Recent FTC Cybersecurity Settlements Highlight Benefits and Risks of Settling vs. Litigating

Amidst mounting pressure to pursue cybersecurity more aggressively, the Federal Trade Commission (“FTC”), the federal government’s most active enforcer in the space, has recently imposed increasingly stringent cybersecurity requirements in its consent orders. Given that FTC consent orders typically carry 20-year terms and a potential fine of $42,530 (which the FTC may contend applies to each consumer subject to a breach), it is vital for companies faced with an FTC cybersecurity investigation to take every possible step to narrow the scope of relief requested by the FTC. Several recent FTC cybersecurity settlements illustrate an emerging pattern: a company that litigates may secure a better deal than it would have received in an initial settlement, if not defeat the action entirely. But when considering whether to settle or litigate with the FTC, companies must still balance the various legal, business, and reputational risks at stake.

How the decision to settle or litigate can directly affect the relief imposed is evident in the FTC’s 2019 cybersecurity settlements: Unixiz, ClixSense, LightYear, Equifax, and D-Link. READ MORE

Orrick Webinar: Spotlight on EdTech – How the New California and Nevada Privacy Laws Will Impact Data in EdTech

Webinar | August 27, 2019 | 12pm – 1pm (Eastern Standard Time)

Please join Emily Tabatabai and Sulina Gabale for the Cyber, Privacy & Data Innovation practice’s webinar, “Spotlight on EdTech – How the New California and Nevada Privacy Laws Will Impact Data in EdTech.
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Orrick Webinar: Spotlight on Fintech – How the New California and Nevada Privacy Laws Will Impact Data in Fintech

Webinar | July 30.2019

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Please join Heather Sussman, Barrie VanBrackle and David Curtis for the Cyber, Privacy & Data Innovation practice’s webinar, “Spotlight on Fintech – How the New California and Nevada Privacy Laws Will Impact Data in Fintech.”

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New law decreases the number of companies required to designate a Data Protection Officer in Germany

On June 28, 2019, the German parliament (Bundestag) passed new legislation imposing several changes to the current German Federal Data Protection Act (“BDSG”).  Although many of the changes addressed privacy aspects of criminal proceedings, the new legislation makes an important change for small companies by increasing the threshold to designate a Data Protection Officer (“DPO”). Whereas currently companies have to designate a DPO if they constantly employ at least 10 employees who deal with the automated processing of personal data, the new legislation increases the minimum number of employees from 10 to 20, significantly decreasing the financial and administrative burden for small companies doing business in Germany. This article explains the changes and their impact and explains what companies should do.

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State Legislatures Continue to Update Breach Notification Laws

While the California Consumer Privacy Act (“CCPA”) has inspired many states to consider their own consumer privacy bills, including Nevada which recently enacted a new law, not to be lost in the CCPA-focused frenzy is the fact that states continue to revise their data breach notification statutes. In recent weeks, the new Massachusetts breach notification amendment has gone into effect, New Jersey, Maryland, Oregon, Texas, and Washington have enacted their own breach notification amendments, and Illinois has proposed a bill that is poised to become law in the near term. READ MORE

Orrick Webinar: New U.S. Privacy Laws – What Companies Need to Know

Webinar (recording available) | June.25.2019

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Please join Heather Sussman and Matthew Coleman for the Cyber, Privacy & Data Innovation practice’s webinar, “California’s and Nevada’s New Privacy Laws – What Companies Need to Know.”

California was the first U.S. state to enact a sweeping new privacy law, known as the CCPA, with an effective date of January 2020. Nevada has now enacted a scaled-down version of the CCPA that is slated to take effect even sooner – as early as October 2019.
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Nevada Passes Opt-Out Law, Effective October 2019 – Three Months Before the CCPA

Following in California’s footsteps, Nevada has passed a new privacy law providing consumers the right to opt out of the sale of their personal information. Senate Bill 220 (SB-220), signed into law by Governor Steve Sisolak on May 29, 2019, amends Nevada’s existing online privacy statute, NRS 603A.340, to include a requirement that online operators provide consumers with a means to opt out of the sale of specific personal information collected by websites or online services. The act goes into effect on October 1, 2019 – three months ahead of the January 1, 2020 effective date of the California Consumer Privacy Act (CCPA) – which may force companies to fast track implementation efforts for opt-out requests in particular. READ MORE

Putting Individuals In The (Urth)Box: FTC Goes After Individual Executives For Unfair And Deceptive Practices

In an increasing trend, the Federal Trade Commission (FTC) joined other federal regulators seeking to hold individuals – not just companies – liable in enforcement proceedings. The most recent target was San Francisco-based UrthBox, Inc. and its principal, Behnam Behrouzi. Specifically, Urthbox and Behrouzi agreed to settle FTC allegations that UrthBox engaged in unfair or deceptive acts or practices by: (1) failing to adequately disclose key terms of its “free trial” automatic renewal programs, and (2) misrepresenting that customer reviews were independent when, in fact, UrthBox provided customers with free products and other incentives to post positive reviews online.[1]

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Supreme Court Leaves Standing for Privacy and Cybersecurity Cases Unresolved

Privacy & Cybersecurity Litigation partner Michelle Visser, counsel David Cohen and associate Nicole Gelsomini authored this blog post for the Washington Legal Foundation on the unsettled state of the law on constitutional standing in privacy and cybersecurity cases in the wake of two recent Supreme Court developments. Constitutional standing challenges are, and will continue to be, an important potential tool for privacy and cybersecurity defendants seeking to dismiss certain class actions brought in federal court. To establish standing, a private plaintiff must show, among other things, that he or she faces an actual or imminent concrete injury from the defendant’s conduct. As explained in the Washington Legal Foundation post, however, the Supreme Court recently passed on two chances to clarify the test that will govern this standing inquiry, leaving defendants to wade through conflicting and ambiguous lower court precedent. The uncertain and nuanced state of this area of law underscores the importance of retaining experienced cybersecurity and privacy defense counsel when faced with this type of suit.

2019 IAPP Global Privacy Summit: Lessons from GDPR, Plans for CCPA and the Future of U.S. Privacy Law

At the beginning of this month, more than 4,000 privacy professionals from around the globe gathered in Washington, D.C. for the International Association of Privacy Professionals’ Global Privacy Summit 2019. The conference focused on lessons learned from the first year of GDPR enforcement in Europe, the expansion of European-style rights to more jurisdictions around the world, plans for addressing new obligations imposed by the CCPA in California, and the future of privacy law in the United States including whether federal legislature is likely or desired – especially in light of the CCPA and similar proposed legislation in states throughout the nation. READ MORE