United States District Court, E.D. Kentucky, Northern Division
EDWARD P. GEARHART, Individually and On Behalf of Others Similarly Situated, PLAINTIFF,
EXPRESS SCRIPTS, INC., DEFENDANT.
MEMORANDUM OPINION AND ORDER
R. Wilhoit, Jr., United States District Judge.
matter is before the Court upon Defendant's Partial
Motion to Dismiss [Docket No. 28]. The motion has been fully
briefed by the parties [Docket Nos. 29 and 30]. For the
reasons set forth herein, the Court will sustain the motion.
Edward Gearhart filed this putative class action against
Express Scripts claiming that Express Scripts charged him in
excess of the statutory limit for a copy of his prescription
records. In his Third Amended Complaint, Plaintiff alleges as
follows: Express Scripts is a "pharmacy benefit
management company." [Docket No. 27, Third Amended
Complaint, ¶ 26]. A pharmacy benefit manager is a
third-party administrator of prescription drug programs that
acts as an intermediary between retail pharmacies and health
benefits providers. Id. ¶¶ 23-24.
Plaintiff, a Kentucky resident, alleges that he
"requested his medical records, through his agent, Jones
Ward PLC, from Express Scripts." Id.
¶¶ 7, 22. In May 2014, as part of a products
liability case in which Gearhart was a plaintiff, Jones Ward
requested a copy of his prescription claims data from Express
Scripts in its capacity as the pharmacy benefit manager for
Plaintiffs health plan. Id. ¶¶ 22-24. In
exchange for a $75 fee, Express Scripts compiled information
from its database of claims it maintains for a "network
of retail pharmacies" and provided Jones Ward with a
report listing Plaintiffs various prescription claims.
Id. Jones Ward, understanding that Express Scripts
charged $75 for "processing" the detailed
information from various pharmacies included in the report,
paid the fee. Id. ¶¶ 22, 26. Plaintiff did
not pay Express Scripts or Jones Ward for this statement of
prescription pharmacy claims. Id. ¶¶ 22,
then filed this lawsuit against Express Scripts, on behalf of
a purported class of Kentucky citizens, for Express
Scripts' alleged practice of overcharging customers who
authorize a third party to request a copy of their
prescription claims data on his or her behalf. The third
iteration of his complaint alleges claims for violation of
the Kentucky Consumer Protection Act, KRS § 367.170,
et seq. (Count I), fraud (Count II), unjust
enrichment (Count III), violation of Kentucky Health Records
Law, KRS § 422.317(1) (Count IV), fraud under the Health
Insurance Portal and Accountability Act ("HIPAA"),
45 C.F.R. § 160.103 (Count V), breach of contract (Count
seeks dismissal of Counts V and VI.
scrutinizing a complaint under Rule 12(b)(6), the Court is
required to "accept all well-pleaded factual allegations
of the complaint as true and construe the complaint in the
light most favorable to the plaintiff." Dubay v.
Wells, 506 F.3d 422, 426 (6th Cir.2007). It must allege
more than "a formulaic recitation of the elements of a
cause of action." Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A
complaint will withstand a motion to dismiss if it
"contain[s] sufficient factual matter, accepted as true,
to state a claim to relief that is plausible on its
face." Ashcroft v. Iqbal, 556 U.S. 662, 129
S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). A complaint has
"facial plausibility" if the plaintiff pleads
factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged." Hensley Mfg. v. ProPride, Inc., 579
F.3d 603, 609 (6th Cir.2009) (quoting Iqbal, 129
S.Ct. at 1949). The "complaint must contain either
direct or inferential allegations respecting all material
elements to sustain a recovery under some viable legal
theory." Bishop v. Lucent Technologies, Inc.,
520 F.3d 516, 519 (6th Cir. 2008) (internal citation
Count V fails to state a claim upon which relief can be
Count V, Plaintiff asserts a fraud claim based exclusively on
an alleged HIPAA violation. However, HIPAA does not confer a
private right of action on an individual. See Young v.
Carran, 289 S.W.3d 586, 588 (Ky. App. 2008) (noting that
"federal courts have uniformly held that HIPAA does not
create a private cause of action"). Nor can Plaintiff
circumvent well settled federal law by using HIPAA as a basis
for a state law claim, which is precisely what Plaintiff
attempts to achieve in Count V. Id. (citations
does not, and cannot, defend his claim. Although he tries to
cast it as one intertwined with his allegations of violations
of certain Kentucky statutes, it is clear that the fraud
alleged in Count V relies solely upon an alleged violation of
HIPAA. Therefore, there is no viable legal claim alleged in
Count V and it must be dismissed.
Count VI fails to state a claim upon which ...