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Smith v. RecordQuest LLC

This case law update has brought to you by Freeway Law, personal injury and motor vehicle crash lawyers. The following is not one of our cases, but it is of some significance, and we thought we should share it with our readers for informational purposes. The information below is for informational purposes only and not to be construed as legal advice.

Court: US Court of Appeals for the Seventh Circuit

Docket: 19-2084

Opinion Date: February 26, 2021

Judge: Brennan

Areas of Law: Civil Procedure, Health Law, Personal Injury

Smith suffered an injury from a car accident, retained an attorney for a personal injury lawsuit and authorized her attorney to obtain her healthcare information. The attorney requested Smith’s medical records from MHS, on three occasions. RecordQuest, not MHS, answered those requests and charged Smith’s attorney (who paid on her behalf) a $20.96 handling fee and an $8.26 certification fee each time. Smith brought a class action, alleging these charged fees contravened the permissible fee schedule set out in Wis. Stat. 146.83(3f)(b) for healthcare records requests and resulted in the unjust enrichment of RecordQuest. The district court dismissed both claims, reasoning that the statute imposes a duty upon only healthcare providers.” RecordQuest is not a healthcare provider but is the agent of MHS; “no principle of agency law holds that a principal’s liability is imputed to the agent when the agent performs the act that results in the principal’s liability.” Smith’s unjust enrichment claim failed because any unjust benefit that Smith allegedly conferred to RecordQuest belonged to MHS. The Wisconsin Court of Appeals subsequently expressly disagreed with the district court’s analysis of Smith’s statutory claim. The Seventh Circuit reversed the dismissal of the statutory claim but affirmed as to Smith’s unjust enrichment claim. Under section 146.83(3f)(b), Smith has a remedy at law for any “injustice” that allegedly resulted from excessive payments; the equitable remedy of unjust enrichment is derivative of and predicated upon the statutory claim.

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