Chartone, Inc. v. Raglon

• Citation: 283 S.W.3d 576,373 Ark. 275
• Decision Date: 24 April 2008
• Docket Number: No. 07-940.,07-940.
• Parties: CHARTONE, INC., Appellant, v. Roosevelt RAGLON, Appellee.
• Court: Supreme Court of Arkansas

283 S.W.3d 576

373 Ark. 275

CHARTONE, INC., Appellant, v. Roosevelt RAGLON, Appellee.

No. 07-940.

Supreme Court of Arkansas.

April 24, 2008.

Rose Law Firm, a Professional Association, by: Amy Lee Stewart and Byron J. Walker, Little Rock, AR, for appellant.

Thrash Law Firm, by: Thomas P. Thrash, Little Rock, AR; and Wood Law Office, P.A., by: Russell A. Wood, Russellville, AR, for appellee.

DONALD L. CORBIN, Justice.

Appellant ChartOne, Inc., appeals the order of the Jefferson County Circuit Court granting Appellee Roosevelt Raglon's motion for class certification pursuant to Ark. R. Civ. P. 23. On appeal, ChartOne argues that the trial court erred in granting class certification because (1) the class definition presents no feasible means for identifying class members; (2) there is no statutory prohibition against ChartOne charging a fee for the service of mailing records; and (3) Raglon failed to sustain his burden of proof with regard to the requirements of predominance, superiority, and typicality. This court assumed jurisdiction of this case pursuant to Ark. Sup.Ct. R. 1-2(d). We affirm.

Facts

ChartOne is a health-information management company that provides copying services of medical records for doctors, hospitals, and other medical-care providers throughout Arkansas. Raglon, who had requested and paid for a copy of his medical records, filed his first amended complaint against ChartOne on February 5, 2007. The complaint alleged that ChartOne charged fees in excess of those allowed by statute for copying medical records and also charged for shipping and postage that it either did not incur or was reimbursed for by the medical-care provider. Raglon alleged that ChartOne's actions constituted a statewide deceptive practice in violation of Ark.Code Ann. § 16-46-106 (Repl.1999),¹ the Arkansas Deceptive Trade Practices Act (ADTPA), codified at Ark.Code Ann. §§ 4-88-101 to -115 (Repl.2001), and common law. Raglon sought to bring the action on his own behalf, as well as all those similarly situated, requesting that the court certify the matter as a class action, with Raglon as the named representative. Raglon requested declaratory and injunctive relief under the ADTPA and sought compensatory and punitive damages, as well.

ChartOne opposed Raglon's motion for class certification, arguing that the proposed class definition was ambiguous and contained no objective criteria by which to ascertain the members of the class. In addition, ChartOne argued that Raglon failed to sustain his burden of proving that the six required elements for certifying a class action under Rule 23 had been satisfied.

The circuit court held a hearing on the motion for class certification on April 5, 2007. At the hearing, Tonya Jones, a corporate representative for ChartOne, testified regarding ChartOne's billing practices in Arkansas. Specifically, Jones testified that it was unclear whether base charges or clerical charges were actually notary fees. Jones went on to state that ChartOne did not maintain any records to show whether a notary was requested or charged and that the company would have to pull every request ever received to determine if a notary service was requested. With regard to the data sheets maintained by ChartOne, Jones testified that they contained all the information that is on an invoice, including clerical fees, base fees, the date of the charges, who the invoice is sent to, the amount paid, the amount billed, and the number of pages copied. Jones also testified that within the last six years, ChartOne had billed its customers a percentage of the invoice for shipping and handling. Finally, she stated that some medical providers did reimburse ChartOne for postage.

At the conclusion of the hearing, the circuit court took the motion for class certification under advisement. In an order dated June 5, 2007, the circuit court granted Raglon's motion for class certification and defined the class as

[a]ny person designated by ChartONE as (a) a "patient"; or (2) "attorney," including Plaintiff and all similarly situated persons, from the period of time beginning on January 1, 1994 to the present ("Class Period") who requested a copy of medical records from a healthcare provider located in Arkansas and who paid ChartONE (1) base fees, clerical fees, retrieval fees and/or page fees as part of a charge for copying medical records, which resulted in charges being in excess of $5 for the first five pages and 25¢ for each page thereafter; and/or (2) shipping charges.

