Data Breach

Class Actions For Security Breaches Are Here To Stay

Today’s decision by the Supreme Court to allow the appeal in WM Morrison Supermarkets plc v Various Claimants may on first glance look like a significant setback to privacy advocates. However, the court’s unanimous judgment should be viewed with some relief by those arguing for greater privacy protections. Whilst the Supreme Court ruled that, on the facts, WM Morrisons Supermarkets plc (“Morrisons”) could not be held liable for the actions of its rogue former employee, the court said that, had it been necessary to decide the question, it would have held that the statutory data protection regime did not exclude the imposition of vicarious liability on employers. Furthermore, the decision also provides no protection to companies who have been held to be at fault for a data breach, since data subjects will have a direct right of action against the company in those cases and will not be relying on establishing vicarious liability. READ MORE

How to Move to Remote Work and Comply with U.S. Privacy and Cybersecurity Laws

Cybercriminals are known to attack networks and individuals at inopportune times of crisis—and the coronavirus pandemic unfortunately presents just such an opportunity as millions are accessing corporate networks and databases from home. This past weekend New Jersey and Connecticut joined the growing list of jurisdictions (e.g., California, Delaware, Illinois, Louisiana, Ohio, and New York) to issue orders effectively requiring non-essential workers to avoid the workplace, and in some cases, to shelter-in-place. READ MORE

ICO FINES: WHEN IS AN APPEAL APPEALING?

The decision to appeal a regulatory finding is never taken lightly. By the time a regulator has completed its investigation and notified a company of its intention to fine, the company will have invested significant time and money in responding to the regulatory investigation. As such, there is a real temptation to accept the fine and the accompanying statement from the regulator and move on.

However, in the case of recent regulatory findings, fines and intentions to fine issued by the UK’s Information Commissioner’s Office (the “ICO”) against British Airways, Marriott and Dixons Carphone, all three  companies have appealed or indicated an intention to appeal despite the significant difference in the levels of the fines/intentions to fine. In our view, this is related to the spectre of an emerging class action litigation culture in the UK that increases the stakes for any company facing negative regulatory findings.

In this UK-focused blog we explore the potential motivation behind these decisions to appeal, why we expect to see more companies taking this approach in the future, and the steps to be taken in order to appeal decisions by the ICO and we also consider whether the companies that have failed to appeal and are now facing class actions made the right decision when they elected not to appeal.

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The CCPA Is in Effect and It Is Not Too Late to Get Started in 2020

Happy New Year! At long last, the California Consumer Privacy Act of 2018 (“CCPA”) went into effect yesterday, January 1, 2020. For those who have not yet heard, the CCPA establishes a comprehensive legal framework to govern the collection and use of personal information, both online and offline, and provides unprecedented privacy rights to California consumers, in effect becoming the de facto national standard for U.S. privacy law. The law introduces new legal risks and considerations for companies that collect information from California consumers, due to the law’s expansive scope, broad definition of personal information, increased disclosure obligations, enhanced consumer rights, potential for statutory fines and, in the event of a security incident, the potential for consumer class action litigation. READ MORE

A Survival Guide for GDPR Enforcement Actions from a German Perspective – How to Assess and Mitigate Fines for GDPR Violations

Since the first enforcement actions have been initiated, some with significant fines, many companies may find themselves somewhat at a loss as they may not fully know how to assess the risks involved and how to react should an enforcement action be initiated against them. Here we will give a high-level overview on risks and strategies in enforcement actions. READ MORE

California Governor Signs CCPA and Breach Notification Statute Amendments into Law

With the January 1, 2020 effective date of the California Consumer Privacy Act (the “CCPA”) rapidly approaching, all eyes have been on the California legislature’s consideration of a robust suite of amendments that would clarify ambiguities and address discrepancies underlying the prominent privacy statute. On October 11, 2019, six CCPA amendments were signed into law by the California Governor, as well as an amendment to the state’s breach notification statute. The rest of the CCPA amendments have either failed or will have to wait until next year for further consideration.

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Up for Interpretation: Proposed CCPA AG Regulations Open for Public Comment

On October 10, 2019, the California Attorney General added to the complexity of the California Consumer Privacy Act of 2018 (“CCPA”) by releasing long-awaited proposed regulations that provide guidance on various elements of the CCPA. The text of the proposed regulations is available here and the California Attorney General has made other documents and information relating to the proposed regulations available here. The comment period for the proposed regulations will close on December 6, 2019. Interested parties may review and provide written comments addressing the proposed regulations prior to that date or attend one of four scheduled public hearings on the proposed regulations to be held on December 2-5, 2019. READ MORE

Seventh Circuit Rejects FTC Authority to Obtain Equitable Money Relief Under Section 13(b) of the FTC Act

On August 21, 2019, the U.S. Court of Appeals for the Seventh Circuit held in FTC v. Credit Bureau Center, LLC, 2019 WL 3940917 (7th Cir. 2019) that the Federal Trade Commission (“FTC”) lacks authority to obtain monetary relief under Section 13(b) of the FTC Act. The FTC has relied on Section 13(b) to seek money relief in consumer protection enforcement actions, including privacy and cybersecurity matters, and had, prior to the Credit Bureau decision, suggested an intent to do so more frequently in the future. READ MORE

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