Arizona court says Costco can be sued over ED drug disclosure

Legal Issues

The Arizona Court of Appeals has ruled that the Costco warehouse store chain can be sued for privacy violations by a Phoenix-area man because a pharmacist joked with his ex-wife about an erectile dysfunction prescription he had never picked up.

The ruling issued Tuesday revived the lawsuit the man filed after the pharmacist told his ex-wife about the prescription when she went to pick up another prescription with his approval. The man had called Costco twice to cancel the prescription before his ex-wife went to the north Phoenix store in early 2016, but the pharmacist did not do so, according to the ruling.

Attorney Joshua Carden filed the lawsuit for the man alleging a variety of violations, but it was dismissed by a trial-court judge. The Court of Appeals revived sections alleging negligence under federal health care privacy law commonly called HIPAA. The ruling potentially allows him to seek punitive damages.

The ruling is the first to say that negligence claims under HIPAA can be brought in Arizona courts, Carden said.

“If there is a big deal in the case it’s that the court went ahead and said yes to negligence claims based on HIPAA violations,” Carden said. “That’s not ever been announced in Arizona before.”

The federal health privacy law doesn’t allow individuals to sue for violations in federal court, he said, and state courts haven’t always been clear about that right.

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