4 Additional Class Actions Are Transferred to MOVEit MDL

Four more class actions -- three against Progress Software Corp. (PSC) and one against Health Care Service Corp. -- were transferred to In Re: MOVEit Customer Data Security Breach Litigation in conditional transfer order 28 (CTO-28), said a Wednesday Judicial Panel on Multidistrict Litigation clerk order. The order is stayed seven days from entry to allow any party to file a notice of opposition, it said.

The four negligence lawsuits in CTO-28 are Mirshokri v. Progress Software (docket 3:24-cv-00387), which also names Blue Shield of California and EyeMed Vision Care as defendants; Rehm v. Progress Software (docket 1:24-cv-01014), also naming Welltok and OSF Healthcare System; Weaver v. Progress Software (docket 2:24-cv-10157), also naming Welltok and Beaumont Health; and Slaughter v. Health Care Service (docket 1:24-cv-00560). The cases involve questions of fact related to PSC’s May MOVEit file transfer software data breach that are common to the actions previously transferred to the District of Massachusetts and assigned to Judge Allison Burroughs, it said.

In a Tuesday response to defendant Clearesult Consulting’s motion to vacate CTO-24 (see 2401090065), PSC counsel Jeffrey Tsai of DLA Piper said transfer of Dauch v. Clearesult is warranted because the action shares common questions of fact with cases in the MDL and transfer “will promote the just and efficient conduct of this litigation.” The panel has already ruled that the MOVEit vulnerability “is at the core of all cases” such that it would be “impossible” “to “disentangle the allegations against Progress ... from the allegations against other defendants,” said PSC's response.

Clearesult doesn’t dispute those findings and doesn’t argue that it will not seek discovery from PSC in the Dauch action, it said. Its reason justifying exclusion from the MDL is a pending motion to dismiss Dauch before the Western District of Texas, it said. Clearesult’s “apparent belief that this case will be dismissed on a motion to dismiss is not unique -- and it does not change the calculus,” said the response. Many defendants “share that same belief as to their own cases,” but as a preliminary matter, Burroughs “is equally capable of determining the motion to dismiss,” it said.

Presuming the outcome of a motion to dismiss “simply puts the cart before the horse,” said PSC’s response, saying one reason for an MDL is to “create an efficient way for addressing issues that are common to these cases at the pleadings stage as well as in discovery.” If Dauch fails as a matter of law, “that will be true even if the action is centralized into the MDL; if the action survives dismissal, it will benefit from the efficiencies of being centralized with the other actions that have 'the MOVEit vulnerability ... at [their] core,'” it said. Once the Dauch action is transferred to the MDL, Clearesult can request that Burroughs “sever and remand its claims,” the response said.

Plaintiff Jason Dauch also opposes Clearesult’s motion to vacate, said his Tuesday response before the JPML. Aside from hoping that the Western District of Texas’s ruling will dispose of the action, Clearesult “never explains why the Western District of Texas is better equipped or more capable of resolving its motion than the District of Massachusetts which oversees the centralized litigation,” said the response. “Given the ‘common and complex factual questions as to how the MOVEit vulnerability occurred, the circumstances of the unauthorized access and data exfiltration, and Progress' response to it,'" plus the response of various downstream MOVEit users and customer-facing defendants, "the Western District of Massachusetts should be afforded the opportunity to rule on Defendant’s motion in the first instance,” it said.