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CU System
Panel to hear Heartland case today
LOUISVILLE, Ky. (5/27/09)--The U.S Judicial Panel of Multidistrict Litigation will convene a national panel of seven judges today in Louisville, Ky., to hear oral arguments in the Heartland Payment Systems data breach lawsuit. The panel will decide whether the case should be rolled into class action lawsuits. The panel’s decision will impact credit unions involved in litigation against the company. Actions against Heartland Payment Systems were filed in 12 U.S. district courts. The MDL panel was created by an Act of Congress in 1968, according to its website. The panel will determine whether civil actions pending in different federal districts involve one or more common questions of fact. If so, the actions could be transferred to one federal district for coordinated or consolidated pretrial proceedings. The panel also will select the judge or judges and court assigned to conduct such proceedings. Centralizing the court process would avoid duplication of discovery, prevent inconsistent pretrial rulings, and conserve the resources of the parties, their counsel and the judiciary. Heartland Payment Systems has spent or earmarked more than $12.6 million to cover costs associated with the widespread intrusion of its data systems discovered in January, according to CEO Robert Carr (Computerworld May 18). As of March 2, more than 560 financial institutions, including at least 178 credit unions, had to reissue credit and debit cards as a result of the Heartland breach. Three credit unions joined two banks in a class action lawsuit against Heartland to recoup losses related to the breach announced Jan. 20 (News Now March 2). The credit unions are: GECU, a $1.146 billion asset credit union in El Paso, Texas; MidFlorida FCU, a $1.283 billion asset credit union in Lakeland, Fla.; and Matadors Community CU, a $123 million asset credit union in Chatsworth, Calif., according to documents filed in court. They join Amalgamated Bank of New York, N.Y., and Farmers State Bank, headquartered in Marcus, Iowa, in the complaint, which was filed Feb. 20 in the U.S. District Court, Trenton, N.J., by Chimicles & Tikellis LLP, Haverford Pa., the lead attorneys in the case. They are seeking to recoup money for the cost of reissuing cards to their members/customers and for their costs related to fraudulent activity stemming from the breach.
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