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A Philadelphia judge has certified a class of lawyers in a suit that alleges a company that retrieves records from Pennsylvania hospitals charged them rates in excess of the maximums permissible under Pennsylvania’s Medical Records Act. In allowing certification as to the attorney plaintiffs in McShane v. Recordex Acquisition Corp., Common Pleas Judge Mark I. Bernstein denied the motion to certify the proposed class of personal injury plaintiffs on whose behalf the attorneys had sought the records in question from defendant Recordex. According to Bernstein’s opinion, both sides agreed that Recordex — which provides records from numerous Philadelphia hospitals — would obtain records from hospitals electronically and then charge the maximum rate permitted under the Medical Records Act for copies from microfilm, as opposed to the lower maximum rate for paper copies. The Medical Records Act, which took effect in 1998, sets maximum per-page medical records copy rates for both paper and microfilm copies, Bernstein’s opinion states. Class counsel Alan Feldman of Feldman Shepherd Wohlgelernter & Tanner said that the case could benefit plaintiffs and defendants alike. “There was no microfilm involved,” Feldman said, adding later, “Recordex’s actions have really harmed the citizens of Pennsylvania by making them pay exorbitant charges for records whose fees are controlled by statute.” As class counsel, the Feldman Shepherd firm is excluded from the class by Bernstein’s ruling. The firm had represented named client plaintiff Karen McShane. McShane and the other client plaintiffs were parties in personal injury actions in which their attorneys were billed the higher microfilm copy rates when their lawsuits were resolved, the opinion states. The law firm Liss & Marion — designated by Bernstein as the attorneys’ class representative — paid the microfilm rate on medical records copies they purchased on behalf of their clients, according to the opinion. “As defendant correctly stated in its memorandum contra certification,” Bernstein wrote, “‘any of the claims of the McShanes — or any other clients of firms included in the alleged class — would simply be derivative of the claims of the lawyers.’ There is no evidence of any direct orders for records from or allegedly excessive billing to any individual plaintiffs. … All reimbursements, should there be any, will be necessarily made through the appropriate law firm.” The opinion notes that according to Pennsylvania case precedent, meeting the five prerequisites to class certification does not represent a heavy burden. “Our Superior Court has instructed that it is a strong and oft-repeated policy of this commonwealth that decisions applying the rules for class certification should be made liberally and in favor of maintaining a class action,” Bernstein wrote in his July 9 opinion. Bernstein concluded that the attorney plaintiffs had met the five conditions of class certification under Pennsylvania law: numerosity, commonality, typicality, adequacy of representation, and fair and efficient method of adjudication. Bernstein wrote that the numerosity requirement was satisfied because the plaintiffs showed that so many potential class members exist that joinder would be impractical: one plaintiffs’ exhibit showed that more than 700,000 pages of electronically obtained medical records were billed at the microfilm rate. As for commonality, Bernstein found that individual issues of law and fact did not exist, as Recordex had asserted; similarly, he concluded that the typicality condition had been met because the experience of the law firm class representative was typical of that of the other law firm plaintiffs. Turning to the adequacy of representation requirement, Bernstein found that the named class representative’s interests do not conflict with those of the proposed class. And on the fifth condition, Bernstein concluded that a class action would provide a fair and efficient method for adjudication of the controversy. “[In this case], the amounts claimed will vary tremendously,” Bernstein wrote. “Some sole practitioners in Philadelphia may have only one ‘overbilling’ which may amount to only a few dollars. Other large law firms may be owed thousands of dollars over the several years involved in obtaining records from 16 major hospitals. For many class members the amounts involved may not warrant individual litigation and thus class litigation is the only remedy. For other class members the amounts may be substantial.” Bernstein ordered the parties to offer proposals for notification of potential class members. Feldman said that determining class members would likely involve reviewing invoices and other records kept by Recordex. In the underlying McShane case — which was a wrongful death action stemming from the death of a child in an auto accident — Recordex charged the Feldman Shepherd firm for medical records copies at the microfilm rate, resulting in a bill that was more than two times what the firm would have been charged for paper, according to Thomas More Marrone, who is handling the case with Feldman. In 2002, Marrone said, the underlying McShane case generated 113 pages of medical records copies. The firm was charged $183.06 under the microfilm rate. Under the paper copy rate for that year (the rates under the Medical Records Act are adjusted for inflation), the firm would have owed Recordex $69.44, according to Marrone. Feldman said that Bernstein’s decision not to certify both proposed classes does not hurt the plaintiffs’ case. “[In proposing two classes], we wanted to make sure that we weren’t confronted with the argument that, for example, the real party at interest was the client, as opposed to the law firm,” Feldman said. Recordex has not yet changed its billing practices, according to Marrone. The plaintiffs’ suit seeks a declaration from the court that Recordex desist from billing at the rates in dispute. The plaintiffs are not seeking a separate injunction hearing to address that issue before McShane concludes, Marrone said. Recordex’s attorney, Don Foster of Klehr Harrison Harvey Branzburg & Ellers, declined to comment on Bernstein’s opinion as he had not yet fully discussed the ruling with his client. Recordex is currently considering whether to apply for permission to appeal the ruling, Foster said.

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