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December 1, 2015

01 December 2015

FTC’s Action Against LabMD Dismissed Due to Inadequate Evidence of Harm; FTC Appeals

A recent ALJ Initial Decision may prove significant in data breach litigation and provide further aid to companies battling class actions with claims of future injury through identity theft.  On November 13, 2015, the administrative law judge hearing the FTC’s action against medical testing laboratory LabMD dismissed the FTC’s case in its entirety.  See In re LabMD, Inc., F.T.C. ALJ, No. 9357 (Nov. 13, 2015). The action had its genesis in an investigation of LabMD’s security practices.  The investigation began after a report that information from LabMD may have been disclosed on a file-sharing website.  The FTC asserted that LabMD had failed to properly protect sensitive data and that information gleaned from its records was being used for identity theft purposes.

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