##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 Form 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2009.
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from            to
 Commission file number: 001-13326
 MEDQUIST INC.
 (Exact name of registrant as specified in its charter)
 New Jersey
    
    22-2531298(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)1000 BISHOPS GATE BOULEVARDSUITE 300MOUNT LAUREL, NEW JERSEY
    
    08054-4632(Address of principal executive offices)
    
    (Zip Code)
 (856) 206-4000  (Registrants telephone number, including area code)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




---



##### 



MEDQUIST INC.
INDEX
 PagePART I. FINANCIAL INFORMATION
    
    
    3Item 1. Financial Statements
    
    
    3Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    17Item 4. Controls and Procedures
    
    
    22PART II. OTHER INFORMATION
    
    
    23Item 1. Legal Proceedings
    
    
    23Item 1A. Risk Factors
    
    
    26Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    26Item 3. Defaults Upon Senior Securities
    
    
    26Item 4. Submission of Matters to a Vote of Security Holders
    
    
    26Item 5. Other Information
    
    
    26Item 6. Exhibits
    
    
    27Transcription Services AgreementCertification of Chief Executive OfficerCertification of Chief Financial OfficerCertification of Chief Executive OfficerCertification of Chief Financial Officer
  2




---



##### Table of Contents



Item 1. Financial Statements
 MedQuist Inc. and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share amounts)
Unaudited
 Three months endedMarch 31,2009
    
    
    2008Net revenues
    
    $
    78,944
    
    
    $
    83,725Operating costs and expenses:Cost of revenues
    
    
    53,868
    
    
    
    61,258Selling, general and administrative
    
    
    10,577
    
    
    
    13,095Research and development
    
    
    2,416
    
    
    
    4,119Depreciation
    
    
    2,552
    
    
    
    2,928Amortization of intangible assets
    
    
    1,511
    
    
    
    1,361Cost of investigation and legal proceedings, net
    
    
    785
    
    
    
    6,398Total operating costs and expenses
    
    
    71,709
    
    
    
    89,159Operating income (loss)
    
    
    7,235
    
    
    
    (5,434
    )Equity in income of affiliated company
    
    
    72
    
    
    
    16Other income
    
    
    
    
    
    
    438Interest income, net
    
    
    46
    
    
    
    1,288Income (loss) before income taxes
    
    
    7,353
    
    
    
    (3,692
    )Income tax provision
    
    
    499
    
    
    
    725Net income (loss)
    
    $
    6,854
    
    
    $
    (4,417
    )Net income (loss) per share:Basic
    
    $
    0.18
    
    
    $
    (0.12
    )Diluted
    
    $
    0.18
    
    
    $
    (0.12
    )Weighted average shares outstanding:Basic
    
    
    37,556
    
    
    
    37,544Diluted
    
    
    37,556
    
    
    
    37,544
 The accompanying notes are an integral part of these consolidated financial statements.
 3




---



##### Table of Contents



MedQuist Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands)
Unaudited
 March 31,
    
    
    December 31,2009
    
    
    2008AssetsCurrent assets:Cash and cash equivalents
    
    $
    51,854
    
    
    $
    39,918Accounts receivable, net of allowance of $4,148 and $4,802, respectively
    
    
    46,465
    
    
    
    50,374Income tax receivable
    
    
    174
    
    
    
    154Other current assets
    
    
    7,133
    
    
    
    8,053Total current assets
    
    
    105,626
    
    
    
    98,499Property and equipment, net
    
    
    13,916
    
    
    
    15,785Goodwill
    
    
    40,372
    
    
    
    40,545Other intangible assets, net
    
    
    39,053
    
    
    
    39,877Deferred income taxes
    
    
    1,178
    
    
    
    1,204Other assets
    
    
    6,385
    
    
    
    6,295Total assets
    
    $
    206,530
    
    
    $
    202,205Liabilities and Shareholders EquityCurrent liabilities:Accounts payable
    
    $
    7,129
    
    
    $
    7,487Accrued expenses
    
    
    10,238
    
    
    
    11,994Accrued compensation
    
    
    12,126
    
    
    
