In Seyfarth’s third installment of its 2014 Trade Secrets Webinar series, Seyfarth attorneys took a closer look at avoidance and mitigation techniques for data breaches, including where the class action plaintiff’s bar is going and what potential defenses and strategies companies can employ in such lawsuits.
As a conclusion to this well-received webinar, we compiled a list of key takeaway points, which are listed below.
- A strong security program requires layers. You can’t rely just on technical safeguards and the IT group. You also need people and processes to help catch the threats which get through the cracks that technology cannot plug. As part of that layering, it isn’t just about the prevention of threats, it is also about detection and early warning of threats. This will allow for the isolation of a threat which has made it through the “front door” before it gets into the safe in the bedroom.
- A company gets a greater return on investment by being prepared for a security breach. Training employees on handling personal information engages them in the process, and raises awareness to reduce the risk of an incident or that an incident will go unnoticed. Developing an incident response protocol and team with defined responsibilities allows a company to be more nimble and efficient when a potential incident occurs. And, as the study we referenced demonstrates, companies that already have an incident response plan in place spend 1/3 less on security incidents than those that do not have an incident response protocol.
- Increasingly courts are becoming more receptive to putative class claims alleging unlawful data breach in violation of statute or under the common law. Article III standing and lack of actual damages continue to be key defenses to such claims but courts are more receptive to creative claims based upon statutory language or contract interpretation. Companies should consider using arbitration agreements with class action waivers, as well as early dispositive motions to attempt to manage the risk of these dangerous suits.
Please join us for our next webinar on June 17, Trade Secret and Non-Compete Legislative Update