HIMSS will pay $2.8 million to settle a proposed class-action lawsuit against it for unrefunded fees related to the cancellation of its 2020 annual conference and exhibition.
The settlement is between the Healthcare Information and Management Systems Society; HatchMed, a technology company that was registered to exhibit at the 2020 trade show; and Novarad, another healthcare technology company added later to the case as a plaintiff. HatchMed and Novarad are representing exhibitors who did not receive refunds following the cancellation of the show, according to Modern Healthcare
"Unlike other industrywide tradeshows, HIMSS decided to utilize its cancellation as an unauthorized cash grab, as it unilaterally determined to keep the money that its exhibitors paid," HatchMed wrote in its June complaint.
HIMSS canceled its 2020 show days before it was to start due to COVID-19. Instead of refunding exhibitors and sponsors, the organization offered a deal where 15% of a company or individual’s 2020 fees would go toward their participation in the 2021 conference and 10% in 2022. HatchMed will be filing its suit in Illinois Federal Court in June. A judge granted preliminary approval on Friday for the class, which could represent more than 850 entities.
Under the settlement, HIMSS will set up a $2.8 million fund to pay members of the settlement class for exhibit space, meeting space or sponsorships at the 2020 show. Rewards will go to those who have not settled and released their claims and will be distributed through either a cash-credit option or a credit-only option.
For those who go with the cash-credit option, HIMSS will pay back 20% of 2020 exhibit fees in cash and credit 30% toward fees for the 2021 trade show and 10% for the 2022 trade show. The credit-only option credits 50% of a member’s 2020 fees toward their fees in 2021 and 10% to 2022.
"We are pleased with the result, and our firm is proud to have pursued this action to obtain the significant benefit to the class spelled out in the settlement agreement," Peyton Healey, counsel for HatchMed and Novarad of Hedrick Kring, PLLC, told HCB News.
HIMSS announced its intention in July to push back the date of its 2021 conference from March to August due to the pandemic, and plans to make it a hybrid event with options to participate online or in person.
“HIMSS confirms a settlement agreement has been reached with class members in the lawsuit HatchMed Corp. and Novarad Corp. v. Healthcare Information and Management Systems Society, Inc.,” Karen Groppe, senior director of strategic communications for HIMSS, told HCB News. “Documents reflecting the negotiated resolution have been filed with the court for preliminary approval and HIMSS looks forward to finalizing the matter. Because this is still an active legal case, HIMSS has no additional comment at this time.”
The court will hold a hearing to determine whether to approve the settlement in June.