breach notification

As many data breach litigation cases have demonstrated over recent years, the question of a plaintiff’s standing can be quite important to the outcome of each case.  While the Supreme Court has addressed standing issues in several cases with potential applicability in the data breach litigation context, most recently in Spokeo, Inc. v. Robins and Clapper v. Amnesty International, the Court has not yet addressed head-on the question of standing requirements for plaintiffs in data breach litigation.  More recently, a cert petition in another data breach standing case (In re Zappos.com), discussed below, has been distributed for conference this Friday, December 7, 2018.  As the Court considers whether to grant cert and address this issue, this post provides an overview of the circuit split on standing in data breach litigation cases and efforts to convince the Court to revisit the issue and provide more precise guidance. 
Continue Reading Standing Issues in Data Breach Litigation: An Overview

Canada’s new data breach law, The Personal Information Protection and Electronic Documents Act (“PIPEDA”), took effect on November 1. Official guidance released by the country’s Privacy Commissioner explains a few of the law’s key provisions that will affect organizations, specifically, breach reporting and notification obligations, their triggers, and record retention.

Reporting & Notification Obligations

Under the new law, an organization must report and notify individuals of a data breach involving personal information under its control if it reasonably determines the breach creates a “real risk of significant harm” to an individual, regardless of the number of individuals affected. (The guidance states a covered breach that affects only one individual would nonetheless require reporting and notification.) Importantly, the organization that controls the data is required to report and notify individuals of the breach—the guidance clarifies that even when an organization has transferred data to a third-party processor, the organization remains ultimately responsible for reporting and notification. The guidance encourages organizations to mitigate their risk in the event their third-party processor faces a breach by entering sufficient contractual arrangements.

Notification to individuals must be given “as soon as feasible” after the organization has determined a covered breach has occurred. The guidance states the notification must be conspicuous, understandable, and given directly to the individual in most circumstances. It must include enough information to communicate the significance of the breach and allow the those affected to take any steps possible to reduce their risk of harm. The regulations further specify the information a notification must include. In certain circumstances, organizations are also required to notify governmental institutions or organizations of a covered breach; for example, an organization may be required to notify law enforcement if it believes it may be able to reduce the risk of harm.Continue Reading Canadian Privacy Commissioner Releases Official Guidance as Data Breach Law Takes Effect

This spring has seen significant legislative activity with regards to state data breach notification laws, ranging from new laws in Alabama and South Dakota to amendments to existing laws in Oregon, Arizona, and elsewhere.  Continuing this trend, three states recently passed legislation to amend their existing data breach notification laws.  Legislation recently passed in Colorado will require notification of affected individuals and the state Attorney General within 30 days, while recent amendments to Louisiana’s data breach notification law will expand the scope of personally identifiable information (“PII”) covered by the law.  In addition, Vermont recently passed legislation that will create specific data breach notification requirements for “data brokers.”  This post examines each state’s amendments in greater detail below.

Colorado

Through the passage of H.B. 1128, which takes effect on September 1, 2018, Colorado has broadened the definition of PII under its existing data breach notification law, in addition to requiring notification of the state Attorney General and imposing strict notification timelines.  Once the new provisions enter into force, covered entities will be required to notify affected individuals within 30 days of the determination that a breach has occurred.  Colorado joins Florida as the only states that have imposed a 30-day notification deadline for notice to individuals, although Colorado’s law, unlike Florida’s, will not include a provision that allows for an extension of this deadline under certain limited conditions.  In addition, Colorado’s amendments will require notification of the state Attorney General if a covered entity believes that more than 500 state residents have been affected by a breach.  As with individual notifications, the notification to the state Attorney General must be provided within 30 days  after the date of determination of a breach.Continue Reading Colorado, Louisiana, and Vermont Add to Recent Trend of Changes to State Data Breach Notification Laws

On April 24, 2018, Senators Amy Klobuchar (D-MN) and John Kennedy (R-LA) introduced the Social Media Privacy and Consumer Rights Act of 2018.  The bill aims to protect consumers’ online data by increasing the transparency of data collection and tracking practices, and requiring companies to notify consumers of a privacy violation within 72 hours.

“Our bill gives consumers more control over their private data, requires user agreements to be written in plain English and requires companies to notify users of privacy violations,” Senator Kennedy explained. “These are just simple steps that online platforms should have implemented in the first place.”

