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Bocage v. Acton Corp.

United States District Court, N.D. Alabama, Southern Division

February 14, 2018

JORDAN BOCAGE, et al., Plaintiffs,
v.
ACTON CORPORATION, et al., Defendants.

          MEMORANDUM OPINION

          R. DAVID PROCTOR UNITED STATES DISTRICT JUDGE

         This matter is before the court on Defendant IM Records, Inc.'s Motion to Dismiss or, in the Alternative, to Strike the Class Definition (Docs. # 13; 14) and Defendant Acton Corporation's Motion to Dismiss (Doc. # 37). The Motions are fully briefed. (Docs. # 13; 14; 27; 33; 37; 43; 44). On December 14, 2017, the court held a hearing on these Motions. For the reasons explained below, both Motions (Docs. # 13; 37) are due to be granted.

         I. Background

         Plaintiffs allege that they requested medical records from Defendants and were charged improper search and retrieval fees in violation of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and the Health Information Technology for Economic and Clinical Health Act (the “HITECH Act”). (Doc. # 1). Plaintiff Joel Kelly (“Kelly”) alleges that he requested his medical records from Defendant Acton Corporation (“Acton”) six different times and was charged and paid a $5.00 retrieval fee to Acton for each of his requests. (Id. at ¶ 31-36). Plaintiff Sheila Garrett (“Garrett”) alleges that she requested her medical records from Acton and was charged and paid a $5.00 retrieval fee to Acton for this request. (Id. at ¶ 40). Plaintiff Jordan Bocage (“Bocage”) alleges that she requested her medical records from Defendant IM Records, Inc. (“IM Records”) two different times and was charged and paid a $5.00 search and retrieval fee to IM Records for each of her requests. (Id. at ¶ 42-43).

         On July 18, 2017, Plaintiffs filed this action, seeking damages under Alabama state law claims of unjust enrichment, negligent misrepresentation, fraudulent misrepresentation, breach of implied contract, and conversion. (Doc. # 1). Plaintiffs also seek declaratory and injunctive relief. (Id.). Plaintiffs brought this action on behalf of themselves and a class of similarly situated individuals “who were assessed a ‘retrieval' or ‘search fee' from 2013 to the present from Defendants for the procurement and/or purchase of the protected health information.” (Id. at ¶ 45). IM Records filed its Motion to Dismiss or, in the Alternative, to Strike the Class Definition on October 11, 2017. (Doc. # 13). Acton filed its Motion to Dismiss on November 20, 2017. (Doc. # 37). As appendixes to their motions to dismiss, Defendants Acton and IM Records included copies of each of Plaintiffs' medical records requests, which show that these requests were made by Plaintiffs' attorneys, not by Plaintiffs themselves. (Docs. # 13-1; 37-1).

         II. The Documents Defendants Attached to their Complaint Are Central to Plaintiffs' Claims and Undisputed

         “The district court generally must convert a motion to dismiss into a motion for summary judgment if it considers materials outside the complaint.” Day v. Taylor, 400 F.3d 1272, 1275-76 (11th Cir. 2005) (citing Fed.R.Civ.P. 12(b)). However, a “court may consider a document attached to a motion to dismiss without converting the motion into one for summary judgment if the attached document is (1) central to the plaintiff's claim and (2) undisputed. Id. at 1276. Both of these elements are met here.

         The documents are central to Plaintiffs' claims for at least two reasons. First, Plaintiffs explicitly reference these documents and thereby incorporate these requests and invoices into their Complaint. (Doc. # 1 at ¶ 31-36, 40, 42-43); see Taylor, 400 F.3d at 1276 (explaining that if a “document's contents are alleged in a complaint and no party questions those contents, ” the court may consider the attached document if it is central to the plaintiff's claim). Second, the documents are “at the very heart of” Plaintiffs' claims because Plaintiffs' claims center on whether Plaintiffs were improperly charged (via the referenced invoices attached to Defendants' motions to dismiss) for their medical records requests. See Taylor, 400 F.3d at 1276.

