjudicated. However, the Court maintains that a stay of

discovery in this matter is appropriate."

       Following the circuit court's stay of discovery, Kentucky Spirit filed a

petition for a writ of prohibition in the Court of Appeals seeking a writ that

would permit it to proceed with discovery on the remaining issues while the

partial summary judgment was addressed in the appellate courts. The Court of

Appeals concluded that the stay of discovery amounted to an impermissible

indefinite stay on discovery without a pressing need to do so in violation of

Weddle and Rehm. This appeal followed.


                              II. STANDARD' OF REVIEW
      We set forth the standard for granting a writ of prohibition in Hoskins v.

Maricle: "A writ . . . may be granted upon a showing that (1) the lower court is

proceeding or is about to proceed outside of its jurisdiction and there is no

remedy through an application to an intermediate court; or (2) the lower court

is acting or is about to act erroneously, although within its jurisdiction, and

there exists no adequate remedy by appeal or otherwise and great injustice and

irreparable injury will result if the petition is not granted." 4 150 S.W.3d 1, 10

(Ky. 2004); see also CR 81. Further, it is well established that a writ of

prohibition "is an 'extraordinary remedy' that Kentucky courts 'have always

been cautious and conservative both in entertaining petitions for and in

        4 We frequently refer to the first mentioned basis for writ relief as Hoskins's
"first class" writ, and the basis for writ relief mentioned second as Hoskins's "second
class" writ.

                                            6
granting such relief."' Newell Enterprises, Inc. v. Bowling, 158 S.W.3d 750, 754

(Ky. 2005) 5 (quoting Bender v. Eaton, 343 S.W.2d 799, 800 (Ky. 1961)).

      Typically, a Court of Appeals decision to grant or deny a writ is reviewed

for an abuse of discretion. Southern Financial Life Ins. Co. v. Combs, 413

S.W.3d 921, 926 (Ky. 2013). "But when the issue presented involves a

question of law, we review the question of law de novo." Id. Because there are

no issues of law predominating in this proceeding, our review is pursuant to

the abuse of discretion standard.


                                    III. ANALYSIS
A. The Appeal of the Partial Summary Judgment did not Divest the
   Circuit Court of Subject Matter Jurisdiction and thus May not be
   Relied Upon by the Cabinet as an Alternative Grounds for Relief.
      The Cabinet's first argument is that the circuit court properly entered a

stay on discovery because, with the appeal of the partial summary judgment

pending, the circuit court was divested "of all jurisdiction over the case," and

therefore, further discovery was improper.

      We first note that Kentucky Spirit itself did not seek relief in its petition

to the Court of Appeals under the first class of the Hoskins writ standard, and

does not argue that the circuit court lost jurisdiction following the partial

summary judgment. Rather, as an alternative grounds for upholding the

circuit court's ruling, the Cabinet argues that, upon the appeal of the partial

summary judgment, the circuit court lost "subject matter jurisdiction" to



      5  Overruled on other grounds by Interactive Media Entertainment and Gaming
Ass'n, Inc. v. Wingate, 320 S.W.3d 692 (Ky. 2010).

                                          7
further preside over the case, including the power to oversee discovery. 6 The

Cabinet, however, misperceives the concept of "subject matter jurisdiction" as

that terminology has been defined in our relevant precedents. "In Kentucky,

circuit courts are courts of 'general jurisdiction,' which means that circuit

courts 'shall have original jurisdiction of all justiciable causes not vested in

some other court."' Davis v. Wingate, 437 S.W.3d 720, 725 (Ky. 2014) (citing

Ky. Const. § 112(5)). Thus "subject-matter jurisdiction" refers to a circuit

court's authority not simply to hear this case, but rather, to hear "this kind of

case." Id.; see also Lee v. George, 369 S.W.3d 29, 33 (Ky. 2012) ("In the context

of the extraordinary writs, jurisdiction' refers not to mere legal errors but to

subject-matter jurisdiction . . . which goes to the court's core authority to even

hear cases" (citations omitted)); Daugherty v. Telek, 366 S.W.3d 463, 467 (Ky.

