Allscripts, Medfusion settle lawsuit

Electronic health record vendor Allscripts and patient portal vendor Medfusion have reached a settlement their legal dispute, according to an announcement released Jan. 7.

The two companies had entered into a five-year agreement in 2009 to integrate Medfusion's portal with Allscripts EHRs and to market the portal. The agreement had been amended several times, most recently to deal with a backlog of orders for the portal caused by Allscripts' delay in implementation and billing. Allscripts then acquired Jardogs, a competitor of Medfusion, before the contract expired, to Medfusion's detriment.

The Medfusion-Allscripts contract was terminated in 2014, and the former sued the latter for $5.46 million, claiming breach of contract, fraud, fraudulent inducement, unfair methods of competition and unfair and deceptive trade practices. Medfusion had been indirectly supporting about 30,000 Allscripts EHR users.

Allscripts tried to dismiss the lawsuit, in large part on the question of whether a limitation of liability damages clause was ambiguously written.

The terms of the settlement were not disclosed.

Allscripts certainly is no stranger to litigation and controversy. It sued New York City's hospitals and rival Epic in 2012 after losing a bid, claiming that they failed the follow the rules of the competitive bidding process. That lawsuit was later dropped. 

Additionally, a Florida physician group sued Allscripts after the latter discontinued its MyWay EHR product, claiming that Allscripts refused to fix defects or refund money, and that the "free" upgrade to its EHR Pro product wasn't really free. And patent holder MyMedicalRecords sued Allscripts and several other vendors for violating its patent on personal health records; a judge threw that lawsuit out in 2015 on the grounds that the patent was invalid.

To learn more:
- read the announcement