Hospital Corporation of America sued over Aventura Hospital breach

Monica Pais reports:

The operators of Aventura Hospital in Miami failed to safeguard patient records, leaving them vulnerable to identity theft and exposure of their personal health information, a class claims in court.

In a complaint filed in Miami Federal Court, named plaintiff Kellie Lynn Case says she is one of thousands of current and former patients whose personal information was entrusted to defendants Hospital Corporation of America and Envision Healthcare Corporation.

Read more on Courthouse News.

The Aventura breach involving an employee of their contractor, Valesco Ventures, was first reported on this site on September 15 after it appeared on HHS’s public breach tool. In that post, I noted how this appeared to be their third breach in recent years, and it did not appear to be their first insider breach. Several days later, I wrote a commentary about how HHS and FTC should investigate this breach:

For years – even before the mainstream media caught on to the epidemic – had been reporting cases of insider data theft for tax refund fraud schemes and calling special attention to Florida. By now, everyone seems to acknowledge that Florida is a hotbed of such crime.

Yet despite this growing recognition of an ongoing and serious problem, HHS does not appear to have taken any strong enforcement action over any covered entity for failing to protect PHI or ePHI from the insider threat.

In October, I followed up and reported a statement from HHS in response to my inquiries. Their response was that such cases were turned over to DOJ for criminal prosecution. As I pointed out, what does that say about OCR pursuing the hospital for its failures to ensure adequate technical and administrative safeguards? I received no answer to that question.

To date, there is no entry on HHS’s breach tool that would indicate that their investigation of the breach is closed, and I do hope that they are investigating this breach and that any resolution involves not only access controls but monitoring and auditing of access so that it doesn’t take two years to learn that there’s a problem.

But can Ms. Case’s lawsuit prevail? I’ve uploaded the complaint here (pdf). It alleges breach of express contract, breach of implied contract, and restitution/unjust enrichment. Using HIPAA and NIST recommended standards as well as Florida law, it basically argues that Aventura failed to adequately secure patient data that its privacy policies and statements assured would be kept confidential and private. Further, it argues that the plaintiff would not have paid Aventura so much money if she knew that Aventura was not fulfilling its contractual obligation to keep her information secure and confidential.

What it doesn’t claim is that the plaintiff has experienced any harm or injury or even “imminent” injury such as tax refund fraud. The only injury alleged is the loss of money she paid Aventura for a security service she did not get.

So I see nothing that really distinguishes this case from many other cases that get dismissed. There are no statutory penalties for violation of the Florida statute and the court will not want to open up a bag of worms whereby every entity that has a breach could be successfully sued for not living up to its privacy policy and the law’s requirement that data be kept confidential. Furthermore, this plaintiff  is not the first to try to argue that she didn’t get what she paid for because of inadequate security (see the LinkedIn data breach litigation), and I would be very surprised if that argument had any legs here, either.

So overall, I wouldn’t bet on this case going anywhere, but as I am not a lawyer, I could be totally wrong, of course.

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