    11,204Customer accommodation
    
    
    11,994
    
    
    
    12,055Deferred income taxes
    
    
    651
    
    
    
    651Deferred revenue
    
    
    14,207
    
    
    
    15,630Total current liabilities
    
    
    56,345
    
    
    
    59,021Deferred income taxes
    
    
    1,104
    
    
    
    799Other non-current liabilities
    
    
    2,090
    
    
    
    2,033Commitments and contingencies (Note 9)Shareholders equity:Common stock  no par value; authorized 60,000 shares;
37,556 and 37,556 shares issued and outstanding, respectively
    
    
    237,955
    
    
    
    237,907Accumulated deficit
    
    
    (92,342
    )
    
    
    (99,198
    )Accumulated other comprehensive income
    
    
    1,378
    
    
    
    1,643Total shareholders equity
    
    
    146,991
    
    
    
    140,352Total liabilities and shareholders equity
    
    $
    206,530
    
    
    $
    202,205
 The accompanying notes are an integral part of these consolidated financial statements.
 4




---



##### Table of Contents



MedQuist Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(In thousands)
Unaudited
 Three months endedMarch 31,2009
    
    
    2008Operating activities:Net income (loss)
    
    $
    6,854
    
    
    $
    (4,417
    )Adjustments to reconcile net income (loss) to cash provided by
(used in) operating activities:Depreciation and amortization
    
    
    4,063
    
    
    
    4,289Equity in income of affiliated company
    
    
    (72
    )
    
    
    (16
    )Deferred income tax provision
    
    
    309
    
    
    
    719Stock option expense
    
    
    48
    
    
    
    92Provision for (recovery of) doubtful accounts
    
    
    (105
    )
    
    
    263Loss on disposal of property and equipment
    
    
    24
    
    
    
    26Changes in operating assets and liabilities:Accounts receivable
    
    
    3,920
    
    
    
    (3,700
    )Income tax receivable
    
    
    (20
    )
    
    
    78Other current assets
    
    
    923
    
    
    
    (189
    )Other non-current assets
    
    
    (18
    )
    
    
    70Accounts payable
    
    
    392
    
    
    
    (2,773
    )Accrued expenses
    
    
    (1,739
    )
    
    
    (746
    )Accrued compensation
    
    
    930
    
    
    
    (999
    )Customer accommodation
    
    
    
    
    
    
    (459
    )Deferred revenue
    
    
    (1,424
    )
    
    
    1,441Other non-current liabilities
    
    
    63
    
    
    
    (70
    )Net cash provided by (used in) operating activities
    
    $
    14,148
    
    
    $
    (6,391
    )Investing activities:Purchase of property and equipment
    
    
    (1,393
    )
    
    
    (1,837
    )Capitalized software
    
    
    (766
    )
    
    
    (611
    )Net cash used in investing activities
    
    
    (2,159
    )
    
    
    (2,448
    )Financing activities:Net cash provided by financing activities
    
    
    
    
    
    
    Effect of exchange rate changes
    
    
    (53
    )
    
    
    (32
    )Net increase (decrease) in cash and cash equivalents
    
    
    11,936
    
    
    
    (8,871
    )Cash and cash equivalents  beginning of period
    
    
    39,918
    
    
    
    161,582Cash and cash equivalents  end of period
    
    $
    51,854
    
    
    $
    152,711Supplemental cash flow information:Cash paid (recovered) for income taxes
    
    $
    (131
    )
    
    $
    95Accommodation payments paid with credits
    
    $
    61
    
    
    $
    404
 The accompanying notes are an integral part of these consolidated financial statements.
 5




---



##### Table of Contents



1. Basis of Presentation
    2. Stock-Based Compensation
 Share Based Payment
 Three months ended March 31,2009
    
    
    2008Selling, general and administrative
    
    $
    48
    
    
    $
    56Research and development
    
    
    
    
    
    
    24Cost of revenues
    
    
    
    
    
