Spiro v. Healthport Techs., LLC
| Decision Date | 29 August 2014 |
| Docket Number | No. 14 Civ. 2921PAE.,14 Civ. 2921PAE. |
| Parties | Charles SPIRO; Ann Marie Spiro; Ismael Torres, as Administrator of the Estate of Kerryann Torres, Deceased; and Tatyana Ruzhinskaya, as Administratrix of the Estate of Marina Rochniak, Deceased, individually and on behalf of others similarly situated, Plaintiffs, v. HEALTHPORT TECHNOLOGIES, LLC; Montefiore Medical Center; Mount Sinai Hospital; and Beth Israel Medical Center, Defendants. |
| Court | U.S. District Court — Southern District of New York |
Edward Seth Goodman, Steven Lester Hess, Simonson Hess Leibowitz & Goodman, P.C., Rebecca M. Katz, Motley Rice LLC, New York, NY, Mathew P. Jasinski, William H. Narwold, Motley Rice LLC, Hartford, CT, for Plaintiffs.
Rebecca Anne Brazzano, Thompson Hine LLP, New York, NY, Seth A. Litman, Thompson Hine LLP, Atlanta, GA, for Defendants.
This case is a putative class action lawsuit filed on behalf of all persons in New York who requested copies of their medical records from Healthport Technologies, LLC (“Healthport”), Montefiore Medical Center (“Montefiore”), Mount Sinai Hospital (“Mount Sinai”), and Beth Israel Medical Center (“Beth Israel”) (collectively, “defendants”). Plaintiffs allege that defendants overcharged for such copies. Plaintiffs bring three claims for money damages: under New York Public Health Law § 18, which sets a ceiling on such fees; under New York General Business Law § 349, which prohibits deceptive trade practices; and for unjust enrichment. In a fourth claim, plaintiffs seek injunctive relief.
On April 25, 2014, Healthport removed this case from the Supreme Court of the State of New York, New York County, on the grounds that this Court had original jurisdiction under the Class Action Fairness Act, 28 U.S.C. § 1332(d) ( “CAFA”). Defendants then moved, in separate motions, to dismiss the First Amended Complaint (Dkt. 19) (“FAC”) under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). Defendants argue that: (1) plaintiffs lack standing; (2) the FAC fails to state a claim upon which relief may be granted; and (3) certain claims are barred by the statute of limitations.
For the reasons that follow, the Court dismisses the FAC in its entirety. The dismissal is with prejudice, with one exception: Plaintiffs are granted leave to file a Second Amended Complaint, but this leave is limited to the claims for money damages brought by plaintiff Tatyana Ruzhinskaya (“Ruzhinskaya”), as administratrix of the estate of Marina Rochniak (“Rochniak”), against defendants Healthport and Beth Israel.
The named plaintiffs in this action are: Charles Spiro and Ann Marie Spiro (“Spiro”); Ismael Torres, as administrator of the estate of Kerry–Ann Torres (“Torres”); and Ruzhinskaya, as administratrix of Rochniak's estate. See FAC. The named plaintiffs purport to represent a class of similarly situated individuals, defined as:
All persons including patients, their legal representatives and qualified persons within the scope and meaning of Public Health Law ¶ 18, who requested copies of medical records from the defendants herein and/or any other physician, hospital, or health care provider as defined in said statute ... in the State of New York, and were billed for said copies a charge in excess of the actual cost incurred by defendants for copying said records including, but not limited to, fees at, about or in excess of the statutory maximum or “ceiling” rate of seventy-five cents ($0.75) per page, and who sustained damages as a result of said overcharging for medical records by defendants, its agents or representatives.
Defendants Mount Sinai, Montefiore, and Beth Israel are hospitals; each qualifies as a “healthcare provider” or “provider” under New York Public Health Law § 18. Id. ¶ 6. Healthport is not a healthcare provider. Id. However, the FAC alleges that Healthport acted as the agent of the three hospitals “for the purpose of copying, furnishing and billing for medical records in response to requests made ... by [their] patients and qualified persons acting on their behalf[.]” Id. ¶ 78 (emphasis added); see also id. ¶¶ 91, 103. It alleges, in essence, that the three hospitals outsourced their copying of medical records to Healthport.