Excluded from the class are the agents, affiliates and employees of the Defendant and the assigned judge and his/her staff, and members of the appellate court and their staff.

The circuit court concluded that the above-stated definition was sufficient to objectively identify members of the class. Additionally, the court concluded that the requirements of Rule 23 had been satisfied. From that order, comes the present appeal.

Standard of Review

At the outset, we note that certification of a lawsuit as a class action is governed by Rule 23. Circuit courts are given broad discretion in matters regarding class certification, and we will not reverse a circuit court's decision to grant or deny class certification absent an abuse of discretion. See Teris, LLC v. Golliher, 371 Ark. 369, 266 S.W.3d 730 (2007); Asbury Auto. Group, Inc. v. Palasack, 366 Ark. 601, 237 S.W.3d 462 (2006). When reviewing a circuit court's class-certification order, this court reviews the evidence contained in the record to determine whether it supports the circuit court's decision. Id. This court does not delve into the merits of the underlying claims at this stage, as the issue of whether to certify a class is not determined by whether the plaintiff has stated a cause of action for the proposed class that will prevail. See Am. Abstract & Title Co. v. Rice, 358 Ark. 1, 186 S.W.3d 705 (2004).

Rule 23 provides in relevant part:

(a) Prerequisites to Class Action. One or more members of a class may sue or be sued as representative parties on behalf of all only if (1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties and their counsel will fairly and adequately protect the interests of the class.

(b) Class Actions Maintainable. An action may be maintained as a class action if the prerequisites of subdivision (a) are satisfied, and the court finds that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy. At an early practicable time after the commencement of an action brought as a class action, the court shall determine by order whether it is to be maintained. For purposes of this subdivision, "practicable" means reasonably capable of being accomplished. An order under this section may be altered or amended at any time before the court enters final judgment. An order certifying a class action must define the class and the class claims, issues, or defenses.

Under Rule 23, the following six requirements must be met before a lawsuit can be certified as a class action: (1) numerosity, (2) commonality, (3) typicality, (4) adequacy, (5) predominance, and (6) superiority. See Teris, 371 Ark. 369, 266 S.W.3d 730. Having set forth our standard of review, we now turn to the points on appeal.

I. Class Definition

For its first point on appeal, ChartOne argues that the trial court erred in granting the motion for class certification, because the class definition presents no feasible means for ascertaining the members of the class. Specifically, ChartOne argues that the class as defined suffers the fatal defect that the circuit court cannot determine in any reasonable or feasible manner which of ChartOne's customers are class members. In advancing this argument, ChartOne states that such a determination cannot be made because there is no way of ascertaining the per-page charges without reviewing the actual requests for records that are stored with the patients' medical files, mainly because it is unable to determine if a notary fee was charged or not. ChartOne further avers that it is simply not feasible to conduct a file-by-file review of confidential medical records that could number over 120,000 files. Raglon counters that class members can be identified by objective criteria, including ChartOne's own billing records. With regard to the notary-fee issue, Raglon avers that any issue that may arise regarding a notary fee is a damages issue and does not render the class definition defective. We agree with Raglon.

In addressing the issue of class definition, this court has recently said:

It is axiomatic that in order for a class action to be certified, a class must exist. The definition of the class to be certified must first meet a standard that is not explicit in the text of Rule 23, that the class be susceptible to precise definition. This is to ensure that the class is neither "amorphous," nor "imprecise." Concurrently, the class representatives must be members of that class. Thus, before a class can be certified under Rule 23, the class description must be sufficiently definite so that it is administratively feasible for the court to determine whether a particular individual is a member of the proposed class. Furthermore, for a class to be sufficiently defined, the identity of the class members must be ascertainable by reference to objective criteria.

Teris, 371 Ark. at 373, 266 S.W.3d at 733 (quoting Van Buren Sch. Dist. v. Jones, 365 Ark. 610, 614, 232 S.W.3d 444, 448 (2006)). We further pointed out in Teris that clearly defining the class ensures that those people who...