    
    12Total
    
    $
    48
    
    
    $
    92
   WeightedWeighted
    
    
    AverageShares
    
    
    Average
    
    
    Remaining
    
    
    AggregateSubject to
    
    
    Exercise
    
    
    Contractual
    
    
    IntrinsicOptions
    
    
    Price
    
    
    Life in Years
    
    
    ValueOutstanding, December 31, 2008
    
    
    1,816
    
    
    $
    23.34Granted
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    Canceled
    
    
    (234
    )
    
    
    19.48Outstanding, March 31, 2009
    
    
    1,582
    
    
    
    24.54
    
    
    
    3.7
    
    
    $
    Exercisable, March 31, 2009
    
    
    1,286
    
    
    
    28.29
    
    
    
    2.4
    
    
    $
    Options vested and expected to vest as of March 31, 2009
    
    
    1,582
    
    
    $
    24.54
    
    
    
    3.7
    
    
    $
    
 6




---



##### Table of Contents



Expected term (years)
    
    
    5.92Expected volatility
    
    
    54.46
    %Dividend yield
    
    
    0
    %Expected risk free interest rate
    
    
    3.25
    %
  Options outstanding
    
    
    Options exercisableWeightedAverage
    
    
    Weighted
    
    
    
    
    
    
    WeightedRemaining
    
    
    Average
    
    
    
    
    
    
    AverageNumber
    
    
    Contractual Life
    
    
    Exercise
    
    
    Number
    
    
    ExerciseRange of Exercise Prices
    
    of Shares
    
    
    (in years)
    
    
    Price
    
    
    of Shares
    
    
    Price$2.71    $10.00
    
    
    314
    
    
    
    9.0
    
    
    $
    8.10
    
    
    
    18
    
    
    $
    5.71$10.01  $20.00
    
    
    397
    
    
    
    3.6
    
    
    $
    15.89
    
    
    
    397
    
    
    $
    15.89$20.01  $30.00
    
    
    580
    
    
    
    2.2
    
    
    $
    26.47
    
    
    
    580
    
    
    $
    26.47$30.01  $40.00
    
    
    96
    
    
    
    1.0
    
    
    $
    33.31
    
    
    
    96
    
    
    $
    33.31$40.01  $70.00
    
    
    195
    
    
    
    1.2
    
    
    $
    58.69
    
    
    
    195
    
    
    $
    58.691,582
    
    
    
    3.7
    
    
    $
    24.54
    
    
    
    1,286
    
    
    $
    28.29
  3. Other Comprehensive Income (Loss)
  Three months ended March 31,2009
    
    
    2008Net income (loss)
    
    $
    6,854
    
    
    $
    (4,417
    )Foreign currency translation adjustment
    
    
    (265
    )
    
    
    (104
    )Comprehensive income (loss)
    
    $
    6,589
    
    
    $
    (4,521
    )
 4. Net Income (Loss) per Share
  7




---



##### Table of Contents



Three months ended March 31,2009
    
    
    2008Net income (loss)
    
    $
    6,854
    
    
    $
    (4,417
    )Weighted average shares outstanding:Basic
    
    
    37,556
    
    
    
    37,544Effect of dilutive shares
    
    
    
    
    
    
    Diluted
    
    
    37,556
    
    
    
    37,544Net income (loss) per share:Basic
    
    $
    0.18
    
    
    $
    (0.12
    )Diluted
    
    $
    0.18
    
    
    $
    (0.12
    )
  5. Customer Accommodation
    Three months ended
    
    
    Year endedMarch 31, 2009
    
    
    December 31, 2008Beginning balance
    
    $
    12,055
    
    
    $
    18,459Payments and other adjustments
    
    
    
    
    
    
    (5,664
    )Credits
    
    
    (61
    )
    
    
    (740
    )Ending balance
    
    $
    11,994
    
    
    $
    12,055
 6. Cost of Investigation and Legal Proceedings, Net
  Three months ended March 31,2009
    
    
    2008Legal fees
    
    $
    755
    
    
    $
    4,661Other professional fees
    
    
    30
    
    
    
    237Other
    
    
    
    
    
    
    1,500Total
    
    $
    785
    
    
    $
    6,398
  8




---



##### Table of Contents



7. Restructuring Plans
 2008 Restructuring Plans
  Three Months Ended
    
    
    Year EndedMarch 31, 2009
    
    
    December 31, 2008Beginning balance
    
    $
    1,323
    
    
    $
    Charge
    
    
    
