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P H I L A D E L P H I A , F R I D A Y, A P R I L 2 9 , 2 0 1 6
Pa. Justices Deny
Appeal in Overdraft
Fee Class Action
T H E
U N I T E D
S T A T E S
VOL 253 • NO. 83 $5.00
Ex-NFL Players Sue Lawyers
Over Fees in Concussion Suit
BY P.J. D’ANNUNZIO
Of the Legal Staff
BY BEN SEAL
Of the Legal Staff
The Supreme Court of Pennsylvania
has declined to review a lower court
decision allowing a class action alleging
improperly-assessed bank overdraft fees
to proceed.
The state Supreme Court on Wednesday
denied allocatur in Collier v. National Penn
Bank, letting stand a ruling that found an
updated bank account agreement with no
arbitration clause supersedes an earlier
agreement that mandated arbitration.
A unanimous three-judge panel of the
Superior Court on Nov. 24, 2015, affirmed
a trial court order overruling National Penn
Bank’s petition to compel arbitration, and
quashed the bank’s appeal of an order
overruling its demurrer, saying it had no
jurisdiction to review the demurrer.
Overdraft Fee continues on 9
Court Rejects Data
Breach Lawsuit
Against Health Plans
BY GINA PASSARELLA
Of the Legal Staff
The Pennsylvania Superior Court has once
again thwarted a proposed class action lawsuit against two health plans over the loss of
a flash drive with nearly 300,000 patients’
Data Breach continues on 9
With the launch of a new website and
expansion of its partnership with a local
accelerator, Cozen O’Connor is looking
to grow its recognition within the startup
community.
ONLINE ONLY
Contributor Gina Rubel provides
tips on how Americans can
embrace Russian culture in
order to be more successful when doing
business with Russians. Visit at.law.com/
Russian.
Officer’s Suit Against Paterson . . . . . . 3
The U.S. Supreme Court has reinstated
a First Amendment suit by a Paterson,
New Jersey, police detective who
was demoted based upon a mistaken
impression that he was engaging in
political activity.
AP photo by Rick Osentoski
MARIJUANA LAW
Protecting Your Client and License. . . . 5
individual cases over dissatisfaction with
the representation they received.
“Defendant law firms’ efforts on
plaintiffs’ cases have been expended exclusively in furtherance of the NFL concussion class action litigation for which
some of defendant law firms will be richly
compensated,” the complaint said. “But,
based on information and belief, defendant
law firms have made no substantive efforts
NFL continues on 9
Cozen O’Connor Launches Website,
Expands Startup Community Ties
BY LIZZY MCLELLAN
Of the Legal Staff
– INSIDE THE LEGAL –
REGIONAL
F
ormer professional football players
involved in the NFL concussion
litigation have sued their former
attorneys in federal court over liens placed
or intended to be placed on the players’
individual cuts of the league’s $1 billion
settlement.
In their complaint, the seven plaintiffs—Gale Sayers, Lem Barney, Thomas
Skladany, Thomas Vaughn, Jerry Rush,
Kenneth Callicutt and Eric Hipple—asked
the court to declare that the law firms formerly representing them in the concussion
litigation are not entitled to liens on the
players’ recovery. Sayers and Barney are
members of the Pro Football Hall of Fame.
The firms sued are Hausfeld; Zimmerman
Reed; Locks Law Firm; Bondurant Mixson
& Elmore; and Pope McGlamry.
The players allege that they terminated
their respective firms’ handling of their
1 8 4 3 - 2 0 1 6
Earlier this week, Cozen O’Connor
announced its expanded partnership with
Dreamit, a multicity business accelerator
headquartered in Philadelphia. It also announced the launch of COpilot, a website
aimed at providing business and legal
resources for emerging companies.
Startup continues on 11
Because of the Medical
Marijuana Act’s breadth and
the state’s demographics,
Pennsylvania is poised to be legalized
marijuana’s next hot spot, contributor
Steven M. Schain writes.
PARALEGALS PAGE
Key Elements of Police Report. . . . . . . 7
Paralegals play an important
role in assembling documents
and organizing facts during the
investigative aspect of a case, contributor
Christine M. Flynn writes.
INDEX
Experts & Services. . . . . . . . . . . . . . . . 12
Classified . . . . . . . . . . . . . . . . . . . . . . . . 13
Public Notices. . . . . . . . . . . . . . . . . . . . 14
Legal Listings . . . . . . . . . . . . . . . . . . . . 16
Postal ID on Page 8
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Data Breach
continued from 1
data, in part relying on a ruling that came
down between the plaintiffs’ first and
second attempts to certify the class.
When a prior Superior Court panel ruled
on the case of Baum v. Keystone Mercy
Health Plan, it remanded the case back to
the Philadelphia trial court after determining the lower court mistakenly found the
plaintiffs had to show reliance on the health
plans’ privacy promises to prove a claim
for deceptive practices under the Uniform
Trade Practices and Consumer Protection
Law. The Superior Court said only the
UTPCPL’s fraud provisions required proof
of reliance, not the deceptive practices provision. It asked the trial court to review the
plaintiff’s motion to certify the class on that
claim, the merits of which the trial court
hadn’t previously tackled.
