Supreme Court turns to Solicitor General in Epic damages case



The U.S. Supreme Court this past month invited the top attorney for the United States federal government to weigh in about a case involving the Epic electronic health record vendor and Tata Consultancy Services.

After the case was distributed for conference in early October, the nation’s highest court invited Solicitor General Elizabeth Prelogar to file a brief expressing the views of the United States.  

Attorneys for Mumbai-based Tata did not respond to requests for comment; Epic representatives declined to comment.

WHY IT MATTERS  

As noted this past week in Trade Secrets Trends, Epic filed a petition asking the U.S. Supreme Court to review its case in April 2021.   

At issue in the case is the amount of Epic’s compensatory damages, initially awarded in 2016 by a U.S. district court jury. The lower court granted the EHR vendor $940 million in a trade secrets lawsuit, which it brought against Tata after it said employees downloaded technical documents while consulting at a Portland-area Kaiser Permanente hospital.  

In turn, Epic alleged, Tata used the knowledge to help build its own software, called Med Mantra.  

In 2017, a Wisconsin court reduced the amount of the fine levied against Tata to $480 million, to comply with a state law that caps punitive damages at twice that of compensatory damages.  

After that, a Seventh Circuit court said in 2020 that the damages should be further reduced, saying they were “constitutionally excessive.”  

In its petition for the Supreme Court to consider the case, Epic said the appeals court had committed an “unprecedented substitution of its judgment for the judgment of the jury and the Wisconsin legislature,” conflicting with Supreme Court precedent and a “long tradition” of statutes.   

Meanwhile, Tata attorneys said in a reply to the petition that it should be denied, in part because it says the Seventh Circuit’s decision “did not announce any broadly applicable legal rule – much less one that conflicts with decisions of other courts.”  

“The Seventh Circuit’s ruling is inconsistent with that of every court that has evaluated a total dollar cap on compensatory and punitive damages,” Epic countered.

The Supreme Court did not give the government a response deadline, leaving open the question of when it will decide to take the case. 

THE LARGER TREND  

Intellectual property and related lawsuits have dogged the healthcare IT industry for years, with the stiff competition between software vendors raising the stakes.   

Earlier this year, the ​​post-acute care company CareCentrix filed a corporate espionage lawsuit against Signify Health, saying that a former employee had shared confidential information.  

And in fall 2020, two telehealth giants went head to head over accusations of patent infringement, with Teladoc pointing the finger at some of Amwell’s products.  

ON THE RECORD  

“Liability is no longer disputed, as TCS has now conceded liability,” argued Epic in its petition to the Supreme Court. “The Seventh Circuit has determined that the award of compensatory damages was correct as a matter of Wisconsin law.  

“The Seventh Circuit also has resolved issues relating to Epic’s entitlement to punitive damages,” it added. “That Court has rejected TCS’s claim that certain issues relating to punitive damages must be retried. At this stage, there are no issues that would interfere with this Court’s consideration of the single issue raised in this petition.”

Kat Jercich is senior editor of Healthcare IT News.
Twitter: @kjercich
Email: kjercich@himss.org
Healthcare IT News is a HIMSS Media publication.





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