By Perry Cooper
A data breach without any identity theft or other actual harm isn’t enough to create standing to sue in federal court, insurer CareFirst Inc. told the U.S. Supreme Court Oct. 30.
CareFirst asked the court to review an August ruling by the U.S. Court of Appeals for the District of Columbia Circuit that revived class claims stemming from a 2015 data breach that compromised information of 1.1 million consumers ( CareFirst, Inc. v. Attias , U.S., no. not available, review sought 10/30/17 ).
Federal courts continue to struggle with how to interpret the U.S. Supreme Court’s holding in Spokeo Inc. v. Robins that plaintiffs must allege a harm that is “actual or imminent” rather than speculative. The issue is particularly challenging for the courts in data breach cases where hackers may not yet have used stolen data.
The D.C. Circuit joined the Seventh Circuit, which said in Remijas v. Neiman Marcus Grp. that data breaches create a substantial risk of identity theft because, presumably, the purpose of a hack is to eventually make fraudulent charges or assume the consumers’ identities.
But the Third, Fourth, and Eighth circuits have held that plaintiffs don’t have standing based on an increased risk of identity theft without an allegation of actual harm, CareFirst said in its petition to the high court.
“The D.C. Circuit’s approach reduces the substantial risk standard to one of plausibility, a far less stringent test than even the objectively reasonable likelihood standard that the court found inadequate in Clapper,” CareFirst said. It referred to Clapper v. Amnesty Int’l, where the Supreme Court held that claims based on future injures require that the injuries are imminent or that there is a substantial risk of that they will occur.
Matthew O. Gatewood in Washington, and Robert D. Owen and Francis X. Nolan IV in New York, all of Eversheds Sutherland LLP filed the petition on behalf of CareFirst.
To contact the reporter on this story: Perry Cooper in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Steven Patrick at email@example.com
Full text at http://src.bna.com/tPW.
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)