On April 16, 2018, the Department of Homeland Security (DHS), the Federal Bureau of Investigation (FBI), and the United Kingdom’s National Cyber Security Centre issued a joint Technical Alert (TA), alerting the worldwide cyber exploitation of network infrastructure devices by Russian state-sponsored cyber actors. The TA explains primary targets to be government and private-sector organizations, critical infrastructure providers, and the Internet service providers (ISPs) supporting these sectors. The affected systems include: Generic Routing Encapsulation (GRE) Enabled Devices; Cisco Smart [...] Read more
The Securities and Exchange Commission (SEC) issued a press release announcing its unanimous approval of a statement by SEC Chairman Jay Clayton and interpretive guidance (the “2018 Guidance”) to assist public companies in preparing disclosures about cybersecurity risks and incidents. This is the first interpretive guidance published by the full Commission on the topic of cybersecurity for public companies, and it may foreshadow increased SEC action to protect investors from the potential negative effects of increasingly common large-scale data breaches. The 2018 Guidance formalizes and expands [...] Read more
“To Harmonize or Not To Harmonize: That Is the Question.” With the the GDPR fast approaching on May 25, 2018, European Member States are getting ready with the implementation of national legislation. Although the GDPR is a regulation, and directly applicable in all Member States, it has left room for country-specific legislation in several different regards (such as the processing of employee data or individual rights restrictions). Most Member States still only have draft legislation at this point, but the expectation (or at least intention) is that each country will have adopted legislation [...] Read more
By Jay Repko
A California district court recently dismissed—for the second time—consumer claims that technology giant Lenovo Inc. violated New York’s Deceptive Acts and Practices Statute by selling laptops with preinstalled VisualDiscovery software that allegedly invades users’ privacy and exposes users to security breaches. In reaching this decision, Judge Haywood S. Gilliam, Jr. concluded that dismissal was warranted for two reasons: (i) the plaintiffs lacked standing and (ii) the plaintiffs failed to adequately allege actual damages.
By its very terms, New York’s Deceptive [...] Read more
On December 5, 2017, the National Institute of Standards and Technology (NIST) released a revised draft of its proposed updates to its Framework for Improving Critical Infrastructure Cybersecurity. The revised draft includes a new section on communicating with stakeholders about cybersescurity requirements, addresses stakeholder concerns regarding cybersecurity supply chain risk management and measuring cybersecurity risks and benefits, and addresses six new topics, including the Cyber-Attack Lifecycle. NIST has updated both the Framework and its accompanying Roadmap.
The revised Framework includes [...] Read more
On November 30, 2017, a group of U.S. senators re-introduced a bill, known as the Data Security and Breach Notification Act, which seeks to impose criminal liability of up to five years of jail time on any corporate executive convicted of “intentionally and willfully” concealing a data breach.
The bill also proposes that the Federal Trade Commission (FTC) establish standard, nationwide security protocols for businesses to follow. The bill would also require companies to report data breaches to consumers or users within 30 days unless a U.S. federal law enforcement or intelligence agency [...] Read more
Virginia amended the state’s data breach notification law, effective July 1, 2017, to expand notification requirements for employers and payroll service providers to data breaches that involve “unauthorized access and acquisition of unencrypted and unredacted computerized data containing a [Virginia] taxpayer’s identification number in combination with the income tax withheld for that taxpayer. . . .”[1]
The expanded notification obligation is subject to the same likelihood of harm threshold that applies in the original law. Notification is required only when the employer or payroll [...] Read more
SEC Chairman Jay Clayton issued a public statement on Cybersecurity (the “Clayton Statement”) last week, disclosing a 2016 attack on the SEC’s database of corporate filings. The intrusion exploited a vulnerability in the test filing component of the EDGAR system, a document repository for disclosures from public companies and issuers, through which the intruder was able to gain access to nonpublic (and potentially sensitive) corporate information. Though the intrusion was detected in 2016, Clayton stated that the agency learned only in August 2017 that the incident, “may have provided [...] Read more
The Federal Trade Commission recently announced that it had settled charges against three companies alleged to have falsely claimed participation in Privacy Shield. Privacy Shield supports EU – U.S. transfers of personal data by helping U.S. companies demonstrate compliance with European Union data transfer rules. Companies participating in the program commit to meet specific program requirements designed to protect and limit use of personal data. These requirements include notice, choice, controls on onward transfers of data, independent recourse, and data security. Privacy Shield also requires [...] Read more
The United States Court of Appeals for the Eighth Circuit recently affirmed the district court’s dismissal of a putative class action brought by customers of the brokerage firm Scottrade in the wake of an alleged data breach impacting Scottrade in 2013. The named plaintiffs had asserted several contract-based claims against Scottrade, alleging that Scottrade had violated its contractual obligations to take adequate steps to safeguard the personal identifying information (“PII”) of its customers.
The Eighth Circuit first considered whether the plaintiffs had adequately alleged standing. [...] Read more
