Drug and Alcohol Treatment Services, Inc. , a Scranton, Pennsylvania-based provider of drug and alcohol addiction services, has agreed to settle class action litigation stemming from an October 2024 ransomware attack. The attack resulted in the theft of the personal and protected health information of employees and patients.
The HHS’ Office for Civil Rights was informed that 22,215 patients were affected. Data exposed or stolen in the incident included names, dates of birth, Social Security numbers, health insurance information, medical billing/claims information, patient account numbers, prescription/medication information, and diagnosis/treatment information. Eight class action lawsuits were filed in response to the data breach, which were consolidated into a single complaint – Leo Woytach, et al v.
Drug and Alcohol Treatment Services, Inc. – in the Court of Common Pleas of Lackawanna County, Pennsylvania. The consolidated lawsuit asserted claims for negligence, negligence per se , breach of contract, breach of implied contract, breach of fiduciary duty, breach of confidence, and unjust enrichment.
The defendant denies all claims and contentions in the lawsuit and maintains there was no wrongdoing. Following negotiations about a potential settlement and a full day of mediation, settlement terms were agreed upon that were acceptable to all parties. By settling, all parties avoid the costs, distraction, burden, and risks of a trial and related appeals.
The defendant will establish a $549,000 settlement fund, from which attorneys’ fees and expenses, settlement administration/notification costs, and service awards for the eight class representatives will be paid. The remainder will be used to pay benefits to the class members. The settlement covers individuals who were notified about the data breach and provides cash payments to individuals who submit a valid claim.
Claims may be submitted for reimbursement of documented, unreimbursed losses due to the data breach up to a maximum of $5,000 per class member, or a claim may be submitted for a pro rata cash payment. The value of the cash payments will be determined by the number of valid claims received. In addition, class members qualify for a free 12-month membership to a medical data monitoring service.
The deadline for filing an objection and opting out of the settlement is August 25, 2026. Claims must be submitted by September 24, 2026, and the final fairness hearing has been scheduled for November 24, 2026. June 9, 2025: Drug and Alcohol Treatment Services Facing Multiple Class Action Data Breach Lawsuits A Pennsylvania non-profit provider of drug and alcohol addiction services is facing multiple class action lawsuits over an October 2024 ransomware attack.
Drug and Alcohol Treatment Services, Inc. (DATS), based at 441 Wyoming Avenue in Scranton, PA, identified unauthorized access to its computer network on October 6, 2024. The forensic investigation confirmed that an unauthorized third party had access to the protected health information of 22,215 individuals between October 5 and October 6, 2024.
Data compromised in the incident included patient names, dates of birth, medical histories, treatment information, health insurance information, medical claims information, billing information, Social Security numbers, and financial information. The data breach was confirmed by DATS on December 5, 2024; however, notification letters were not sent to the affected individuals until May 2, 2025.
DATS said it was unaware of any misuse of the stolen data at the time of issuing notification letters and offered the affected individual complimentary credit monitoring and identity theft protection services. The notification letters did not state the exact nature of the cyberattack; however, the Interlock ransomware group claimed responsibility for the attack and said 150 GB of data was stolen.
The ransom was not paid, so the group published the stolen data on its data leak site. The group claims the leaked files include the personal data of employees and patients. Currently, at least eight class action lawsuits have been filed against DATS over the data breach.
The lawsuits make similar claims, including negligence for failing to protect its information technology systems and sensitive patient and employee data. The lawsuits claim the data breach could have been prevented if DATS had implemented reasonable security measures and adhered to industry-standard data security practices. The lawsuits also claim that DATS did not provide timely notifications to the affected individuals, who were informed that their sensitive data had been stolen seven months after the data breach.
The lawsuits claim the notification delay deprived the plaintiffs and class members of the opportunity to take action to mitigate the harmful effects of the data breach. The lawsuits also assert claims of breach of confidence, breach of implied contract, breach of fiduciary duty, unjust enrichment, and invasion of privacy. The lawsuits seek class certification, a jury trial, damages, attorneys’ fees, reimbursement of legal costs and expenses, and injunctive relief, including an order from the court compelling DATS to implement measures to improve security.
The post Drug and Alcohol Treatment Services Settles Data Breach Litigation appeared first on The HIPAA Journal .
Originally published at hipaajournal.com
