Motive in Alleged Data Theft a Mystery; Express Scripts Says That Ernst & Young and Its Partner, Donald Gravlin, Conspired to Steal Company's Secrets

By Doyle, Jim | St Louis Post-Dispatch (MO), February 22, 2013 | Go to article overview
Save to active project

Motive in Alleged Data Theft a Mystery; Express Scripts Says That Ernst & Young and Its Partner, Donald Gravlin, Conspired to Steal Company's Secrets


Doyle, Jim, St Louis Post-Dispatch (MO)


For more than a decade, Donald Gravlin was a rising star in the consulting world a leading expert on health data management and technology.

Gravlin, 46, most recently a principal in the health care advisory practice at Ernst & Young, has been quoted in trade magazines as an authority on arcane topics such as electronic health record systems, medical devices, wireless LANs, blade computing, e- learning, and optical character recognition software.

Now, the technology guru and health care consultant is viewed as someone who may have stepped over the line, violating the basic ethical precepts of the accounting and consulting professions.

Express Scripts Holding Co., the nations largest pharmacy benefit manager, has accused Gravlin of penetrating the corporate giants headquarters in north St. Louis County and stealing a massive trove of secret documents.

In a lawsuit filed last week in St. Louis County Circuit Court in Clayton, Express Scripts accused Big Four accounting firm Ernst & Young and Gravlin of misappropriating the equivalent of 20,000 pages of confidential information and trade secrets in an effort to win more health care-related business from Express Scripts and its competitors.

Ernst & Young and Gravlin were possessed with an evil motive, the suit alleges. E&Y and Gravlin engaged in unlawful and malicious competitive intelligence gathering.

The FBI is investigating the matter.

Once we became aware of the issue, we did turn it over to the FBI for further investigation, Express Scripts spokesman Brian Henry said in an email. Federal law enforcement is taking this case very seriously and looking into it thoroughly.

The U.S. attorneys office in St. Louis declined to comment.

Express Scripts lawsuit, which asks for punitive damages, said those secrets include competitively sensitive cost and pricing information ... highly proprietary projections and integration strategy documents ... and highly proprietary business strategy and performance metrics documents.

In other words, the secrets are the keys to Express Scripts breakaway success. The alleged thefts occurred around the time when the pharmacy benefit manager was completing its $30 billion acquisition of its chief rival, New Jersey-based Medco Health Solutions Inc.

The suit itself was astonishing because Express Scripts is considered such a tightly managed company. Its gleaming headquarters on the campus of the University of Missouri-St. Louis is a virtual fortress. And at Express Scripts nearby mail-order facility, guests are forbidden from photographing the robotic machinery.

Judson Clark, an investment analyst at Edward Jones & Co. in Des Peres, said the allegedly stolen data was highly prized. This is the first time Ive seen something like this, he said. For (pharmacy benefit management) companies, their pricing information is their business. ... If you could go contract by contract and piece together their pricing strategy, youd have an advantage in the market.

Jeff Jonas, an analyst at Gabelli & Co, an investment management firm in Rye, N.Y., called such allegations relatively rare. ... It also seems like a stretch that Ernst & Young would be complicit. I imagine there were pretty strict confidentiality and nondisclosure agreements. And it seems like the data is going to stay private and not be that big of an issue.

Ernst & Young, which has denied any wrongdoing, was hired to assist Express Scripts with tax accounting work and the tax-related aspects of its merger with Medco. Express Scripts consummated its purchase of Medco in April 2012. The consulting arrangement came to end in September after the alleged theft was discovered.

If, God forbid, he did this, its a very serious matter. It would be jail time and very heavy fines, said Alan Reinstein, a professor of accounting at Wayne State University in Detroit. But the case doesnt pass my smell test.

Ive never heard of this happening before.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

Motive in Alleged Data Theft a Mystery; Express Scripts Says That Ernst & Young and Its Partner, Donald Gravlin, Conspired to Steal Company's Secrets
Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?