The named plaintiffs here2 were each previously represented by the law firm of Simonson Hess Leibowitz & Goodman, P.C. (“Simonson”) in connection with personal injury lawsuits brought in New York State court.3 In the course of each of those representations, Simonson requested and received, on behalf of its client, copies of that client's medical records from one of the hospital defendants named in this lawsuit. See id. ¶¶ 75–115; see also Brazzano Decl. Ex. A. It is those requests that form the basis of each plaintiff's claim to have been overcharged for such copies. Specifically, the FAC alleges that:
As noted, the Simonson firm made these requests for medical records while representing plaintiffs in personal injury lawsuits. See id. ¶¶ 87, 101, 113. Simonson paid the bills for copying each client's medical records: For Spiro, it paid the $74.00 bill on January 28, 2011, id. ¶ 84; for Torres, it paid the $28.25 bill on February 25, 2010, id. ¶ 97; and for Rochniak, it paid the $140.75 bill on July 8, 2013, id. ¶ 110. See also Brazzano Decl. Ex. A. These lawsuits, in turn, settled on February 29, 2012 (Spiro), September 13, 2012 (Torres), and July 12, 2013 (Rochniak). Following each settlement, each plaintiff reimbursed Simonson for his or her “share of the case disbursements ... associated with the case,” including the cost of copying medical records. FAC ¶¶ 88, 101, 114. Spiro did so on April 12, 2012, id. ¶ 88; Torres, on January 22, 2013, id. ¶ 101; and Rochniak, on October 4, 2013, id. ¶ 114.
Based on these facts, each plaintiffs alleges that he or she suffered damages from “being caused to pay fees for the medical records in excess of the legally permissible rate,” id. ¶ 115, which, plaintiffs claim, was limited to the actual costs of photocopying.
On March 12, 2014, plaintiffs filed the original Complaint in this case in the Supreme Court of New York in Manhattan. Dkt. 2. On April 25, 2014, Healthport removed the case to this Court, see id.; on May 2, 2014, it moved to dismiss the Complaint, see Dkt. 5.
On May 27, 2014, plaintiffs filed the FAC. Dkt. 19. It brings claims (1) under N.Y. Public Health Law § 18 (“Count One”); (2) under N.Y. General Business Law § 349 (“Count Two”); (3) for unjust enrichment (“Count Three”); and (4) for injunctive relief (“Count Four”), in each case based on a claim that plaintiffs were overcharged for copies of their medical records.
On June 10, 2014, Healthport submitted a renewed motion to dismiss, Dkt. 25, and an accompanying memorandum of law, Dkt. 26 (“Healthport Br.”). The same day, Mount Sinai and Beth Israel (collectively, “the hospital defendants”) submitted a memorandum of law in support of their motion to dismiss, Dkt. 22 (“Hospital Br.”), as did Montefiore, see Dkt. 29 (“Montefiore Br.”). On June 24, 2014, plaintiffs submitted a brief in opposition to all three motions to dismiss. Dkt. 33 (“Pl. Br.”). On July 1, 2014, defendants submitted their reply briefs. See Dkt. 35 (“Hospital Reply Br.”), 36 (“Healthport Reply Br.”), 37 (“Montefiore Reply Br.”).
Defendants move to dismiss the FAC on three grounds. First, defendants seek dismissal under Rule 12(b)(1), on the ground that plaintiffs lack standing to bring this suit. Second, defendants seek dismissal under Rule 12(b)(6) for failure to state a claim. Third, Mount Sinai and Healthport assert that plaintiff Spiro's claims should all be dismissed as time-barred. The Court addresses each argument in turn.
Because it is jurisdictional, the Court first considers defendants' argument that plaintiffs lack standing. See Rhulen Agency, Inc. v. Ala. Ins. Guar. Ass'n, 896 F.2d 674, 678 (2d Cir.1990) () (citation omitted); Wong v. CKX, Inc., 890 F.Supp.2d 411, 414 (S.D.N.Y.2012) () (citation omitted).
“[A] claim is ‘properly dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) when the district court lacks the statutory or constitutional power to adjudicate it.’ ” Arar v. Ashcroft, 532 F.3d 157, 168 (2d Cir.2008) (quoting Makarova v. United States,
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