It seems that some large companies don't quite get it – they must tighten their cybersecurity defenses or face a continual series of class actions for damages. It's no matter that a company's facilities are invaded by a criminal group of hackers. What really matters in a legal sense is that the company negligently did not bother to take advantage of available technology to protect the victims whose information was compromised. That's the predicament now faced by Sony Pictures Entertainment, based in California. It may be facing a slew of class-action suits just ahead.
The specter of new class-action claims comes less than six months after Sony settled a class action lawsuit brought on behalf of millions of its Sony Play Station customers. In that case, Sony left its customers' data bases unguarded, and up to 77 million customers had their personal information stolen from Sony's control. This time around, the damage has been inflicted mostly on Sony's employees, whose personal information was stolen by hackers.
According to the attorney who sued Sony on the Play Station case, Sony violated the basic industry standards for data encryption of employees' information with respect to this recent debacle. Reportedly, most of the basic information on employees was held in unencrypted and even non-password-protected files. Critics of Sony's lapse in this matter say that the company should know better – it clearly had access to all of the technical knowledge and resources to keep the information safe.
Thus, the main basis of any upcoming class actions will be the company's alleged negligence in failing to provide basic protection to its employees' information. Since the stolen information contained such critical information as social security numbers, the company will not likely get far in arguing that it had no duty to protect the employees' information. Since the Sony Pictures Entertainment lot is located in Culver City, it's likely that at least some of the anticipated class-action suits will be filed in California.
Source: buzzfeed.com, "Sony Could Face Class Action Lawsuit For Data Breach", Matthew Zeitlin, Dec. 3, 2014
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