Dive Brief:
- Health IT vendor Cerner has signed a settlement agreement with Trinity Medical Center in Minot, N.D. over patient accounting software that Trinity said was defective.
- In the suit Trinity asked for $240 million in damages, while Cerner said $4 million should be sufficient.
- The final settlement, which was obtained through arbitration, has not been disclosed, but it's large enough to force Cerner to take an $0.18 to $0.19 per share charge against earnings for the quarter ending Dec. 28, 2013.
Dive Insight:
You seldom see cases in which a hospital receives a large settlement from an IT vendor -- Cerner, for its part, says that the settlement was "the only material judgment against [the company] in its 34-year history" -- largely because vendors typically do a good job of dumping liability on its customers. (One has to wonder what loophole in its contract backed Cerner so far in a corner that it had to pay out.) Wall Street will get over this, and so will Cerner, but it's definitely a meaningful event.