Healthcare Services Group has agreed to pay $3,000,000 to settle litigation arising from a September 2024 cybersecurity incident that involved unauthorized access to systems containing the personal and protected health information of 624,496 individuals. Healthcare Services Group is a Bensalem, PA-based provider of environmental, dining, and nutritional support services, and works with more than 3,000 healthcare facilities in 48 U.
S. states. Suspicious network activity was identified on or around October 7, 2024, and the forensic investigation determined that its network was first breached by an unauthorized third party on September 27, 2024.
Prompt action was taken to prevent further unauthorized access, but files containing protected health information had already been exfiltrated from its network. Those files contained information such as names, Social Security numbers, driver’s license numbers, state identification numbers, financial account details, full access credentials, and medical and health insurance information.
Notification letters started to be mailed to the affected individuals on August 25, 2025, and on August 27, 2025, the first class action lawsuit was filed. Further lawsuits were filed that made similar claims, and the actions were consolidated into a single complaint – Williamson, et al. v.
Healthcare Services Group, Inc. – in the United States District Court for the Eastern District of Pennsylvania. The consolidated lawsuit asserted claims for negligence, breach of implied contract, breach of contracts to which the plaintiffs and class members were intended third-party beneficiaries, breach of fiduciary duty, unjust enrichment, violations of the New Jersey Consumer Fraud Act and Washington Consumer Protection Act, and declaratory and injunctive relief.
Healthcare Services Group denies any wrongdoing and disagrees with all claims and contentions in the lawsuit. All parties agreed to a settlement as they concluded that further litigation would likely be expensive and protracted, and by settling, all parties avoid the uncertainty and risks of a trial. Healthcare Services Group has agreed to establish a $3,000,000 settlement from which attorneys’ fees and expenses, settlement administration costs, and service awards for the class members will be deducted.
The remaining funds will be used to pay benefits to the class members. Class members are entitled to claim three years of single-bureau credit monitoring services, which include identity theft insurance and identity theft recovery services. A claim may be submitted for reimbursement of documented, unreimbursed losses due to the data breach up to a maximum of $5,000 per class member, and a claim may also be submitted for a one-time pro rata cash payment.
The cash payments will exhaust the settlement fund, and their value depends on the number of valid claims received. Requests for exclusion and objections must be submitted by September 4, 2026. The deadline for submitting a claim is October 1, 2026, and the final fairness hearing is scheduled for September 24, 2026.
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Originally published at hipaajournal.com
