21st Century Oncology deal tied to $123 million breach claim approved

By Caroline Salls

Pittsburgh, Dec. 11 – 21st Century Oncology Holdings, Inc. obtained court approval of a settlement under which class action plaintiffs who hold a potential $123 million in data breach claims will be paid solely through insurance proceeds if their lawsuit against the company is successful, according to an order filed Monday with the U.S. Bankruptcy Court for the Southern District of New York.

“Instead of a potential $123 million class claim swamping the recoveries of general unsecured creditors, the data breach claimants will not obtain any recovery from the estate at all,” the motion said.

“Rather, the data breach claimants will pursue their prepetition litigation and if successful will recover solely from certain insurance proceeds.”

According to the settlement motion, the class action lawsuit filed on Jan. 17 alleges that 21st Century was the subject of a cyber attack in October 2015 because it allegedly failed to properly secure its network, allowing an unauthorized third party to access the plaintiffs’ private information.

After filing for bankruptcy, 21st Century asked the court to disallow the data breach claims. The plaintiffs subsequently sought relief from the automatic stay imposed by the bankruptcy filing and sought temporary allowance of their claims.

21st Century Oncology, a Fort Myers, Fla.-based provider of integrated cancer care services, filed for bankruptcy on May 25. The Chapter 11 case number is 17-22770.

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