2012) ("Once filed, a court has subject matter jurisdiction of the case so long as

the pleadings reveal it is the kind of case assigned to that court by a statute or

constitutional provision.").

       Here, the underlying claims relate to Kentucky Spirit's action for

ascertaining its right to an early termination of the Medicaid contract and

associated issues concerning the measure of damages. Circuit Courts, as

courts of general jurisdiction, KRS 23A.010(1), 7 have subject matter


        6 See Commonwealth, Corrections Cabinet v. Vester, 956 S.W.2d 204, 205-06
(Ky. 1997) ("[w]here the prevailing party seeks only to have the judgment affirmed, it is
entitled to argue without filing a cross-appeal that the trial court reached the correct
result for the reasons it expressed and for any other reasons appropriately brought to
its attention.").
        7 "The Circuit Court is a court of general jurisdiction; it has original jurisdiction
of all justiciable causes not exclusively vested in some other court." KRS 23A.010(1).

                                              8
jurisdiction over declaratory -judgments and contract disputes of the type at

issue. See KRS 418.040 (declaratory judgment statute); Bank One Kentucky

NA v. Woodfield Financial Consortium LP, 957 S.W.2d 276, 280 (Ky. App. 1997)

(a claim for declaratory relief seeking the construction and interpretation of a

contract is valid under KRS 418.040). Thus the Cabinet's argument that the

circuit court lacks "subject matter jurisdiction" because of the order granting

partial summary judgment and subsequent appeal is inaccurate. The award of

partial summary judgment and the associated appeal does not implicate the

relevant inquiry: whether the Franklin Circuit Court has the authority to hear

"this kind of case."

      In summary, we are unpersuaded by the Cabinet argument that the

circuit court's holding may be upheld upon the basis that it had lost "subject

matter jurisdiction" over the underlying litigation, and so may not further

preside over the case in any manner.

B. The Court of Appeals Abused its Discretion in Granting the Writ.
      The Cabinet argues that even if the circuit court was not divested of

subject matter jurisdiction by the appeal from the partial summary judgment,

a stay of discovery was appropriate pending resolution of the threshold issues

currently under litigation on appeal. We address this argument under the

second class of the Hoskins test. For a writ to succeed under the second class

of Hoskins Kentucky Spirit must demonstrate that: (1) Franklin Circuit Court

is acting, or is about to act, erroneously, although within its jurisdiction; (2)




                                          9
there exists no adequate remedy by appeal or otherwise; and (3) great injustice

and irreparable injury will result if the petition is not granted.

      As discussed above, under the circumstances before us, the circuit court

was not acting outside of its subject matter jurisdiction when it chose to abate

discovery pending resolution of the appeal. However, we have previously held

that the filing of a notice of appeal under CR 73.01(2) divests the circuit court

of particular casejurisdiction and transfers that authority to the appellate

court. City of Devondale v. Stallings, 795 S.W.2d 954, 957 (Ky. 1990); see also

Johnson v. Commonwealth, 17 S.W.3d 109, 113 (Ky. 2000) ("As 'a general rule,

except with respect to issues of custody and child support in a domestic

relations case, the filing of a notice of appeal divests the trial court of

jurisdiction to rule on any issues while the appeal is pending.") (citations

omitted). Hence, upon the filing of a notice of appeal, while a circuit court

retains subject matter jurisdiction over that type of case, it will typically lose

particular case jurisdiction over the specific lawsuit owing to the transfer of

that jurisdiction to the appellate courts. In declining jurisdiction over the case,

the circuit court specifically cited to Stallings, and the Cabinet relies upon that

same principle in supporting its argument that the circuit court was deprived

of jurisdiction over the case such that ongoing discovery proceedings would be

improper. However, in Garnett v. Oliver, our predecessor court held that "if the

appeal from the particular order or judgment does not bring the entire cause

into the appellate court . . . further proceedings in the conduct of the cause

may properly be had in the lower court." 45 S.W.2d 815, 817 (Ky. 1931).         See


                                          10
also Commonwealth v. Bailey, 71 S.W.3d 73, 84 (Ky. 2002) ("An interlocutory

appeal, however, generally only deprives the trial court of the authority to act

further in the matter that is subject of the appeal, and the trial court is not

divested of the authority to act in matters unrelated to the appeal.").

