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Recognizing the Real Harm Caused by Data Breaches

Posted in Attorney Blogs,News on June 18, 2015

Naturally, individuals that sign up for this service exchange highly personal information that is meant to be kept private. Now, thanks to a breach of security, it’s no longer private-it is out there for everyone to see.

Andrew Auernheimer, a controversial computer hacker, used Twitter to publicly identify AdultFriendFinder’s customers which included a police academy commander, an FAA employee, a California state tax worker, and a naval intelligence officer. Several others who were identified reside in small towns, where the impact of the exposure was magnified. There are millions of others who remain unnamed, but whose information is publicly available online.

Not too long ago, these customers may not have had a remedy for this kind of breach of their privacy. However, courts are beginning to recognize data breaches as the extremely damaging incidents we all know them to be–and holding companies potentially liable for failing to adequately protect a client’s information.

Case in point: during the holiday season in 2013, Target suffered a data breach. Over 110 million customers’ debit and credit card information was stolen. More than 100 named plaintiffs brought suit, alleging, among other complaints, that Target failed to:

  1. Adequately maintain computer systems and data-security systems;
  2. Provide timely and accurate notice of the breach;
  3. Stop accepting payments when it knew or should have known there was a breach; and
  4. Disclose to its customers that it did not have adequate safeguards in its computer system to protect the sensitive and financial data of its customers.

Target filed a motion to dismiss the complaint, which was denied. Shortly after the denial of the motion to dismiss, the case settled for $10 million.

If this case had been brought 20 years ago, the results would most likely have been different. However, courts are beginning to realize that the damage data breaches can wreak on customers and are beginning to hold companies responsible if they do not take adequate measures to protect the information.

Hopefully, this trend will continue and will provide some remedy to those whose privacy was violated and who suffered real harm because of the AdultFriendFinder’s data breach.