475 F.Supp.3d 1160
D. Mont.2020Background
- Plaintiffs (Deming, Frasier, McFarland, Griswold) sought three years of their medical records through their attorneys for potential personal-injury claims; requests were processed by vendor Ciox Health on behalf of Montana hospitals.
- Ciox invoiced a $15 flat administrative fee plus per-page charges (either $0.50 or $0.75), sometimes a $2 electronic data archive fee, and occasionally a shipping fee despite electronic delivery; invoices lacked time/labor breakdowns.
- Parties agree Ciox is HIPAA-covered and that HIPAA/HITECH limits (cost-based fees) apply only to patient requests, not third-party requests placed by attorneys.
- Central statutory provision at issue is Mont. Code § 50-16-816 (limits to $0.50 per paper page and up to $15 admin fee); dispute whether that provision independently caps fees, applies to third-party requests, or covers electronic records.
- The court construed Montana statutory structure (Parts 5 and 8) and legislative text/history, concluding § 50-16-816 is definitional, Part 8 does not impose Part 5’s third-party limits, and § 50-16-816 applies only to paper/photocopies.
- Court dismissed all claims with prejudice: Count 1 under § 50-16-816 failed, and the Consumer Protection Act and implied covenant claims collapsed because they rested on the alleged unlawful charges.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does § 50-16-816 independently limit fees for medical records in all circumstances? | § 50-16-816 is a standalone rule requiring reasonable, capped fees in all situations. | § 50-16-816 is definitional; it only explains "reasonable fee" where another provision requires one. | § 50-16-816 is definitional and does not itself impose a universal fee cap. |
| Does Part 8 (Mont.) limit fees for third-party requests (attorney-ordered records)? | Part 8 should be read to impose the same limits as Part 5 and be more restrictive than HIPAA; state limits must apply where federal law is silent. | Part 8 is silent on third-party requests; legislature intentionally limited fees in Part 5 but not in Part 8. | Part 8 does not limit fees for third-party requests; court will not import Part 5 limits into Part 8. |
| Does § 50-16-816 apply to electronic records or only paper/photocopies? | Plaintiff urged discovery to determine if Ciox’s electronic method qualified as a photocopy and thus was covered. | Statute by its terms limits fees per paper page/photocopy and does not address electronic formats. | § 50-16-816 governs paper/photocopies only and does not limit fees for electronic records. |
| Do the Montana Consumer Protection Act and implied covenant claims survive if § 50-16-816 fails? | Those claims rest on Ciox’s alleged unlawful overcharges and thus are viable. | Those claims are derivative of the failed statutory claim and cannot stand independently. | Both claims fail because they are premised on the unsuccessful § 50-16-816 theory. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard: plausibility requirement)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading standard framework for plausibility)
- L.A. Lakers, Inc. v. Fed. Ins. Co., 869 F.3d 795 (9th Cir. 2017) (dismissal appropriate where no cognizable legal theory)
- Ciox Health, LLC v. Azar, 435 F. Supp. 3d 30 (D.D.C. 2020) (HIPAA/HITECH do not cap fees for third-party requests)
- Houston Lakeshore Tract Owners Against Annexation, Inc. v. City of Whitefish, 391 P.3d 86 (Mont. 2017) (statutory construction: plain language and legislative intent govern)
- MC, Inc. v. Cascade City-County Bd. of Health, 343 P.3d 1208 (Mont. 2015) (statutory interpretation requires holistic reading of text and structure)