      Thus, pursuant to Garnett and Bailey, because Kentucky Spirit's appeal

and the Cabinet's cross-appeal of the partial summary judgment, did not "bring

the entire cause into the appellate court ... further proceedings in the conduct

of the cause may properly be had in the lower court."      Garnett, 45 S.W.2d at

817. As such, we are unpersuaded that Stallings is dispositive of the issue.

      Kentucky Spirit claims that its document request applied exclusively to

the damages action and was totally unrelated to the matter pending on appeal,

and "is based upon different facts, asserts different claims, and seeks different

relief than the Declaratory Judgment Action." The Cabinet disputes that claim

and offers examples of how the issues remaining in the circuit court overlap

with the matter on appeal. We conclude that Garnett is the controlling

authority. The circuit court retained jurisdiction over pending claims not being

appealed. Ancillary to that jurisdiction is the authority to allow ongoing

discovery pertaining to claims that remained with that court, subject of course,

to the circuit court's exercise of its broad discretion over the scope of such

discovery matters.

      Even though the trial court was authorized to permit ongoing discovery,

nevertheless, it is clear that the trial court's abatement of discovery pending

the appeal will not result in a "great injustice and irreparable injury . . . if the


                                          11
petition is not granted." Trial courts are conferred with broad discretion in

managing discovery in light of the unique factors present in any particular

case. Sexton v. Bates, 41 S.W.3d 452 (Ky. App. 2001) ("It is a well established

principle that a trial court has broad discretion over disputes involving the

discovery process."). Under these circumstances the circuit court acted well

within its discretion in deciding to hold further discovery in abeyance pending

the resolution of the appeal. There was no great injustice associated with the

stay.

        Nor is there an irreparable injury connected with the stay. There is no

indication that if the stay is not lifted the documents requested in Kentucky

Spirit's discovery effort will not be readily available for disclosure upon

resolution of the pending appeals. Kentucky Spirit has failed to explain how it

will be prejudiced if discovery is abated until resolution of the appeals. A writ

of prohibition "is an extraordinary remedy," that Kentucky courts "have always

been cautious and conservative both in entertaining petitions for and in

granting such relief." Bender v. Eaton, 343 S.W.2d 799, 800 (Ky. 1961). The

trial court's order temporarily abating discovery does not implicate the need for

an extraordinary remedy; nor will it result in a great injustice or an irreparable

injury.

        And finally, we believe that the Court of Appeals and Kentucky Spirit

have misplaced their reliance upon Weddle and Rehm to strike down the circuit

court's order as an indefinite stay on discovery without a pressing need. In

Rehm, an asbestos exposure case involving multiple defendants, the circuit

                                         12
court stayed discovery following summary judgment as to some of the

defendants; the plaintiffs sought to continue discovery as to the remaining

defendants. In holding that the plaintiffs were entitled to a writ allowing them

to continue with discovery, we held that lallthough Appellants cannot identify

specific persons' testimony that will be lost or the evidence that will disappear,

they are not required to do so. Information and evidence now available may be

lost as a result of the discovery stay, and that is sufficient." Rehm, 132 S.W.3d

at 868 (internal quotes omitted).

      Similarly, Weddle holds that the Court of Appeals erred in declining to

issue a writ of mandamus to compel the trial court to vacate a stay order,

reasoning that the trial court had acted without articulating any urgency for

abating the case, and because the issuance of the stay order resulted in

irreparable injury with no adequate remedy by appeal. Also in this vein, in

Volvo Car Corp. v. Hopkins, 860 S.W.2d 777 (Ky. 1993), we held that in the

context of a sudden acceleration lawsuit that the petitioner was entitled to a

writ because the delay involved in awaiting final disposition of the case before

addressing the erroneous discovery ruling would likely result in losing

discoverable information from witnesses who may have died, or moved, or

whose memories might be dimmed by time.

