A Breach of Contract

Corporate changes and turnovers are often fertile ground for contractual disputes, and the bigger the players involved, the more potential there is for large-scale issues.

Target Corp., a giant U.S. based retailer, has pursued their Canadian expansion by buying out the leases on the Canadian store who would be their direct rival – Zellers. As part of that deal, they had the option to buy the pharmaceutical records from the existing Zellers’ pharmacies. It was an option they chose not to pursue, and so the question arose of what would happen to those records.

Zellers has chosen to sell the records of about 95 of their existing locations to Loblaws for close to $35 million. They’ve sold the records for another seven pharmacies to Metro for an undisclosed amount.

That means that patient records, some of whom have been in the same pharmacy for decades, will go to new locations without the consent of either the pharmacists or the patients themselves.

Breach of Contract?

Nine of the pharmacists in question have decided to fight back, suing Zellers for breach of contract as well as seeking an injunction to prevent the sale that involves thousands of patient records. The pharmacists claim that Zellers has no right to the records, and also that the sale violates privacy laws. Their suits are valued at $3 million each.

Zellers, in turn, is countersuing, taking the position that its licensing agreement gives it ownership of the files and therefore the right to sell them. They also claim that the pharmacists are hindering their ability to transfer the files by taking down signs that advise patients of the transfer.

At Issue

The salient point in this case will lie in determining legal ownership of the records, looking at the licensing agreement itself and its wording, among other issues that may arise such as patient rights.

In this era when corporate takeovers are common, you may find yourself in a situation where your contractual rights are threatened or brought into question. Don’t get caught up in corporate maneuvering – know your rights and how to protect them.

Get the Legal Representation You Need

Know your rights. Contact the breach of contract lawyers at Petrillo Law today by calling (905) 949-9433. We look forward to hearing from you.

We are located at 2600 Skymark Ave., Unit 1, Suite 201, Mississauga, Ontario, L4W 5B2

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