         Plaintiffs do not dispute that Defendants' attached documents are central to Plaintiffs' claims nor do they dispute the authenticity of the documents. Moreover, the documents are accompanied by authenticating affidavits that attest to their accuracy. See Id. (noting that an attached document is “undisputed” if “the authenticity of the document is not challenged”). Rather than directly challenging the centrality and/or authenticity of the documents at issue, Plaintiffs argue that the court must accept the allegations in the Complaint that “each of the individual Plaintiffs requested their [medical records]” as true. (Docs. # 27 at p. 3; 43 at ¶ 3). But, this argument misses the mark. The court need not accept the conclusory allegation that Plaintiffs' individually requested their medical records from Defendants if, in fact, Defendants have put forth undisputed documents -- that are both referenced in Plaintiffs' Complaint and are central to their claims -- showing otherwise. As such, the court may consider these appendixes without converting Defendants' motions to dismiss into motions for summary judgment. See Taylor, 400 F.3d at 1275.

         III. Standard of Review

         The Federal Rules of Civil Procedure require only that the complaint provide “a short and plain statement of the claim showing that the pleaser is entitled to relief.” Fed.R.Civ.P. 8(a)(2). However, the complaint must include enough facts “to raise a right to relief above the speculative level.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). Pleadings that contain nothing more than “a formulaic recitation of the elements of a cause of action” do not meet Rule 8 standards, nor do pleadings suffice that are based merely upon “labels and conclusions” or “naked assertion[s]” without supporting factual allegations. Twombly, 550 U.S. at 555, 557. In deciding a Rule 12(b)(6) motion to dismiss, courts view the allegations in the complaint in the light most favorable to the non-moving party. Watts v. Fla. Int'l. Univ., 495 F.3d 1289, 1295 (11th Cir. 2007).

         To survive a motion to dismiss, a complaint must “state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570. “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Although “[t]he plausibility standard is not akin to a ‘probability requirement, '” the complaint must demonstrate “more than a sheer possibility that a defendant has acted unlawfully.” Id. A plausible claim for relief requires “enough fact[s] to raise a reasonable expectation that discovery will reveal evidence” to support the claim. Twombly, 550 U.S. at 556.

         In considering a motion to dismiss, a court should “1) eliminate any allegations in the complaint that are merely legal conclusions; and 2) where there are well-pleaded factual allegations, ‘assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.'” Kivisto v. Miller, Candield, Paddock & Stone, PLC, 413 Fed. App'x 136, 138 (11th Cir. 2011) (quoting Am. Dental Assn. v. Cigna Corp., 605 F.3d 1283, 1290 (11th Cir. 2010)). That task is context specific and, to survive the motion, the allegations must permit the court based on its “judicial experience and common sense . . . to infer more than the mere possibility of misconduct.” Twombly, 550 U.S. at 556. Further, “courts may infer from the factual allegations in the complaint ‘obvious alternative explanation[s], ' which suggest lawful conduct rather than the unlawful conduct the plaintiff would ask the court to infer.” Am. Dental, 605 F.3d at 1290 (quoting Iqbal, 556 U.S. at 682). If the court determines that well-pleaded facts, accepted as true, do not state a claim that is plausible, the claims are due to be dismissed. Twombly, 550 U.S. at 556.

         IV. Analysis

         Both Defendant Acton and Defendant IM Records argue that (1) all of Plaintiffs' claims are due to be dismissed because medical record requests by attorneys are not subject to the fee restrictions imposed by HIPAA and the HITECH Act and (2) Plaintiffs' misrepresentation claims[1], in particular, are due to be dismissed because (a) Defendants never made an actionable representation to Plaintiffs and (b) Plaintiffs have not plausibly alleged their reliance on any such representations. (Docs. # 14, 37). Defendant IM Records[2] also contends that Plaintiffs' claims are improperly repackaged HIPAA claims for which no private right of action exists. (Doc. # 14). The court evaluates each of these arguments, in turn.

         A. HIPAA and the HITECH Act Restrictions on Charges for Medical RecordsApply to Individuals and ...


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