Common use of FACTUAL BACKGROUND AND RECITALS Clause in Contracts

FACTUAL BACKGROUND AND RECITALS. 1. Plaintiffs allege that in May 2021, IWP discovered unauthorized access to certain email accounts (the “Data Incident”), beginning in January 2021. Plaintiffs alleged that the Data Incident resulted in the potential exposure of certain personally identifiable information (“PII”) and personal health information (“PHI”) of IWP’s current and former customers. Specifically, the following types of PII were allegedly exposed: name, address, date of birth, email address, Social Security number, driver’s license, payment card information, financial account information, patient identification number, medical record number, treating or referring physician, treatment information, prescription information, health insurance information, and Medicare or Medicaid number. In February 2022, IWP began notifying Plaintiffs and the Settlement Class about the Data Incident. 2. On May 24, 2022, Plaintiffs, individually and on behalf of a putative class, filed the Litigation, alleging the following claims: negligence, negligence per se, breach of implied contract, unjust enrichment, invasion of privacy, and breach of fiduciary duty. 3. Following full briefing, the Court granted IWP’s motion to dismiss Plaintiffs’ claims. Plaintiffs appealed that ruling to the First Circuit Court of Appeals, which reversed in part and remanded. 4. After additional motion to dismiss briefing, the Court ruled that Plaintiffs’ negligence and breach of fiduciary duty claims could proceed. 5. On March 5, 2024, after a period of informal discovery and mutual exchange of information, the Parties engaged in a private mediation with Judge ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (▇▇▇.) from JAMS, an experienced mediator. Throughout their mediation session, the Parties engaged in an extensive evaluation and discussion of the relevant facts and law, and the Parties carefully considered the risk and uncertainties of continued litigation and all other factors bearing on the merits of settlement. Although the mediation did not result in a settlement, the parties continued their negotiations and, in the following weeks, succeeded in reaching agreement on the principal terms of a settlement—subject to final mutual agreement on all the necessary documentation. 6. The Parties have agreed to settle the Litigation on the terms and conditions set forth herein in recognition that the outcome of the Litigation is uncertain and that achieving a final result through litigation would require substantial additional risk, uncertainty, discovery, time, and expense for the Parties. 7. IWP denies all claims of wrongdoing or liability that Plaintiffs, Settlement Class Members, or anyone else have asserted in this Litigation or may assert in the future based on the conduct alleged in the complaint. Despite IWP’s position that it is not liable for, and has good defenses to, the claims alleged in the Litigation, IWP desires to settle the Litigation, and thus avoid the expense, risk, exposure, inconvenience, uncertainty, and distraction of continued litigation of any action relating to the matters being fully settled and finally resolved and released in this Settlement Agreement. Neither this Settlement Agreement, nor any negotiation or act performed or document created in relation to the Settlement Agreement or negotiation or discussion thereof is, or may be deemed to be, or may be used as, an admission of, or evidence of, any wrongdoing or liability. 8. The Parties now enter into this Settlement Agreement. Plaintiffs and Class Counsel have conducted an investigation into the facts and the law regarding the Litigation and have concluded that a settlement according to the terms set forth below is fair, reasonable, and adequate, and beneficial to and in the best interests of Plaintiffs and the Settlement Class, recognizing: (1) the existence of complex and contested issues of law and fact; (2) the risks inherent in litigation; (3) the likelihood that future proceedings will be unduly protracted and expensive if the proceeding is not settled by voluntary agreement; (4) the magnitude of the benefits derived from the contemplated settlement in light of both the maximum potential and likely range of recovery to be obtained through further litigation and the expense thereof, as well as the potential of no recovery whatsoever; and (5) Plaintiffs’ determination that the settlement is fair, reasonable, adequate, and will substantially benefit the Settlement Class Members. 9. Considering the risks and uncertainties of continued litigation and all factors bearing on the merits of settlement, the Parties are satisfied that the terms and conditions of this Settlement Agreement are fair, reasonable, adequate, and in their respective best interests. 10. In consideration of the covenants, agreements, and releases set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is agreed by and among the undersigned that the Litigation be settled and compromised, and that the Releasors release the Released Parties of the Released Claims, without costs as to Released Parties, Plaintiffs, Class Counsel, or the Settlement Class, except as explicitly provided for in this Settlement Agreement, subject to the approval of the Court, on the following terms and conditions.