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Rivell, et al. v. Private Health Care Systems, Inc., et al.

The Eleventh Circuit Court of Appeals reversed and remanded a district court’s dismissal of a complaint by two doctors, on behalf of themselves and others similarly situated. The doctors alleged that a preferred provider organization and an affiliated distributor of medical discount cards used their names, professional identities and practice information without their consent to sell medical discount cards for commercial gain. The doctors claimed the defendants appropriated their names and identities for commercial purposes without their consent.

The defendants filed a motion to dismiss in which they argued that the doctors’ claims could only arise under the contract between the provider and the doctors and therefore the doctors’ tort claim of appropriation should be dismissed. The district court agreed with defendants and dismissed the claim.

The circuit court determined that the district court erred in dismissing the doctors’ appropriation and related claims because “Georgia law is clear that the doctors’ claim of misappropriation is not preempted by their contract with [the provider].” The court cited a Georgia state court decision, Whisper Wear, Inc. v. Morgan, 277 Ga. App. 607 (Ga. App. 2006), in which the court found that even though there was a contract governing the use of a model’s photographs by the photographer, as long as the plaintiff alleged that the defendant used her name and identity for a commercial purpose and without her authorization or consent, then she properly alleged the tort of appropriation.

The circuit court also cited several other states, including New York, California, Florida, Massachusetts, Connecticut, Ohio and Illinois, which also recognize that a use outside the scope of the permission granted in a contract not only constitutes breach of contract, but also gives rise to an action by the licensor for invasion of privacy.

The circuit court acknowledged that although the agreements that the doctors signed with the provider did not preempt a claim for appropriation, the agreements could be used by defendants as evidence of the doctors’ consent, which could be an affirmative defense to the tort of appropriation.