Regulatory Enforcement and Litigation

The Federal Trade Commission (FTC) has entered into a settlement with a provider of management software for car dealerships that held personal information, including SSN’s and payroll information, in cleartext, holding its practices to be in violation of the FTC Act’s prohibition against unfair practices and GLBA’s Safeguards Rule, which requires financial institutions to develop,

How has GDPR enforcement played out in the past year?

The Dutch Data Protection Authority (Autoriteitpersoonsgegevens, or AP) recently published a report on its 2018 activities.

The report highlights the growth of GDPR enforcement actions:

  • 27,000 people contacted the AP by telephone about the Privacy Act (2017: 9,500).
  • AP received more than 11,000 complaints.
  • AP

Data-rich companies like Facebook have a unique opportunity to capitalize on the recent surge in regulatory scrutiny and turn it to their advantage.

Savvy tech companies are attuned to public opinion and won’t allow others to control the narrative. They are already taking steps to regain the upper hand in the privacy debate.

Facebook demonstrated

The European General Data Protection Regulation (GDPR) comes into force on May 25, 2018.  This gives companies only two months to prepare for and comply with the GDPR. Companies should be conducting data mapping to identify all cross-border transfers of personal data so that they can determine the best way to comply with the GDPR

Acting Federal Trade Commission (FTC) Chairman Maureen K. Ohlhausen made it clear that she expects the FTC’s enforcement role in protecting privacy and security to encompass automated and connected vehicles. In her opening remarks at a June 28, 2017 workshop hosted by the FTC and National Highway Traffic Safety Administration (NHTSA), she said the FTC

In one of the best examples we have ever seen that it pays to be HIPAA compliant (and can cost A LOT when you are not), the U.S. Department of Health and Human Services, Office for Civil Rights, issued the following press release about the above settlement. This is worth a quick read and some soul searching if your company has not been meeting its HIPAA requirements.
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The “new age” of internet and dispersed private data is not so new anymore but that doesn’t mean the law has caught up. A few years ago, plaintiffs’ cases naming defendants like Google, Apple, and Facebook were at an all-time high but now, plaintiffs firms aren’t interested anymore. According to a report in The Recorder, a San Francisco based legal newspaper, privacy lawsuits against these three digital behemoths have dropped from upwards of thirty cases in the Northern District of California i 2012 to less than five in 2015.
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The freedom from automated calls at random hours of the evening may seem like the true American dream these days as more and more companies rely on these calls to reach out and communicate with customers. Unfortunately, now that the Federal Communications Commission (“FCC”) voted to expand the Telephone Consumer Protection Act (“TCPA”) to include stringent yet vague restrictions on telemarketing robocalls, it may not be a dream for everyone.
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A recent District of Nevada ruling could cause issues for consumers in data breach class action cases moving forward. On June 1, 2015, the court ruled that a consumer class action against Zappos.com Inc. could not proceed because the class did not state “instances of actual identity theft or fraud.” The suit was brought as a result of a 2012 data breach where Zappos’ customers’ personal information was stolen, including names, passwords, addresses, and phone numbers. Even though the information was stolen, the court dismissed the case because the class could not prove that they had been materially harmed and had no other standing under Article III.
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As noted in Dittman et al. v. The University of Pittsburgh Medical Center, Case No. GD-14-003285, previously reported on here, Pennsylvania has firmly adopted the approach that the Risk of Harm is Not Enough in Data Breach Actions. Still, data breaches have become some of the most noteworthy headlines in recent news. An increase in litigation has brought with it efforts to shrink the case load through the Article III requirement of standing. This means that courts are finding that the plaintiffs have not sufficiently established a concrete injury in order to seek remedies from the court. One of the main issues with data breaches is that once the data has been extracted or accessed, it is not necessarily always true that tangible harm will follow. Due to that nature, the Third Circuit established that when it comes to data breach actions, simply the risk of future harm does not suffice to save the claim. The seminal case of Reilly v. Ceridian Corp. held that where no actual misuse is alleged, “allegations of hypothetical, future injury do not establish standing under Article III.” 664 F. 3d 38 at 41 (3rd Circuit 2011).
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