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In a high-stakes legal showdown, Marshall & Melhorn LLC, an Ohio-based law firm, has made a formidable move to quash a consolidated proposed class action related to a 2021 ransomware attack. The firm contends that potential class members lack the grounds to assert claims, including negligence and unjust enrichment, as they have failed to demonstrate "concrete harm."

Marshall & Melhorn : The Legal Gambit

Marshall & Melhorn took its decisive step for dismissal on Thursday, precisely four months after the lead plaintiffs, Mark Hendrix and Kaitlyn Thiel, initiated their class action suits in the U.S. District Court for the Northern District of Ohio. While Thiel has been able to assert standing on some of her claims, Hendrix has faltered, according to the firm.

Hendrix's legal offensive was launched in the aftermath of Marshall & Melhorn's disclosure of the data breach, which occurred during August and September 2021 and impacted over 27,000 clients. In his 24-page complaint, Hendrix described the perpetual fear gripping him and fellow victims as identity thieves plundered their names, addresses, social security numbers, financial data, passport information, and even medical records.

Days after Hendrix took his legal stand, Kaitlyn Thiel, a former employee of the law firm, followed suit with a more extensive 48-page class action complaint, echoing similar claims on behalf of fellow employees whose data had been stolen during the breach. These claims include allegations of negligence, negligence per se, breach of implied contract, unjust enrichment, and a breach of fiduciary duty.

A Fierce Defense

Marshall & Melhorn, in its motion for dismissal, dissected the two plaintiffs' positions. It asserted that Hendrix had failed to establish a connection between the data breach and any harm he suffered. In contrast, Thiel managed to outline her injuries, such as fraudulent bank charges, unauthorized account access, and an increase in spam calls and emails. However, the firm argued that Thiel's claims were ultimately insufficient to warrant action.

The law firm claimed that the negligence claim could not proceed due to Ohio's economic loss doctrine, which bars recovery in tort for purely economic damages. Marshall & Melhorn discredited Thiel's complaints of "fear, anxiety, stress, inconvenience, and nuisance" as "conjectural," insisting that such types of harm are legally unsupportable.

The firm further contended that negligence per se, premised on an alleged violation of the Federal Trade Commission Act, was infeasible as the FTCA does not provide a cause of action for negligence per se.

Regarding the breach of implied contract claim, Marshall & Melhorn argued that the plaintiffs had not proven the existence of a valid and enforceable contract obliging the law firm to safeguard client information. Thiel was criticized for failing to specify the consideration she provided to the firm in exchange for protecting her private data.

The breach of fiduciary duty claim faced a similar line of attack, with the firm questioning the ability of the plaintiffs to demonstrate the existence of such a duty.

Finally, Marshall & Melhorn asserted that unjust enrichment claims could not hold as they were built on "circular reasoning." According to the firm, the plaintiffs' argument that the law firm benefited from their private data was insufficient to prove unjust enrichment.

Silent Warriors

As of now, neither Hendrix nor Thiel has responded to requests for comment, while a representative for Marshall & Melhorn declined to provide any statement.

Mark Hendrix is represented by Dylan J. Gould and Terence R. Coates of Markovits Stock & DeMarco LLC, Philip J. Krzeski and Bryan L. Bleichner of Chestnut Cambronne PA, and Josh Sanford of Sanford Lawfirm PLLC.

Kaitlyn Thiel is represented by Gary M. Klinger of Milberg Coleman Bryson Phillips Grossman PLLC.

Marshall & Melhorn's legal defense is spearheaded by Jonathan L. Schwartz of Freeman Mathis & Gary LLP.