    
    
    
    2,135Cash paid
    
    
    (873
    )
    
    
    (812
    )Ending balance
    
    $
    450
    
    
    $
    1,323
 8. Income Taxes
  Accounting for Uncertainty in Income Taxes  an
interpretation of FASB Statement 109
 9. Commitments and Contingencies
 SEC Investigations
 Of the Company
  Of Former Officers
  Customer Litigation
 Kaiser Litigation
  9




---



##### Table of Contents



Medical Transcriptionist Litigation
 Hoffmann Putative Class Action
  Force Putative Class Action
  Myers Putative Class Action
    10




---



##### Table of Contents



Shareholder Litigation
 Kahn Putative Class Action
     Reseller Arbitration Demand
  11




---



##### Table of Contents



Anthurium Patent Litigation
 Anthurium Solutions,
Inc. v. MedQuist Inc., et al.,
 Other Matters
     10. Related Party Transactions
  12




---



##### Table of Contents



Licensing Agreement
    13




---



##### Table of Contents



.
 OEM Supply Agreement
    Equipment Purchases
  Insurance Coverage
  Other
   14




---



##### Table of Contents



ThreemonthsendedMarch 31,2008Licensing agreement
    
    $
    805OEM supply agreement
    
    
    875Equipment purchases
    
    
    301Insurance coverage
    
    
    167Other
    
    
    (39
    )Total
    
    $
    2,109
    11. Investment in A-Life Medical, Inc. (A-Life)
   12. Financial Instruments
  15




---



##### Table of Contents



Quoted Prices InActive Markets for
    
    
    Significant Other
    
    
    SignificantMarch 31,
    
    
    Identical
    
    
    Observable
    
    
    Unobservable2009
    
    
    Assets (Level 1)
    
    
    Inputs (Level 2)
    
    
    Inputs (Level 3)AssetsExecutive
Deferred
Compensation
Plan assets
    
    $
    739
    
    
    $
    
    
    
    $
    739
    
    
    $
    
 Quoted Prices InActive Markets for
    
    
    Significant Other
    
    
    SignificantDecember 31
    
    
    Identical
    
    
    Observable
    
    
    Unobservable2008
    
    
    Assets (Level 1)
    
    
    Inputs (Level 2)
    
    
    Inputs (Level 3)AssetsExecutive
Deferred
Compensation
Plan assets
    
    $
    787
    
    
    $
    
    
    
    $
    787
    
    
    $
    
 16




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  
    
    each of the factors discussed in Item 1A, Risk Factors, of this report as well as risks discussed elsewhere in this report;
    
    each of the matters discussed in Part II, Item 1, Legal Proceedings;
    
    our ability to recruit and retain qualified MTs and other employees;
    
    changes in law, including, without limitation, the impact HIPAA will have on our business;
    
    the impact of our new services and products on the demand for our existing services and products;
    
    our increased dependence on speech recognition technology, which we license, but do not own;
    
    our current dependence on medical transcription for substantially all of our business;
    
    our ability to expand our customer base;
    
    infringement on the proprietary rights of others;
    
    our ability to diversify into other businesses;
    
    our increased dependence on offshore medical transcription subcontractors;
    
    our ability to effectively integrate newly-acquired operations, if any;
    
    competitive pricing and service feature pressures in the medical transcription industry and our response to those
pressures;
    
    difficulties relating to our significant management turnover; and
    
    general conditions in the economy and capital markets.
    17




---



##### Table of Contents



Executive Overview
       
    
    A shortage of qualified domestic MTs has increased the demand for
outsourced medical transcription services by U.S.-based healthcare
providers. This demand for qualified MTs, as well as budgetary
pressures experienced by healthcare providers, has also caused many
more U.S.-based healthcare providers to evaluate and consider the use
of offshore medical transcription labor;
    
    Several low cost providers have emerged and aggressively moved into
our market offering medical transcription services (performed both
domestically and offshore) at prices significantly below our
traditional price point. One of these low cost providers is owned by
CBaySystems Holdings. While we believe the market for outsourced
medical transcription continues to expand, the growing acceptance by
customers of the use of offshore labor has further increased the
competitive environment in the medical transcription industry;
    
