Centralization Sought for Hospital Data Breach Class Action Lawsuits

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Plaintiffs from the largest of many Community Health Systems hospital data breach class action lawsuits are seeking centralization of the cases, according to a recent motion sent to the U.S. Judicial Panel on Multidistrict Litigation.

The Alabama plaintiffs allege that the hospitals affiliated with the company were affected by a data breach in April 2014 by a Chinese hacker group that resulted in the release of 4.5 million patients’ information including Social Security numbers, names, addresses and other information. The plaintiffs argue their class action lawsuit is similar to other hospital data breach lawsuits that have been filed in West Virginia and Pennsylvania, among others.

However, the putative Class in the District of Northern Alabama distinguishes itself by noting that it has many more claims, including violations of the Racketeer-Influenced and Corrupt Organizations Act regarding alleged uses of “unlawful receipt of payments from the Centers for Medicare & Medicaid Services” that were than used in the purchase and renovation of Grandview Medical Center. The overwhelming majority of the claims in the other hospital data breach class action lawsuits are similar, if not nearly exactly the same as well.

The District of Northern Alabama also has some advantages, according to the motion. Not only are many of the clients already there, but the Grandview Medical Center is based close by and it is a “highly accessible and vibrant metropolitan location.” Further, because the hospital data breach class action lawsuit is also the oldest one, U.S. District Judge Karon O. Bowdre has more experience than other judges, and the district is commonly used for handling multidistrict litigation.

Finally, the plaintiffs argue the Alabama class action lawsuit includes more named defendants than the others. They include not just Community Health Systems, but also Grandview, Gadsden Regional Medical Center, Affinity hospital and other healthcare facilities associated with the group.

The hospital data breach class action lawsuit is just one of many that have begun in recent years regarding violations of the Health Insurance Portability and Accountability Act (HIPAA). One key difference between the ones regarding these Community Health Systems hospital data breach class actions and others is that the putative Class argues that there is a very real threat of their private information being published as it was collected by a hacker group, rather than a thief at a physical location or disgruntled employee.

Plaintiffs in the lead case are represented by Donald W. Stewart, Greg W. Foster and T. Dylan Reeves of Stewart & Stewart PC.

The Community Health Systems Data Breach Class Action Lawsuit is Denise B. Alverson, et al. v. Community Health Systems Inc., et al., Case No. 2:14-cv-01620, in the U.S. District Court for the Northern District of Alabama.