In a significant ruling among the first to analyze the application of information blocking regulations, the U.S. Court of Appeals for the Fourth Circuit affirmed a preliminary injunction against an EHR company in favor of a diagnostic analytics services company. The injunction grants the analytics company access to patient data, enabling the company to provide its analytics services to nursing facility customers who use the EHR vendor’s services.

The case, Real Time Medical Systems, Inc. v. PointClickCare Technologies, Inc., No. 24-1773 (4th Cir. 3/12/25), arises out of claims by Real Time Medical Systems, Inc. (“Real Time”) that PointClickCare Technologies, Inc. (“PCC”) implemented a technical protocol that cut-off Real Time’s appropriate access to its customers’ electronic health information (“EHI”) and that PCC did not implement this protocol for legitimate security or performance reasons as PCC claimed, but rather to interfere with Real Time’s business so that PCC could capture Real Time’s market share with its own competing analytics products.

The decision by the Fourth Circuit underscores the critical need to ensure the appropriate access, exchange, and use of EHI. The decision also highlights that, to seek protection under a regulatory exception to the prohibition on information blocking, entities must implement well-documented practices tailored to the law, basing those practices on objective and verifiable criteria, and applying the criteria consistently and in a non-discriminatory manner.

In rejecting PCC’s appeal challenging the preliminary injunction, the court found that PCC’s use of indecipherable CAPTCHAs and blocking of Real Time user accounts likely constituted information blocking under the 21st Century Cures Act—i.e., a practice that interferes with, prevents, or materially discourages access, exchange, or use of EHI.

The opinion analyzes PCC’s reliance on several exceptions to the information blocking regulations:

Manner Exception (45 C.F.R. § 171.301): This exception allows an actor to fulfill a request for EHI in an alternative manner if it is technically unable to fulfill the request in the manner requested or cannot reach agreeable terms with the requestor. The court found that PCC did not demonstrate a good-faith effort to reach agreeable terms with Real Time and had ended discussions prematurely without justification, reflecting bad-faith negotiation rather than an actual impasse. The court noted that PCC cited no technical issues preventing data access and that simply refusing the request, without technical barriers, does not satisfy the manner exception.

Health-IT Performance (45 C.F.R. § 171.301) and Security (45 C.F.R. § 171.203) Exceptions: These exceptions require actions to be narrowly tailored to required conditions under the law and implemented in a consistent and non-discriminatory manner for the benefit of the overall performance of the health IT, or to protect the security of EHI, respectively. The court noted that Real Time’s operations constituted only a small fraction of PCC’s overall system usage, casting doubt on claims of a significant health IT performance impact performance. The court also stated “[t]here is no evidence that Real Time’s use of bots in PointClickCare’s system has ever led to any security breach; in fact, there is no evidence of a security breach experienced by Real Time at all.”

The court also concluded that PCC’s actions were not consistent and non-discriminatory, as evidenced by the inconsistent application of CAPTCHAs and the timing of these actions coinciding with competitive pressures. Indeed, the court commented that the timing and pattern of enforcement, including the inconsistent application of CAPTCHAs—aligning with PCC’s market entry and sensitive discussions with Real Time—suggested targeted conduct.

The court affirmed that Real Time is likely to succeed on the merits of its unfair competition claim, would suffer irreparable harm without the injunction, and that the balance of equities and public interest favored granting the injunction.

The ruling highlights the pitfalls of attempting to use the information blocking regulations as a shield and serves as a critical reminder for regulated actors to remain vigilant in their practices around data access to ensure compliance and avoid legal pitfalls.

Reed Smith will continue to follow litigation trends and developments with regard to information blocking enforcement. If you have questions please do not hesitate to reach out to the author or any of the health care lawyers at Reed Smith.