Other features of the legislation include providing consumers a right of access to see what information about them has been collected and used, allowing consumers to opt out of data collection and tracking, and requiring online platforms to have a privacy program in place.  Senator Klobuchar explained that “[c]onsumers should have the right to control their personal data and that means allowing them to opt out of having their data collected and tracked and alerting them within 72 hours when a privacy violation occurs and their personal information may be compromised.” 
Continue Reading Senators Klobuchar and Kennedy Introduce Privacy Legislation

Earlier this month, the UK Government published a consultation on plans to implement the EU Directive on security of network and information systems (the “NIS Directive”, otherwise known as the Cybersecurity Directive).  The consultation includes a proposal to fine firms that fail to implement “appropriate and proportionate security measures” up to EUR 20 million or 4% of global turnover (whichever is greater).

We summarise the UK Government’s plans below, including which organisations may be in scope — for example, in the energy, transport and other sectors, as well as online marketplaces, online search engines, and cloud computing service providers — and the proposed security and incident reporting obligations.

Organisations that are interested in responding to the consultation have until September 30, 2017 to do so.  The UK Government will issue a formal response within 10 weeks of this closing date, and publish further security guidance later this year and next.  A further consultation on incident reporting for digital service providers will be run later this year; the Government invites organisations that are interested in taking part to provide appropriate contact details.
Continue Reading UK Government Proposes Cybersecurity Law with Serious Fines

Delaware Gov. John Carney has signed into law a bill that will impose more stringent obligations for notifying affected Delaware residents in the event of a data breach, in addition to establishing requirements for Delaware businesses to maintain “reasonable” data security practices.  In addition to expanding the types of information that would require notification of affected individuals if breached, the amendments will also require an entity to provide credit monitoring services if the breach involves Social Security numbers.  Once the bill enters into force, entities will also have to notify the Delaware Attorney General if a breach affects more than 500 Delaware residents.  The amendments will enter into force on approximately April 14, 2018.
Continue Reading Delaware Amends Data Breach Notification Law to Require Credit Monitoring, Attorney General Notification

Last week, New Mexico and Tennessee both passed legislation updating each state’s requirements for notifying residents following a data breach.  New Mexico’s new law, H.B. 15, makes it the 48th U.S. state to enact a state data breach notification law, leaving Alabama and South Dakota as the only states that have not enacted similar laws.  Tennessee’s bill, S.B. 547, amended its Identity Theft Deterrence Act of 1999 to exempt certain encrypted data from triggering notification requirements.
Continue Reading New Mexico Becomes 48th State with Data Breach Notification Law; Tennessee Restores Exemption for Encrypted Data

New York Attorney General Eric T. Schneiderman announced this week that there were a record number of data breach notices in New York in 2016, with nearly 1,300 reported data breaches exposing the personal records of 1.6 million New Yorkers.  These numbers represented a 60 percent year-over-year increase in the number of data breaches reported, and a threefold increase in the number of records exposed.

According to an analysis conducted by the Attorney General’s office, which builds on a 2014 report, most of the exposed records consisted of social security numbers and financial account information, and the leading causes of data security breaches in New York were hacking and inadvertent disclosures.  Schneiderman’s statement cautioned that these record numbers make it “all the more important for companies and citizens alike to take precaution when sharing and storing personal data” as “these breaches too often jeopardize the financial health of New Yorkers and cost the public and private sectors billions of dollars.”
Continue Reading NY Data Breaches Reached Record Levels in 2016

Last week, the Office of Management and Budget issued an updated breach response policy for federal agencies, replacing a policy last updated in 2007.  The policy, set forth in memorandum M-17-12, provides minimum standards for federal agencies in preparing for and responding to breaches of personally identifiable information (PII).  …
Continue Reading Updated OMB Breach Response Policy Includes Required Breach-Related Provisions for Federal Agency Contracts

On Tuesday, the FTC issued new guidance for businesses on responding to data breaches, along with an accompanying blog post and video.  The data breach response guidance follows the issuance of the FTC’s “Start with Security” data security guidance last year and builds upon recent FTC education and outreach initiatives on data security and cybersecurity issues.  The FTC’s data breach response guidance focuses on three main steps:  securing systems and data from further harm, addressing the vulnerabilities that led to the breach, and notifying the appropriate parties. 
Continue Reading FTC Issues Guidance for Responding to Data Breaches