Privacy & Information Security Law Blog

On January 5, 2015, the Alameda County District Attorney’s Office announced that Safeway Inc. (“Safeway”) has agreed to pay $9.87 million to settle claims that the company unlawfully disposed of customer medical information and hazardous waste in violation of California’s Confidentiality of Medical Information Act and Hazardous Waste Control Law. In a series of waste inspections from 2012 to 2013, a group of California district attorneys and environmental regulators found that Safeway was disposing of both its pharmacy customers’ confidential information and various types of hazardous wastes in the company’s dumpsters. Based on the investigation, 42 California district attorneys and two city attorneys brought a complaint on December 31, 2014, alleging, among other things, that more than 500 Safeway stores and distribution centers engaged in the disposal of their customers’ medical information in a manner that did not preserve the confidentiality of the information.

The settlement calls for Safeway to pay (1) a $6.72 million civil penalty, (2) $2 million for supplemental environmental projects and (3) $1.15 million in attorneys’ fees and costs. In addition, pursuant to the agreement, Safeway must maintain and enhance, as necessary, its customer record disposal program to ensure that customer medical information is disposed of in a manner that preserves the customer’s privacy.