Patient portal vendor Medfusion has filed a legal complaint against health IT vendor Allscripts. The lawsuit, filed May 15 in Wake County, N.C., is seeking millions of dollars in damages for breach of contract and fraud, among other allegations. 

"We had negotiated to take our relationship with Allscripts to another level and Allscripts did not meet many of the commitments that we laid out there and it really impacted our ability to deliver for customers," says Steven Malik, CEO of Medfusion. "The basis of the claim is really three things: Allscripts didn't meet its development commitments, which directly impacted our ability to deliver innovation to clients; Allscripts didn't meet its sales and marketing commitments; and there's a payment issue as well given that they withheld payment to us."   

Under a five-year business agreement that was to set to expire in July, Chicago-based Allscripts had agreed to market and sell Medfusion's patient web portal. However, last month, Medfusion announced that it had ended its business relationship with Allscripts. The Cary, N.C.-based company, which offers patient portal and website solutions to healthcare providers, had been a partner of Allscripts since 2009 and was providing its portal to approximately 30,000 Allscripts providers. 

But, according to Malik, Allscripts "aggressively marketed their own solution to our customers that they had contractually committed to us as their only preferred portal to be included by default with virtually every account." He contends that Medfusion now clearly sees Allscripts as a competitor.

In February 2013, Allscripts acquired cloud-based patient and consumer engagement vendor Jardogs--a competitor of Medfusion--and the rights to the company's patient portal called FollowMyHealth. Medfusion's lawsuit alleges that "Allscripts did not wait until its contractual obligations owed to Medfusion ended in July 2014 before beginning to make FollowMyHealth available across its products."

In response to a query from Health Data Management, an Allscripts spokesperson said the company "does not comment on outstanding litigation" and that its "focus is, as always, on our clients and providing them with the best possible population health and healthcare information technology solutions."

The 30,000 Allscripts providers who currently use Medfusion’s portal technology have been given an opportunity to secure direct service from Medfusion. "We are giving the customers a free month [through the end of May] to make a decision and weigh their options" as well as "offering them the ability to go month-to-month with us," Malik says.

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