    Technological advances by us and our competitors which have reduced
the length of time required to transcribe medical reports, in turn
reducing the overall cost of medical transcription services; and
    
    Increasing requirements for electronic medical records, driving up
demand for transcription services in some cases where records used to
be paper based, and driving down demand in other cases as customers
attempt to implement electronic medical records.
   
    
    reduction in overhead and other administrative costs, driven by current and projected U.S. economic conditions;
 18




---



##### Table of Contents




    
    improvement in the quality and speed of delivery of transcribed medical reports;
    
    access to leading technologies, such as speech recognition technology, without any development and investment risk;
    
    expertise in implementing and managing a medical transcription system tailored to the providers specific
requirements;
    
    access to skilled MTs; and
    
    support for compliance with governmental and industry mandated privacy and security requirements and electronic
health record (EHR) initiatives.
   
    
    revenues;
    
    operating income;
    
    net income per share;
    
    net cash provided by operating activities; and
    
    days sales outstanding.
  Critical Accounting Policies, Judgments and Estimates
   Basis of Presentation
 Sources of Revenues
  19




---



##### Table of Contents



Cost of Revenues
  Selling, General and Administrative (SG&A)
  Research and Development (R&D)
  Depreciation and amortization
  Cost of investigation and legal proceedings, net
  Consolidated Results of Operations
  Comparison of Three Months Ended March 31, 2009 and 2008
 Three Months Ended March 31,2009
    
    
    2008% of Net
    
    
    
    
    
    
    % of Net($ in thousands)
    
    Amount
    
    
    Revenues
    
    
    Amount
    
    
    Revenues
    
    
    $ Change
    
    
    % ChangeNet revenues
    
    $
    78,944
    
    
    
    100.0
    %
    
    $
    83,725
    
    
    
    100.0
    %
    
    $
    (4,781
    )
    
    
    (5.7
    %)Operating costs and expenses:Cost of revenues
    
    
    53,868
    
    
    
    68.2
    %
    
    
    61,258
    
    
    
    73.2
    %
    
    
    (7,390
    )
    
    
    (12.1
    %)Selling, general and administrative
    
    
    10,577
    
    
    
    13.4
    %
    
    
    13,095
    
    
    
    15.6
    %
    
    
    (2,518
    )
    
    
    (19.2
    %)Research and development
    
    
    2,416
    
    
    
    3.1
    %
    
    
    4,119
    
    
    
    4.9
    %
    
    
    (1,703
    )
    
    
    (41.3
    %)Depreciation
    
    
    2,552
    
    
    
    3.2
    %
    
    
    2,928
    
    
    
    3.5
    %
    
    
    (376
    )
    
    
    (12.8
    %)Amortization of intangible assets
    
    
    1,511
    
    
    
    1.9
    %
    
    
    1,361
    
    
    
    1.6
    %
    
    
    150
    
    
    
    11.0
    %Cost of investigation and legal
proceedings, net
    
    
    785
    
    
    
    1.0
    %
    
    
    6,398
    
    
    
    7.6
    %
    
    
    (5,613
    )
    
    
    (87.7
    %)Total operating costs and expenses
    
    
    71,709
    
    
    
    90.8
    %
    
    
    89,159
    
    
    
    106.5
    %
    
    
    (17,450
    )
    
    
    (19.6
    %)Operating income (loss)
    
    
    7,235
    
    
    
    9.2
    %
    
    
    (5,434
    )
    
    
    (6.5
    %)
    
    
    12,669
    
    
    
    (233.1
    %)Equity in income of affiliated company
    
    
    72
    
    
    
    0.1
    %
    
    
    16
    
    
    
    0.0
    %
    
    
    56
    
    
    
    350.0
    %Other income
    
    
    
    
    
    
    
    
    
    
    438
    
    
    
    0.5
    %
    
    
    (438
    )
    
    
    (100.0
    %)Interest income, net
    
    
    46
    
    
    
