Commercial Litigation and Arbitration

RICO — Neither Attorneys’ Fees Nor Cost of Surgeries Nor Injury to Intangible Interest in Personal Medical Information Constitute Concrete or Quantifiable Injury to Business or Property within § 1964(d) — Declaratory Relief Discretionary

Dickerson v. TLC The Laser Eye Center Institute, Inc., 2012 U.S. App. LEXIS 17395 (4th Cir. Aug. 15, 2012);

Charles Benjamin Dickerson appeals the district court's grant of motions to dismiss the first amended complaint ("FAC") filed by Appellees TLC Lasik Centers, TLC Clinical Directors, TLC LASIK Surgeons, and TLC Management (collectively, "the Providers"). Dickerson is the class representative in an action alleging violations of the Racketeer Influenced and Corrupt Organization Act ("RICO") and requesting declaratory and injunctive relief regarding his and the putative class members' medical records that were allegedly concealed and converted by the Providers. Dickerson alleged that the Providers participated in an elaborate fraudulent scheme to conceal their medical malpractice. For the following reasons, we affirm the district court's grant of the motions to dismiss.***

*** To establish a RICO claim, Dickerson must sufficiently allege facts that if accepted as true demonstrate that the Providers engaged in "(1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity." Sedima v. Imrex Co., 473 U.S. 479, 496 (1985). Dickerson can only recover if he shows that his injury caused by the RICO violation damaged his business or property. Id. See also, 18 U.S.C. § 1964(c). Thus, any allegation of personal injuries and losses from those injuries will not be considered injuries to business or property under the act. Bast v. Cohen, Dunn & Sinclair, P.C., 59 F.3d 492, 495 (4th Cir. 1995). The district court concluded that the FAC sufficiently alleged a pattern of racketeering activity and the existence of an enterprise. *** It dismissed the RICO claim, however, because it found that the FAC did not allege a cognizable injury caused by the RICO activity to Dickerson's business or property. ***

In the FAC, Dickerson pled several injuries to his and the class members' properties caused by the Providers' alleged RICO activity. With respect to the first injury, the district court correctly concluded that costs and attorney fees are automatically granted in a successful RICO case, and thus these damages are separate from the damages arising from the injury to a plaintiff's business or property. See 18 U.S.C. § 1964(c). Similarly, the district court correctly concluded that, with respect to the second injury, the money spent on subsequent surgeries and treatment were damages stemming from personal injuries derived from the Providers' medical malpractice and not — as Dickerson alleged — damages arising from an injury to his property.

Finally, with respect to the third injury, the district court concluded that under South Carolina law, Dickerson had an "intangible property interest" in his medical information, yet conversion of this interest was not a legally cognizable action. J.A. 303. As a result, it held that Dickerson could not demonstrate any "concrete" or "quantifiable" injury to his business or property. ***

Because the medical records belong to the physicians who possess them and the law merely affords patient's access to copies of their records, the district court was correct to conclude that a claim of conversion with respect to the medical records could not be maintained.***

For the following reasons, we affirm the district court's dismissal of Dickerson's requests for declaratory and injunctive relief. With respect to the request for declaratory relief, Dickerson's argument on appeal is not responsive to the district court's determination that the proper avenue for requesting medical records given the disposition of this case is through a discovery motion. It is within the discretion of the district court to grant declaratory relief and such relief is appropriate "when the judgment will serve a useful purpose in clarifying and settling the legal relations in issue, and . . . when it will terminate and afford relief from the uncertainty, insecurity, and controversy giving rise to the proceeding." Centennial Life Ins. Co. v. Poston, 88 F.3d 255, 256 (4th Cir. 1996) (internal quotation marks omitted). Here, the district court gave a well-reasoned answer for why a declaration was "ill suited" to determine whether Dickerson and the putative class members were entitled to the disclosure of the medical records. Alternatively, dismissal of the claim for declarative relief is warranted because of the dismissal of Dickerson's RICO claim.

With respect to the request for injunctive relief, Dickerson now claims that his request for injunctive relief was only predicated on the RICO violation despite the fact that the FAC's pleadings explicitly assert HIPAA violations. As determined above, Dickerson has not sufficiently pled a RICO claim, and consequently he cannot be entitled to injunctive relief on this basis.

Share this article:


Recent Posts