Popular software maker settles Y2K lawsuit
Software owners to receive free patch
Practices that bought versions 7 and 8 of The Medical Manager practice management software will receive a free upgrade to make the product compatible with year 2000 (Y2K) issues, under the terms of a settlement reached in a class action suit filed against the product’s manufacturer.
The settlement was reached in December in a class-action lawsuit filed on behalf of Robert Courtney, DO, a New Jersey physician, and other purchasers of versions 7 and 8 of The Medical Manager. At the same time, the company settled five of seven similar cases filed in various judicial jurisdictions across the country.
Under the settlement, the company agreed to provide a software patch that will make its old software work after Jan. 1, 2000, and Medical Manager Corp. will be released from further Y2K claims about its products.
"Our settlement represents a landmark solution to the Y2K issue, and we consider it to be a win-win scenario for both our company and our clients. The settlement takes care of our customers, and at the same time protects our company from the unpredictable potential liability that could result from Y2K litigation," says John Kang, president of the Tampa, FL-based company.
The firm’s Y2K-compliant product, Version 9, was released in 1997. It costs between $5,000 and $10,000 and must be run on a Pentium II processor, which means most physician practices would have to purchase new hardware along with the new software, says Harris Pogust, JD, of the Pennsauken, NJ, law firm of Sherman, Silverstein, Kohl, Rose and Podolsky, who represented the plaintiffs in the class action suit.
"With the patch, they can continue to use their old computers until they decide to upgrade, not when somebody else tells them it’s time," Pogust says.
Courtney, who bought the product in late 1996 for about $20,000, got a form letter in 1998 saying the software wouldn’t function in the year 2000.
About 2,000 to 4,000 practices who bought a Version 9 upgrade in response to the form letter will receive either a cash settlement or an additional Medical Manager module that will enhance their system, Pogust says.
The software product is used at approximately 25,000 physician offices throughout the country. About 75% of customers, or 10,000 physician practices, own the older versions of the software, according to Pogust.
The Medical Manager physician practice management system, the most widely installed physicians practice management system in the United States, provides financial, administrative, clinical, and practice management support for physician practices.
"Our goal is to take care of our customers in such as way as to ensure that they are happy with the product and the company they do business with. As our product is the most widely installed practice management software on the market today, a satisfied customer base is vital to our company’s future," Kang says.
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