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FINNEGAN v. UNIVERSITY OF ROCHESTER MED. CTR.

August 7, 1998

JOHN F. FINNEGAN III, Plaintiff, -vs- UNIVERSITY OF ROCHESTER MEDICAL CENTER, a/k/a STRONG MEMORIAL HOSPITAL; CBC COMPANIES, INC., d/b/a CREDIT BUREAU AFFILIATES; and ROCHESTER CREDIT CENTER, INC., a/k/a THE CREDIT BUREAU, INC., Defendants.


The opinion of the court was delivered by: CURTIN

DECISION and ORDER

 CURTIN, District Judge

 INTRODUCTION

 Before the court are defendants' motions to dismiss (Items 6, 10, 19) plaintiff's amended complaint (Item 5) pursuant to Fed. R. Civ. P. 12. Plaintiff has responded (Items 14, 23), and defendants have replied (Items 15, 16, 24). Defendants appeared before this court for oral argument on January 16, 1998, and plaintiff participated by telephone.

 BACKGROUND

 Plaintiff was treated at defendant University of Rochester Medical Center's Strong Memorial Hospital ("Hospital") for a variety of physical and neurological ailments from February through June 1995. Plaintiff was treated by more than ten physicians, technical therapists, and other health care professionals. Plaintiff claims that the cost of these treatments totaled over $ 50,000 (Item 5, Amended Complaint, P 16).

 On or about June 21, 1995, plaintiff felt that defendant Hospital's treatment was not adequate, and so he sought another opinion at somewhere other than defendant Hospital. From June 21, 1995, to March 22, 1996, defendant Hospital billed plaintiff directly for the medical services that it provided to him from February through June 1995 (Item 22, Declaration of Plaintiff, P 7). Many, but not all, of these bills were paid by plaintiff's health insurer, Blue Cross/Blue Shield, and by Medicaid (Item 5, P 16). When plaintiff initially received these bills, he claims that he immediately called defendant Hospital about reconciling his bills (Item 22, P 8).

 Plaintiff explained to Ms. Palmer in the Hospital's Patient Accounts Office that he had filed a claim for disability benefits with the United States Department of Health and Human Services, Social Security Administration, prior to his treatment at the Hospital. While his claim was initially denied and his petition for reconsideration was rejected, plaintiff then explained to Ms. Palmer that his administrative appeal was still pending. Plaintiff claims that as a result of his dialogue with Ms. Palmer and then with Ms. Anna Sheridan, a supervisor in the Patient Accounts Office, defendant Hospital agreed to forbear the collection of any of his accounts until his appeal with the Social Security Administration was resolved (Id.).

 On March 22, 1996, plaintiff received notification that his appeal was successful and that he was adjudged totally disabled. Plaintiff claims that he immediately began to arrange for payment to defendant Hospital when his first Social Security Administration benefits arrived (Id., P 10). However, plaintiff brings this lawsuit because he claims that he learned sometime in April 1996 that defendant Hospital sent his account to be handled by at least two collection agencies, defendant Rochester Credit Center, Inc., d/b/a The Credit Bureau ("RCC"), and defendant CBC Companies, Inc., d/b/a Credit Bureau Affiliates ("CBA"). *fn1" Plaintiff argues that defendant Hospital reneged, as early as December 1995, on its oral agreement to forbear collecting payments until after his appeal was resolved (Id., P 9; Item 5, P 22).

 Plaintiff also claims that on at least two occasions, he paid what he thought was his last bill from defendant Hospital, and then thereafter received another bill for "additional expenses." He states that while he sent at least 15 letters (Item 22, Exh. A) repeatedly asking for a full accounting and disputing the amounts that defendant Hospital claimed wore owed, at no time was he ever given a final statement of account from defendant Hospital. Plaintiff states that he paid defendant Hospital over $ 5,000, but that he should not have paid any of this because his medical treatment was covered by Blue Cross/Blue Shield and Medicaid.

 Plaintiff argues that defendant Hospital acted in bad faith by giving negative reports to credit reporting agencies which resulted in derogatory information appearing on his credit report (Item 5, P 23). In addition, plaintiff claims that on or about December 31, 1996, his attorney obtained a verbal commitment from Hank Fagan, a credit manager at defendant Hospital, to remove the derogatory information from his credit report (Item 5, P 27; Item 22, P 19). However, plaintiff alleges that this verbal commitment was never honored and has caused problems. Plaintiff and his wife have had numerous difficulties in their attempts to purchase a new home due to this wrongfully recorded, negative credit information (Item 5, P 31). Plaintiff claims that defendants' actions have caused him not to get approved for a mortgage that he would otherwise be entitled to and that he has suffered significant physical and emotional injuries.

 Plaintiff claims that defendants RCC and CBA pursued debt collection against him even though he was repeatedly disputing the amount owed. Also, plaintiff claims that both defendants RCC and CBA sent several dunning letters to plaintiff, but that when he spoke with representatives at both collection agencies, no one could verify the accuracy of the amount which was being collected. Supposedly, both defendants RCC and CBA referred plaintiff back to defendant Hospital to confirm the amount that he owed.

 After plaintiff was unable to resolve these problems, he filed his original complaint in this court on May 16, 1997, against defendants Hospital, RCC, and CBA (Item 1). On July 11, 1997, plaintiff amended his complaint as to defendant RCC, because the original complaint only sued "The Credit Bureau, Inc." and not "Rochester Credit Center, Inc. d/b/a The Credit Bureau." Plaintiff's amended complaint alleges six causes of action (Item 5).

 Plaintiff's first four causes of action are against defendant Hospital. The first consists of both federal and state law claims and alleges violation of the Fair Credit Billing Act, 15 U.S.C. § 1666, et seq., New York General Business Law § 701, et seq., and New York General Business Law § 349 (Id., P 34). The second, third, and fourth causes of action against defendant Hospital all allege state law claims. The second alleges breach of contract (Id., P 37). The third alleges negligence (Id., P 40). The fourth alleges negligent infliction of emotional distress (Id., P 43).

 The fifth and sixth causes of action are against defendants RCC and CBA. The fifth consists of both federal and state law claims and alleges violations of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq., and Article 29-H of the New York General Business Law (Id., P 46). The sixth is a state law claim which alleges negligence (Id., P 49).

 On July 18, 1997, defendant Hospital filed a motion to dismiss in lieu of an answer (Item 6). On August 4, 1997, defendant RCC filed a motion to dismiss plaintiff's amended complaint (Item 10). On October 30, 1997, defendant CBA filed a motion to dismiss plaintiff's amended complaint (Item 19).

 DISCUSSION

 In ruling on a motion to dismiss, it is well established that the court must view the complaint in the light most favorable to the plaintiff. Newman & Schwartz v. Asplundh Tree Expert Co., 102 F.3d 660, 662 (2d Cir. 1996) (citing Scheuer v. Rhodes, 416 U.S. 232, 238, 40 L. Ed. 2d 90, 94 S. Ct. 1683 (1974)). Furthermore, the court "must accept as true all the factual allegations in the complaint." Newman, 102 F.3d at 662 (citing Leatherman v. Tarrant County Narcotics Unit, 507 U.S. 163, 164, 122 L. Ed. 2d 517, 113 S. Ct. 1160 (1993)). A motion to dismiss can be granted only if "it appears beyond doubt that the plaintiff ...


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