FTC Commissioners’ Findings Are Latest Twist in LabMD Saga

Digital Health Legal October 2016

Patricia M. Wagner, Chief Privacy Officer and Member of the Firm in the Health Care and Life Sciences and Litigation practices, in the firm’s Washington, DC, office, authored an article in Digital Health Legal, titled “FTC Commissioners’ Findings Are Latest Twist in LabMD Saga.” (Read the full version – subscription required.)

Following is an excerpt:

On 29 July 2016 the Commission issued an order and opinion in the LabMD case, reversing the initial opinion of the ALJ, which had dismissed the FTC’s 2013 complaint against LabMD. The 2013 complaint alleged that LabMD ‘failed to provide “reasonable and appropriate” security for personal information maintained on LabMD’s computer networks […].’ According to the allegations, that failure was a violation of Section 5 of the FTC Act, as it was conduct that caused or was likely to cause substantial consumer injury. After the administrative hearing, the ALJ dismissed the case, finding that the FTC had failed to meet its burden of proof. The Commission Opinion reversed the ALJ’s Initial Decision, holding that LabMD’s data security practices constituted an unfair act or practice within the meaning of Section 5 of the FTC Act.