The Philadelphia trial court ultimately
ruled against plaintiff Avrum Baum’s class
certification motion on remand, finding
he couldn’t show his daughter’s data that
was lost included personally identifiable
information. The court also found Baum
didn’t have standing to bring a private
cause of action under the UTPCPL because he did not purchase his daughter’s
insurance policy, but rather it was paid for
through Medicaid.
But before the Philadelphia trial court
issued that ruling, a panel of the Superior
Court had ruled in 2015 in the case of
Kern v. Lehigh Valley Hospital. In that
case, the court rejected the concept that it
espoused in the first Baum decision, finding
instead that justifiable reliance is required
on claims of deceptive practices under
the UTPCPL.
In its Tuesday opinion in Baum, Judge
Correale F. Stevens reiterated that the first
Baum court ruled the trial court appropriately dismissed the UTPCPL fraudulent
practices claim.
“In light of Kern, and upon review of
the trial court’s additional findings of fact
and conclusions of law on remand, we
further find the trial court did not abuse
its discretion in denying [Baum’s] motion
to certify the class to the extent it alleged
deceptive conduct under the UTPCPL’s
catchall provision,” Stevens said.
Under Kern, Stevens said, Baum had
to demonstrate that he and all the prospective class members justifiably relied
on the health plans’ alleged violations of
the UTPCPL and that they suffered an
ascertainable loss as a result. Having to
demonstrate reliance is an individual inquiry that makes class certification impractical, the court found.
Even though the trial court had
improperly found Baum met the
Data Breach continues on 11
VOL P. 2839
Data Breach
continued from 9
commonality requirement given its then
working assumption that reliance didn’t
have to be proved, Stevens noted that the
lower court properly used its discretion
in denying class certification under other
factors, such as numerosity and typicality,
adequacy of representation and the fair and
efficient method of adjudication.
According to the opinion, Baum’s special-needs daughter had health insurance
through Keystone Mercy Health Plan,
which was paid for by the state through a
Medicaid program.
In 2010, one of the health plan’s employees copied data from the plan’s computer system onto an unencrypted flash
drive that was later misplaced and never
found. The flash drive had private health
information that was protected by the
plans’ own practices, the federal Privacy
FRID A Y, A P R I L 2 9 , 2 0 1 6
of Individually Identifiable Health
Information rule and the Pennsylvania
Privacy of Consumer Health Information
law, according to the opinion.
The flash drive contained, variously,
names, addresses, zip codes, dates of birth,
Social Security numbers, member identification numbers and clinical information such as medications, lab results and
health screening information, Stevens said.
The drive contained partial Social Security
numbers for 801 people and full Social
Security numbers for seven people. The
remaining more than 283,000 people whose
information was on the drive had some form
of the other types of information listed. The
health plans offered credit monitoring to the
808 people whose Social Security numbers
were compromised, Stevens said.
In Baum’s case, his daughter’s member
identification number and health screening
information were on the flash drive.
On remand, the trial court had determined
Baum couldn’t appropriately represent those
THE LEGAL INTELLIGENCER • 11
class members who did have personally
identifiable information.
“Stressing [the plans] had pledged to protect any information it possessed that would
allow someone to identify and learn about
an insured’s health and the record herein
revealed that any information contained on
the flash drive would not identify [Baum’s]
daughter, the trial court determined [Baum]
could not claim to represent those class
members who did lose such data, and
therefore, may have been subjected to a
deception,” Stevens said.
Baum had argued on appeal that member identification numbers were identifiable
information.
Superior Court Judges Judith F. Olson
and Paula F. Ott joined Stevens in the
result only.
Attorneys at Brodsky & Smith in Bala
Cynwyd and WeissLaw in New York
represented Baum.
Attorneys from Rawle & Henderson in
Philadelphia and Epstein Becker & Green
in Washington, D.C., represented defendants Keystone Mercy Health Plan and
AmeriHealth Mercy Health Plan.
Charles A. Fitzpatrick III of Rawle &
Henderson said he was pleased with the
ruling considering there “was never a
shred of evidence” that there was an actual data breach or that any of the nearly
300,000 individuals had their identity
compromised. Fitzpatrick said he read the
court’s ruling to mean that it would have
come to the same conclusion with or without Kern given the other factors the trial
court addressed.
Gina Passarella can be contacted at
215-557-2494 or [email protected].
Follow her on Twitter @GPassarellaTLI.
(Copies of the 18-page opinion in Baum
v. Keystone Mercy Health Plan, PICS No.
16-0546, are available from The Legal
Intelligencer. Please call the Pennsylvania
Instant Case Service at 800-276-PICS to
order or for information.) •