Express Scripts Sues Ernst & Young Alleging Theft of Trade Secrets

Mar 1st 2013
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By Frank Byrt

Express Scripts Holding Company, one of the nation's largest pharmacy benefits managers, has sued its accounting firm, Ernst & Young LLP (E&Y), and one of that firm's former partners, alleging theft of its trade secrets and confidential and proprietary business data. 

The lawsuit asks for "substantial punitive damages" and that Express Scripts be granted an injunction to block E&Y from using or disclosing any of the information, which included product pricing and business strategies, according to court documents filed on February 14 in state court in Clayton, Missouri, near Express Scripts' St. Louis headquarters. 

In its complaint, Express Scripts alleges that Donald Gravlin, then an E&Y health care information technology partner",had been sneaking into Express Scripts' headquarters and stealing confidential and proprietary information belonging to Express Scripts and Medco [which Express Scripts had just acquired] over the course of several months, with assistance from other E&Y partners and employees." 

The theft, which is alleged to have included over 20,000 pages of data, occurred over several months in 2012 and was discovered in August of that year by Express Scripts security team.

The complaint states that Gravlin's motive was "to grow and develop additional business in its health care segment, including potential additional business with Express Scripts, Medco, and their direct competitors." 

According to the complaint: "E&Y is liable for Gravlin's acts because at the time they were committed, Gravlin was an E&Y partner, acting for the benefit of E&Y. . . . E&Y and Gravlin's conduct is even more reprehensible when measured against the importance E&Y purports to place on its clients' data and the professional standards E&Y claims it maintains to protect that data." 

Express Scripts also alleges that E&Y and Gravlin violated Missouri computer tampering and trade secret protection laws. 

In a February 27 prepared statement to AccountingWEB, Amy Call Well, Ernst & Young's director of public relations, said: "[E&Y] will vigorously contest the claims in the complaint. When we were notified about this matter several months ago, we immediately conducted an investigation and concluded there was a violation of E&Y policies and the company's policies. We take client confidentiality seriously. We are fully committed to following our clients' security protocols."

E&Y also said it is not aware of any instance where Express Scripts' data was inappropriately used for any purpose by the accounting firm or its employees, or transmitted to a third party.

An Express Scripts spokesperson told AccountingWEB on February 27 that the company has no statement on the suit beyond what is in the court filing.

An attempt to reach Gravlin was unsuccessful.


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