Digital well being startup Dorsata has filed a lawsuit towards EHR supplier athenahealth and ladies’s well being firm Unified Ladies’s Healthcare. The startup alleged that athenahealth stole commerce secrets and techniques, used misleading enterprise practices and breached its contract — and that Unified aided and abetted these purported practices.
Dorsata filed its lawsuit within the civil courtroom of Suffolk County, Massachusetts on Wednesday. Dorsata alleged 9 counts towards athenahealth: unfair and misleading acts and practices, breach of oral contract, breach of fiduciary responsibility, frequent legislation fraud, unjust enrichment, theft of commerce secrets and techniques, tortious interference with present prospects, breach of nondisclosure settlement and business disparagement. The startup additionally introduced two counts towards Unified — aiding and abetting a breach of fiduciary responsibility, in addition to breach of contract.
The defendants moved to impound the grievance on Friday morning, Dorsata CEO David Fairbrothers instructed MedCity Information. By attempting to impound the grievance, athenahealth and Unified are in search of to remove public entry to the lawsuit and forestall Dorsata from talking about it to the press. Nevertheless, on the time of this text’s publication, the grievance was nonetheless out there for public viewing on Massachusetts’ state courtroom web site.
Specializing in knowledge instruments that assist obstetricians, Dorsata affords a platform that goals to cut back disparities in medical care throughout being pregnant and forestall avoidable issues. About 700 OB-GYN suppliers throughout the nation use the startup’s platform, Fairbrothers stated. Dorsata partnered with athenahealth in 2016 and has been offering its software to obstetricians who use the corporate’s EHR since then, he added.
The grievance alleged that in 2021, athenahealth approached Dorsata and “proposed that they work collectively to pursue a broader relationship with Unified, the most important obstetrics and gynecological docs group in the USA.” To do that, athenahealth instructed that it work along with Dorsata to offer Unified with an built-in resolution, the lawsuit stated.
Subsequent, Dorsata signed a non-disclosure settlement and supplied commerce secrets and techniques and different confidential data to athenahealth — together with monetary projections, buyer pricing, materials contracts and software program structure — based on the grievance. The startup’s choice to offer this data was “closely influenced” by the chance that it might be acquired by athenahealth, the lawsuit stated.
Working beneath the understanding that the 2 events would current the software program product to Unified as a three way partnership, Dorsata developed a software known as vU. Nevertheless, athenahealth was concurrently creating its personal model of vU that it deliberate to pitch to Unified with out Dorsata’s data, the lawsuit charged.
Dorsata poured “important time and sources” into the event of vU, and consequently, the corporate wanted “a major money infusion to proceed to develop its enterprise,” based on the lawsuit. The startup determined to borrow $6 million from athenahealth due to its perception that athenahealth “would both buy Dorsata or proceed its three way partnership to broaden their relationship with Unified.” Athenahealth “cultivated this notion,” the grievance stated. When it gave Dorsata these funds, athenahealth additionally signed a promissory observe prohibiting Dorsata from doing enterprise with any of its opponents, the startup alleged.
By assuring Dorsata that it was occupied with growing a joint resolution for Unified, athenahealth “was in a position to purchase important data of the interior workings of Dorsata’s expertise,” the lawsuit alleged. It wasn’t till after this insider data was shared that Dorsata realized athenahealth by no means had any intention of pitching the joint product to Unified, the grievance stated.
When athenahealth reduce Dorsata out of its take care of Unified, the startup was left with a “restricted capacity” to generate the income wanted to pay the EHR vendor again its $6 million by 2025, the grievance stated. It additionally stated that athenahealth is telling Dorsata’s prospects that the startup “is financially impaired and won’t stay in enterprise sooner or later.”
Dorsata is in search of damages within the quantity of lack of anticipated income, lack of firm valuation, damage to popularity, future misplaced enterprise and unlawfully gained business market benefit. The startup has additionally requested the courtroom to stop athenahealth from gathering the $6 million it loaned to Dorsata by deeming the EHR vendor’s promissory observe “a fraudulent artifice meant to stop Dorsata from competing within the market.”
An Athenahealth spokesperson instructed MedCity Information the corporate believes “the go well with is with out benefit” and plans to defend itself “vigorously.”
MedCity Information’ interview with Dorasata’s Fairbrothers occurred shortly after athenahealth moved to impound the grievance, so he was barred from commenting particularly in regards to the lawsuit. Nevertheless, he did focus on the broader situation at hand, declaring that it’s not unusual for EHR firms to deceive their digital well being companions.
“I’ve had greater than a few digital well being founders attain out to me previously day with their tales of their EHR companions finally competing with them head-to-head after years of improvement and work with their mutual prospects,” Fairbrothers stated. “To me that is anti-competitive and monopolistic in a crucial business to our nation.”
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