LabCorp Faces Shareholder Lawsuit Over Concealed Data Breaches
A LabCorp shareholder files a derivative suit accusing the company's board of hiding two major data breaches from investors and the public. The legal action claims inadequate cybersecurity measures exposed millions of patient records.
A LabCorp shareholder files a lawsuit against the laboratory giant, accusing its board of directors of concealing details about two separate data breaches that affect millions of patients. The legal action targets the company's leadership, including Chief Executive Adam Schechter, and claims the board intentionally hides these security incidents from shareholders.
The complaint centers on two major security lapses, including a 2019 breach at a third-party billing provider that impacts 7.7 million LabCorp patients and a separate incident uncovered by TechCrunch that exposes thousands of medical documents. The shareholder argues that insufficient cybersecurity procedures directly contribute to these massive exposures of sensitive health information.
The suit alleges that LabCorp violates its fiduciary duties by failing to inform patients, customers, and state attorneys general within legally required timeframes. Furthermore, the plaintiff claims the company deliberately omits the breaches from public releases and SEC filings, a accusation that a LabCorp spokesperson strongly denies and promises to vigorously defend against in court.