Pennsylvania hospital, software firm sue each other for alleged data, software theft

Enola, Pa.-based Post Acute Medical and Meridian Hospital Systems Corp., a healthcare software company, have filed lawsuits against one another for alleged theft, Pennsylvania Record reports.

In its lawsuit, filed July 2 in U.S. District Court for the Middle District of Pennsylvania, PAM claims that Meridian illegally obtained and stored its patient records and protected health information after PAM decided to terminate its business relationship with the vendor. The healthcare provider alleged that Meridian has been holding the data hostage since May 2019, according to the report.

The lawsuit alleges that per their June 2018 contract, Meridian understood that it had no authorization to use PAM's confidential data for any reason other than to support PAM's operations and that the software vendor was aware that it was required to return PAM's data once the contract ended, according to HIPAA regulations, the publication reports.

PAM chose to terminate its business relationship with Meridian and develop its own software applications after reporting various frustrations about the effectiveness of the software to Meridian's CEO Christopher LeBlanc.

Meridian, which filed a lawsuit against PAM in Harris County, Texas District Court, alleges PAM stole the vendor's software to give it to a competitor company, according to a report. Additionally, Meridian claims PAM committed trade secret violations, breach of contract and unfair competition, among other charges. The company filed a temporary restraining order against PAM and is seeking financial damages and monthly royalty payments of $59,300, Pennsylvania Record reports.

In addition to the temporary restraining order, it also seeks extensive financial damages and monthly royalty payments of $59,300.

PAM claims there is no connection to Texas that would warrant any litigation being contested there, according to its lawsuit. The healthcare provider has filed two motions to dismiss Meridian's claims, which a Texas judge denied July 10. PAM has appealed the ruling and further proceedings will take place in a court of appeals.

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