Law360 (July 29, 2024, 8:39 PM EDT) — A Maryland federal judge on Monday enjoined electronic medical records company PointClickCare from blocking nursing home analytics company Real Time Medical Systems from accessing patient data with automated bots, saying PCC’s firewall wasn’t justified by concerns over security or system speed.

U.S. District Judge Paula Xinis’ Monday ruling comes after a two-day motion hearing in June, at which PointClickCare said Real Time’s bots violated the company’s user agreements on automated access and slowed down its electronic records management system.

But in her opinion, Judge Xinis largely agreed with Real Time’s argument that PCC was using captcha tests, which are designed to tell humans and bots apart in order to block access for the latter, to instead stifle a competitor as it tried to break into Real Time’s diagnostic analytics marketplace with its own product.

“No evidence supports that PCC had any legitimate good faith use for wholly inscrutable CAPTCHAs which, by definition, blocked Real Time from getting the very records it needs to exist,” Judge Xinis wrote. “But even more damning is the timing of such deployments, which support that PCC used those CAPTCHAs as a device to hamstring or eliminate Real Time as a competitor.”

Claiming that its business is entirely reliant on daily automated access to patient health data — of which PCC is one of the largest electronic warehouses — to develop analytics-based “intervention” recommendations for care providers, Real Time argued in court last month that it couldn’t survive the continued blockading.

Judge Xinis points out in her Monday order that PCC had been looking for ways to break into Real Time’s market for some time, first buying a competitor that went after the same major Maryland state contract for nursing homes and then exploring a potential acquisition of Real Time. It was only once those talks fell through, Real Time claimed, that the captcha tests appeared.

“Once Real Time felt the brunt of the shutdown, PCC offered Real Time an array of business ‘solutions’ that were no solutions at all,” wrote Judge Xinis, who added that the case concerned the “ugly underbelly of electronic access” to healthcare records. “Sure, PCC proposed alternatives that would avoid Real Time’s use of automated software. But none would give Real Time access to more than 30% of the patient data it needed to do its job.”

With that sequence of events, Judge Xinis said, Real Time had done enough to show a likelihood of success on its broader unfair competition and tortious interference claims, which are part of the underlying suit Real Time filed in January. The preliminary injunction granted Monday bars PCC from implementing the tests through the resolution of the litigation.

In a statement to Law360, a spokesperson for PCC said the company planned to appeal Judge Xinis’ ruling. 

“Today’s ruling allows a single company to obtain a backdoor exception to our security policies that negatively impacts the integrity and performance of our system,” the spokesperson said. “This is not only bad for our customers, patients, and caregivers, but it also sets a dangerous precedent for the industry. We disagree with the Court’s decision and intend to file an appeal.”

As for irreparable harm, Judge Xinis held that the risk of losing automated access to patient data it needs to make interventions posed “a real and imminent threat to the company’s continued ability to do business.”

She also wasn’t swayed by PCC’s claims that Real Time’s bots could disrupt its network.

PCC had argued that its network security concerns fell under sanctioned exceptions to the 21st Century Cures Act’s provisions on safe and open “access, exchange, and use of electronic health information.”

But “the record does not establish that bot use by patient analytics companies meaningfully impacts PCC’s performance,” Judge Xinis said. “At best, the record suggests that on one day, PCC’s retrieval system was slow for one facility while Real Time was pulling down reports. … [PCC] introduced no evidence that Real Time’s activities are even associated with slowdowns beyond a single day.”

Finally, Judge Xinis’ ruled that the public interest clearly rested in Real Time’s continued access to patient records, in line with the Cures Act’s interoperability provisions.

“The provision of affordable, quality healthcare depends directly on access to such records,” the judge said.

In a statement to Law360, a spokesperson for Real Time praised the ruling. 

“We are pleased with the ruling and the judge’s confirmation that PCC has been unlawfully blocking our access to patient data,” the spokesperson said. “Real Time’s software has been proven to reduce hospital admissions, pain, and death for patients, and this ruling ensures our software will be able to operate unimpeded for the duration of this case.”

“This is a win not just for Real Time but for patients and the nursing homes responsible for their health and safety,” the spokesperson added.

Real Time Medical Systems is represented by M. Celeste Bruce and Madelaine Kramer Katz of Rifkin Weiner Livingston LLC.

PointClickCare is represented by Brian T. Burgess, William C. Jackson and Ashley M. Drake of Goodwin Procter LLP and Rod J. Rosenstein and Jeremy M. Bylund of King & Spalding LLP.

The case is Real Time Medical Systems Inc. v. PointClickCare Technologies Inc., case number 8:24-cv-00313, in the U.S. District Court for the District of Maryland.

–Editing by Alanna Weissman.