In the past few years, many high-profile lawsuits have been filed concerning data breaches at national companies. How high profile? Companies including Target, Home Depot and Michaels have all been accused of failing to protect consumer information. But it’s not just retail companies that face claims. Universities, financial institutions, insurance companies and health care providers have also faced lawsuits linked to data breaches.
When information including Social Security numbers, date of birth and medical information is taken, thieves can file false tax returns and take out a mortgage in the victim’s name, putting the victim at risk of having his or her credit rating ruined. Even when the breach is uncovered in time, victims must spend their own time setting things right, notifying the proper people and organizations, and canceling cards.
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Perhaps the most egregious breach is that of SanrioTown.com, an online community for people who love Hello Kitty. According to The Guardian (12/21/15), the breach allegedly exposed members’ first and last names, birth dates, genders, countries, e-mail addresses, some passwords, and password questions and answers. Sanrio has not commented on the alleged leak.
Companies who fail to adequately protect consumer, employee or client information can face lawsuits to recover damages sustained as a result of negligence. They may also face fines or other sanctions from regulators and lawsuits from shareholders.
Recently, data breach lawsuits have been settled, including a proposed $10 million settlement in the Target data breach lawsuit.