    0.1
    %
    
    
    1,288
    
    
    
    1.5
    %
    
    
    (1,242
    )
    
    
    (96.4
    %)Income (loss) before income taxes
    
    
    7,353
    
    
    
    9.3
    %
    
    
    (3,692
    )
    
    
    (4.4
    %)
    
    
    11,045
    
    
    
    (299.2
    %)Income tax provision (benefit)
    
    
    499
    
    
    
    0.6
    %
    
    
    725
    
    
    
    0.9
    %
    
    
    (226
    )
    
    
    (31.2
    %)Net income (loss)
    
    $
    6,854
    
    
    
    8.7
    %
    
    $
    (4,417
    )
    
    
    (5.3
    %)
    
    $
    11,271
    
    
    
    (255.2
    %)
 20




---



##### Table of Contents



Net revenues
  Cost of revenues
  
    
    reduced medical transcription payroll costs of $3.0 million related
directly to our increased use of speech recognition technology, which
reduces the payroll costs associated with the production of revenues;
    
    reduced technology product costs of $0.9 million;
    
    reduced medical transcription payroll cost of $1.9 million related to
the decrease in our lower medical transcription volumes; and
    
    reduced costs of $1.6 million resulting from headcount reductions
taken in 2008 to better align our overhead costs with our lower
revenues levels.
  Selling, general and administrative
  Research & development
  Depreciation
  Amortization
  21




---



##### Table of Contents



Cost of investigation and legal proceedings, net
  Interest income, net
  Income tax provision
  Liquidity and Capital Resources
   Off-Balance Sheet Arrangements
  
 Item 4. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  22




---



##### Table of Contents



Changes in Internal Control Over Financial Reporting
  
 PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
 SEC Investigations
 Of the Company
  Of Former Officers
  Customer Litigation
 Kaiser Litigation
   23




---



##### Table of Contents



Medical Transcriptionist Litigation
 Hoffmann Putative Class Action
  Force Putative Class Action
  Myers Putative Class Action
    Shareholder Litigation
 Kahn Putative Class Action
  24




---



##### Table of Contents



Reseller Arbitration Demand
    25




---



##### Table of Contents



Anthurium Patent Litigation
 Anthurium Solutions,
Inc. v. MedQuist Inc., et al.,
 Other Matters
     
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  26




---



##### Table of Contents



Item 6. Exhibits
 Exhibits
 No.
    
    Description10.1(1)
    
    Amended and Restated Stock Option Agreement by and
between Peter Masanotti and MedQuist Inc., dated March
2, 200910.1(2)
    
    Transcription Services Subcontracting Agreement by and
between MedQuist Inc. and CBay Systems & Services, Inc.
dated March 31, 200931.1
    
    Certification of Chief Executive Officer required by
Rule 13a-14(a) or Rule 15d-14(a) of the Securities
Exchange Act of 1934, as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Certification of Chief Financial Officer required by
Rule 13a-14(a) or Rule 15d-14(a) of the Securities
Exchange Act of 1934, as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Certification of Chief Executive Officer pursuant to 18
U.S.C. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 200232.2
    
    Certification of Chief Financial Officer pursuant to 18
U.S.C. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
 
 (1)
    
    Incorporated by reference to our Current Report on Form 8-K filed with the SEC on March 6, 2009(2)
    
    Incorporated by reference to our Current Report on Form 8-K filed with the SEC on April 6, 2009 27




---



##### Table of Contents



SIGNATURES
  MEDQUIST INC.Date: May 7, 2009
    /s/ Peter MasanottiPeter MasanottiPresident and Chief Executive Officer
(Principal Executive Officer)Date: May 7, 2009
    /s/ James BrennanJames Brennan
Controller and Vice-President(Principal Accounting Officer) 
 Exhibit Index
 No.
    
    Description31.1
    
    Certification of Chief Executive Officer required by Rule 13a-14(a)
or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Certification of Chief Financial Officer required by Rule 13a-14(a)
or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
 (*)
    
    Portions of this Exhibit were omitted and filed separately with the
Secretary of the SEC pursuant to a request for confidential treatment
that has been filed with the SEC. 28