District Court Preliminarily Approves $4.75 Million Data Breach Settlement with CaptureRx

Mar. 3, 2022 – A Texas federal judge has granted preliminary approval of a $4.75 million settlement between pharmacy benefits manager CaptureRx and consumers seeking damages after the company’s data breach exposed the personal information of more than 2.6 million people.

 Judge Orlando L. Garcia of the U.S. District Court for the Western District of Texas gave preliminary approval to a deal reached between CaptureRX and consumers in six different proposed class actions filed in Texas and California. Under the settlement terms, California residents whose information was stored with CaptureRX can submit claims to receive up to $100 from the $4.75 million pool, while consumers in other parts of the country who make valid claims will receive $25 cash payouts.

The settlement would resolve litigation stemming from a February 2021 cyberattack on CaptureRX, which exposed patients’ prescription information, first and last names, and dates of birth, according to court papers. The consumers alleged that CaptureRX had negligently failed to enact appropriate safeguards to prevent the cyberattack, while the California residents accused the company of breaching state privacy and consumer protection laws.

Class counsel is seeking attorney fees of up to $1.58 million, or a third of the cash payout pool, according to court papers filed in February. CaptureRX will also be required to “develop, implement and maintain a comprehensive information security program that is reasonably designed to protect the security, integrity and confidentiality” of patients’ personal data, according to terms of the agreement.

“These benefits represent a highly favorable compromise that balances the merits of plaintiffs’ claims and the likelihood of succeeding at trial and on appeal with the attendant risks,” class counsel wrote in their February filing.

“By settling now, the settlement class can take advantage of remedies that would be unavailable or worth substantially less by the time of a litigated final judgment,” they added.

CaptureRx’s insurer will pay a portion of the company’s litigation costs, with the company’s owners paying the remainder, according to court papers. CaptureRX’s attorneys had previously told the court that the company faced “potential insolvency” if it continued to litigate the case. 

Representatives for the consumers and for CaptureRX did not immediately respond Friday to requests for comment.

The consumers are represented by Mason Lietz & Klinger LLP, the Arnold Law Firm, and the  Kendall Law Group PLLC. 

The case is In re: CaptureRx Customer Data Security Breach Litigation, Number 5:21-cv-00523-OLG, in the U.S. District Court for the Western District of Texas.