LHLabcorp

Twenty-three putative class action lawsuits were filed against the Company related to the AMCA Incident in various U.S. District Courts. Numerous similar lawsuits have been filed against other health care healthcare providers who used AMCA. These lawsuits were consolidated into a multidistrict litigation in the District of New Jersey. On November 15, 2019, the Plaintiffs filed a Consolidated Class Action Complaint in the U.S. District Court of New Jersey. The consolidated Complaint generally alleged that the Company did not adequately protect its patients’ data and failed to timely notify those patients of the AMCA Incident. The Complaint asserted various causes of action, including but not limited to negligence, breach of implied contract, unjust enrichment, and the violation of state data protection statutes. The Complaint sought damages on behalf of a class of all affected Company customers. On January 22, 2020, the Company filed Motions to Dismiss all claims. On December 16, 2021, the court granted in part and denied in part the Company’s Motion to Dismiss. On March 31, 2022, the Plaintiffs filed an Amended Complaint alleging claims for negligence, negligence per se, breach of confidence, invasion of privacy, and various state statutory claims, including a claim under the California Confidentiality of Medical Information Act. The Company filed a Motion to Dismiss certain claims of the Amended Complaint. On May 5, 2023, the court granted in part and denied in part the Company’s Motion to Dismiss. On November 1, 2024, Plaintiffs served their motion for class certification. The Company will vigorously defend the remaining claims in the multi-district litigation.

The Company receives, collects, stores, transmits, and processes certain personal and financial information about its customers. In addition, the Company depends upon the secure transmission of confidential information over public networks, including information permitting cashless payments. The Company also information, and works with third-party service providers and vendors that provide technology systems and services that are used in connection with the receipt, storage, transmission, and such data processing of customer personal and financial information. activities. A compromise of the Company’s systems, or those of the Company's third-party service providers and vendors, a vendor’s systems that results in customer personal confidential information being obtained acquired, accessed, or altered changed by unauthorized persons, or the Company’s third party's failure to comply with meet security requirements, including but not limited to standards, such as the HIPAA security standards for payment cards (e.g., regulations and the Payment Card Industry Data Security Standard), Standard, could adversely affect harm the Company’s reputation with its customers and others, as well as the Company’s results of reputation, operations, financial condition condition, and liquidity. It could also liquidity, and may result in litigation against the Company and the imposition of fines and penalties. litigation, fines, or regulatory actions. For example, in connection with the AMCA Incident (as defined below under “Cybersecurity” in Item 1C) the Company has incurred, and expects to continue to incur, resulted in costs, and the Company is involved in pending and threatened litigation, as well as various government and regulatory inquiries and processes. inquiries. For additional information about the AMCA Incident, see Note 15 Commitments and Contingencies to the Consolidated Financial Statements of Part III of the Annual Report.

The change in Other, net for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily due to $80.0 the TSA expiration resulting in a $76.2 decrease of transition services fees charged to Fortrea for the year ended December 31, 2025, as compared with the corresponding period in 2024, related to the provision of administrative and IT information technology systems support. The costs to provide these transition services are were included in operating Operating income, but the service fees are were included in other income. Other, net. In addition, there were net investment losses of $42.6, recorded during the Company recorded year ended December 31, 2025, compared to net investment losses of $11.4 for the corresponding period of 2024, which are primarily driven by a $6.4 gain related decrease in the value of investments in other companies or investment funds that develop technology relating to the divestiture of Beacon Laboratory Benefit Solutions, Inc. This income was partially offset by foreign currency transaction losses of $15.3 and an $11.4 loss on investments. Company’s operations.