The U.S. Court of Appeals for the Fourth Circuit has added to the growing circuit split on standing in data breach cases in Beck v. McDonald, No. 15-1395 (Feb. 6, 2017). The circuit split now divides at least six federal courts of appeal regarding what data-breach victims must show to establish an “injury-in-fact” under Article III. The Fourth Circuit held that merely having your personal data stolen — and the alleged corresponding increased risk of future theft—is insufficient to satisfy Article III’s injury-in-fact requirement. (more…)
Cybersecurity compliance is becoming increasingly complicated with multiple regulators across the globe weighing in on your legal requirements to manage cyber risk. If you have wondered how others are approaching their compliance strategy, you are not alone.
You are invited to participate in a brief survey regarding your business’s approach to cybersecurity legal requirements. Specifically, the purpose of this survey is to learn how businesses like yours are responding to cybersecurity legal requirements under the European Union’s General Data Protection Regulation (GDPR) and Network and Information Security Directive (NIS Directive). In particular, we are interested in whether and if so, how businesses in the U.S. and the EU and elsewhere are applying the U.S. National Institute of Standards and Technology Framework for Improving Critical Infrastructure Cybersecurity to comply with these EU cybersecurity requirements. Understanding which standards business are applying in order to comply with these requirements could be helpful in encouraging consistency of cybersecurity frameworks in the U.S., the EU and other regions.
Please use the link provided below to access the survey which will take very few minutes to complete. We plan to publish the results in approximately six weeks. Please note that no individuals or specific businesses will be identified in any published results without their express consent.
CLICK HERE to begin the survey.
Thank you for your participation.
The National Association of Insurance Commissioners (NAIC) has created a new task force to monitor technology, data collection and Cybersecurity developments in the insurance industry. The Innovation and Technology (EX) Task Force (IT Task Force) was formed on March 9, 2017 and reports directly to the NAIC’s Executive Committee. The IT Task Force will appoint and oversee the work of the following NAIC groups: the Big Data Working Group, the Cybersecurity Working Group and the Speed-to-Market Working Group. According to the NAIC’s March 9, 2017 press release, the IT Task Force’s purpose is to help insurance regulators stay informed about technology-related developments, products and services in the insurance industry, including start-up companies, and to ensure they meet consumer expectations and ensure consumer protections. The press release notes that annual investment in insurance technology (InsurTech) has increased to more than $2.5 Billion and continues to grow.
*The authors are not licensed to practice law in Australia, and this information is intended for educational purposes only.
Australia has passed data breach notification legislation requiring certain companies with annual revenue over AU $3 million ($2.3 million) to notify the Australian Information Commissioner and affected individuals in the event of a qualifying data breach.
The Privacy Amendment (Notifiable Data Breaches) Bill 2016 (“the Bill”), which the Australian Senate passed on February 13th, amends the Privacy Act of 1988 (Privacy Act) to require that qualifying companies provide notification if there is “unauthorized access to, unauthorized disclosure of, or loss of, personal information by an entity,” and “the access, disclosure or loss is likely to result in serious harm to any of the individuals to whom the information relates.” According to the Office of the Australian Information Commissioner, examples of personal information include names, signatures, addresses, telephone numbers, dates of birth, medical records and “commentary or opinion” about individuals.
On February 16, 2017, the New York State Department of Financial Services (the “NYDFS”) issued its final regulations setting forth minimum requirements for NYDFS-regulated entities to address cybersecurity risk (“Final Regulations”). The NYDFS issued the Final Regulations after considering feedback and criticism received during two comment periods — one following the NYDFS’s initial publication of the proposed regulation (on September 13, 2016) and a second comment period after the NY DFS published a revised version of the regulation (on December 28, 2016.)
The Final Regulations will be effective as of March 1, 2017, with a transitional period of 180 days from that date for Covered Entities to comply with the Final Regulations, except for certain enumerated provisions for which longer compliance periods are specified. The annual certification of compliance (covering the prior calendar year) will be required beginning on February 15, 2018.
*This article first appeared in Bloomberg BNA Corporate Law & Accountability Report on February 23, 2017
On Jan. 12, 2017, the National Association of Corporate Directors (NACD) released its new “NACD Director’s Handbook on Cyber-Risk Oversight.” The NACD has suggested that directors can use this Cyber-Risk Oversight Handbook as a resource to “[l]earn foundational principles for board-level cyber-risk oversight” and gain insight into issues including how to:
- “allocate cyber-risk oversight responsibilities at the board level”;
- address “legal implications and considerations related to cybersecurity”;
- “set expectations with management about the organization’s cybersecurity processes”;
- “improve the dialogue between directors and management on cyber issues”; and,
- “improve and enhance boardroom practices.”
The Third Circuit recently overturned a district court’s ruling on In re Horizon Healthcare Services Inc. Data Breach Litigation and gave new life to a putative class action over a data breach. No. 15-2309 (Jan. 20, 2017). The Third Circuit panel held that allegations of unauthorized disclosure of personal information in violation of the Fair Credit Reporting Act (“FCRA”) constituted a de facto injury sufficient to establish Article III standing. Plaintiffs did not allege identity theft, any other misuse of the compromised data, or even any mitigation costs.
The potential liability from a material cyber-attack is wide-ranging. Accordingly, companies that experience network intrusions, system disruptions or unauthorized access to information databases must be prepared for a variety of potential consequences, each attended by its own costs…[read more]
2016 was a year of seismic changes in the global data protection and privacy landscape. Here, we look back at the top ten events and issues that shaped 2016, and are poised to shape the year ahead as well.
Year In Review
1. GDPR Adoption
On April 14, the European Parliament voted to adopt the long-awaited EU General Data Protection Regulation (GDPR), formally completing adoption of the GDPR. The GDPR was published in the Official Journal of the EU on May 25, 2016, giving companies and Member States until the May 25, 2018 effective date to implement the Regulation fully. In the wake of its adoption, businesses should have planning under way for implementation of the significantly expanded Regulation by evaluating whether they are subject to the expanded jurisdiction, and if so, completing an internal gap analysis of current data protection practices as compared with the new requirements and rights under the Regulation. Some of the key aspects to consider include data breach response planning under the new 72-hour notice requirement, reviewing existing data protection notices and consents for the more robust obligations, identifying current profiling activities and existing data protection and retention policies and procedures, ensuring privacy impact assessments are carried out where required, and evaluating whether there is an obligation to appoint a data protection officer. Despite the time until the effective date, the extensive preparation necessary to comply presents a challenge as companies around the world refocus resources to develop compliance plans.
2. Political Cyber Warfare
There is a new front in geopolitical battles. (more…)
On December 28, 2016, former President Obama issued Executive Order 13757, Taking Additional Steps to Address the National Emergency with Respect to Significant Malicious Cyber-Enabled Activities (E.O. 13757). E.O. 13757 amends an earlier Executive Order 13694 (E.O. 13694) of April 1, 2015, under which the President declared a “national emergency” to deal with the “unusual and extraordinary threat” to U.S. national security, foreign policy and the economy posed by malicious cyber-enabled activities conducted by persons outside the United States in relation to the November 2016 election. Through the December 2016 amendment, President Obama took “additional steps” to deal with such malicious cyber activities in view of their increasing use “to undermine democratic processes or institutions.”