Class action is filed against Keane in Y2K-compliant case
Mineral Area Osteopathic Hospital (Farmington, MO) and two other medical facilities filed a class-action complaint against Keane Inc. (Los Angeles) on March 31, according to Mealey’s Year 2000 Report. The lawsuit asserts that the MEDNET healthcare information system sold by Keane and a predecessor is not Year 2000-compliant. The complaint was filed in the U.S. District Court for the Northern District of Iowa.
The publication reported that the hospitals complain that they spent $300,000 and more on systems sold by Iowa-based Source Data Systems between 1990 and 1993, and paid an annual support fee for an automatically renewable support agreement. The plaintiffs say that Keane acquired SDS in 1995, and that in 1997, Keane told customers the MEDNET system would be "sunsetted,'" plaintiffs complain. Keane sent a form letter to customers on Dec. 30, 1998, informing them it was canceling the support agreements pursuant to a 90-day cancellation clause. The hospitals say requested extensions are being offered only if customers waive any Year 2000 claims.
Causes of action include breach of warranty, breach of contract, breach of implied covenant of good faith and a request for an injunction forcing Keane to bring the hospitals’ MEDNET systems into compliance.
The lawsuit was filed by the firms of Milberg, Weiss, Bershad, Hynes & Lerach (New York); Belin Lamson McCormick Zumbach Flynn (Des Moines, IA); and Azrael, Gann & Franz (Towson, MD).
Keane is defending a similar lawsuit by a single hospital in Kentucky state court (Pineville Community Hospital v. Keane). SDS and Pineville are themselves defendants in a related declaratory judgment action filed by Cincinnati Insurance Co.
You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
- Award-winning Medical Content
- Latest Advances & Development in Medicine
- Unbiased Content