      As we recently explained in Inverultra, S.A. v. Wilson, --- S.W.3d ---, 2014

WL 7238373, *5-*6 (Ky. 2014), Volvo and Rehm both purport to rely on

Meredith v. Wilson, 423 S.W.2d 519 (Ky. 1968), a case in which our predecessor

Court granted mandamus and reversed a discovery stay. The analysis in


                                        13
Meredith, however, was not based on a generalized concern that information

could conceivably be lost. Id. It was based upon the determination that

because "in the circumstances of this case" there was an apparently real risk

that "information and evidence now available may be lost in the event of the

death of either of the witnesses sought to be interrogated." 423 S.W.2d at 520.

Thus, Meredith reflects the sensible holding that a genuine exigency might well

call into question the adequacy of an appeal. Inverultra at *5-*6. Cf. Texaco,

Inc. v. Borda, 383 F.2d 607, 609 (3rd Cir. 1967) (denying mandamus relief from

a discovery stay except allowing the deposition of the seventy-one year old

plaintiff). See also, Landis v. North American Co., 299 U.S. 248, 255 (1936)

(Cardozo, J.) ("the suppliant for a stay must make out a clear case of hardship

or inequity in being required to go forward, if there is even a fair possibility that

the stay for which he prays will work damage to someone else, [and] .. . [o]nly

in rare circumstances will a litigant in one cause be compelled to stand aside

while a litigant in another settles the rule of law that will define the rights of

both.").

       In each of these cases where mandamus relief was granted, however, the

potential evidence at risk exceeded a mere request for pre-existing documents

housed at a known and secure location. Rather, in those cases the discovery

requests implicated information realistically subject to loss or destruction, and

to witnesses' fading memories, the dispersal of witnesses, and perhaps even

their deaths. None of these concerns are alleged in Kentucky Spirit's document




                                          14
request dispute; as noted above, there is simply no realistic danger of the loss

of the subject governmental documents.

      Obviously, some orders abating discovery may cause irreparable injury

and some may not Any reading of Rehm, Weddle, and Volvo that there is a

presumption of irreparable damage is misguided.       Rehm, Weddle, and Volvo,

therefore, represent a very narrow exception restricting a circuit court's

discretion to abate discovery which is applicable only when there is a realistic

chance of a party losing crucial evidence possessed by witnesses whose

accounts may otherwise be lost if discovery is unduly delayed pending

appellate procedures. As explained, that is simply not the case here. As such,

we conclude that the Court of Appeals', and the Cabinet's, reliance on this line

of cases is misplaced under the facts of this case.   See Inverultra, at *5-*6.


                                  IV. CONCLUSION

      Because the circuit court did not abuse its discretion by temporarily

staying discovery pending the resolution of matters pertaining to the partial

summary judgment in the appellate courts, we therefore vacate the writ of

prohibition issued by the Court of Appeals and remand the proceeding for entry

of an order denying Kentucky Spirit's petition for a writ of prohibition.

      Minton, C.J., Abramson, Cunningham, Keller, Noble and Venters, JJ.,

sitting. All concur.




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COUNSEL FOR APPELLANTS:

Kenneth Allen Bohnert
Richard M. Sullivan
Scott Alan Johnson
Conliffe, Sandmann 85 Sullivan


COUNSEL FOR APPELLEE HON. THOMAS D. WINGATE, JUDGE, FRANKLIN
CIRCUIT COURT:

Hon. Thomas Dawson Wingate

COUNSEL FOR APPELLEE KENTUCKY SPIRIT HEALTH PLAN, INC.:

Philip Wallace Collier
Bethany A. Breetz
Stites 86 Harbison, PLLC

Christopher Flynn
Crowell 86 Moring, LLP




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