Data Privacy Awareness

Post Spokeo: Two recent cases split on the nature of data breach injuries

In Joan Longenecker-Wells v. Benecard Services, Inc., plaintiffs were employees who learned that their personal information, including date of birth, social security number, addresses, etc. which resulted in fraudulently filed tax returns. The Third Circuit dismissed the Plaintiff’s claims, stating that their negligence claims were barred by the economic loss doctrine. The Third Circuit explains:

The District Court held that because Plaintiffs’ negligence claim sounds only in economic loss resulting from the fraudulent tax returns filed with their information, the economic loss doctrine bars their claim. We agree.

Food for thought. Can we say that a plaintiff, who experiences this grave injustice of losing the benefit of a 5 figure tax return is only sustaining economic loss? The real harm and the risk of ongoing identity fraud is more than economically and emotionally harmful. We must focus on the deeper rooted issue that lies at the heart of data intrusion cases. The fundamental right to privacy that has deep roots in our history now extends to our digital privacy.

In contrast, we have Taylor v. Spherion Staffing LLC, et al. No. 3:15-cv-2299 (N.D. Ohio 2015), Ernst v. Dish Network, LLC, et al. No. 1:12-cv-8794 (S.D.N.Y May 27, 2016); Hillson et al. v. Kelly Services, No. 2:15-cv-10803 (E.D. Mich. June 8, 2016). These cases settled and involved allegations of statutory violations. Keep in mind that Spokeo left open the possibility that a statutory violation may involve a real risk of harm to satisfy the concreteness requirement. Thus, settlement may have presented a more attractive alternative than extended litigation about the sufficiency of alleged harms.

Understanding the value of Privacy is NOT “Privacy Paranoia”

We should care about Privacy because it is a fundamental aspect of living a free, autonomous existence.

We should care about Privacy because it is a fundamental aspect of living a free, autonomous existence.

Why do people not care about Privacy? Some will offhandedly claim, “I have nothing to hide.” Others will say that big data and government surveillance should not concern those who are law abiding and innocent of wrongdoing. But the problem with this response is that it reveals a lack of understanding regarding the value of privacy. Privacy is not a mere shield or wall to hide certain details about us from others. The concept is not reducible to single acts of intrusion or violation of one’s personal sphere. To think about Privacy in terms of someone peering into your window to watch you with your family is to focus on only one tiny strand of tapestry or one grain of sand in a beach.

Think of the value of Privacy this way: If you drank one glass of lead-laden water from Flint, would you see a quick path to cancer or any other potentially deadly disease? Probably not. But the problem for those in Flint was that they drank water contaminated with lead for years. The cumulative effect, the acts taken in the aggregate were what caused so many in Flint to suffer irreversible health problems.

This is the same way the Privacy violations harm each of us and our society as a whole. The information collection, aggregation, insecurity, increased accessibility and decisional inferences/interference (“decisional interference” was coined by Prof. Daniel Solove).

While nebulous, Privacy is important because it affords individuals a basic amount of autonomy and control over facts and details that make each unique. In the aggregate, “big data” seems harmless. But as we have seen, there are many ways to hack and identify personally identifiable information (PII). When the PII and/or valuable data sets of individuals get in the wrong hands, one loses control over their finances and their digital existence. One of my data breach clients suffered and continues to see fraudsters obtain lines of credit, obtain a Washington State driver’s license, and so on. Folks: This is NOT Privacy Paranoia. It is a well informed fact that we need to care about how our PII is disclosed and safeguarded.

Most people do not realize how their data is getting sold in myriad forms either legally or illegally. I will talk about this more in future posts. That private data has value in virtually every imaginable industry. If it matters to others, it certainly should matter to you. At the very least, to value your Privacy is to value control over the information that is accessible about you. If you don’t care about having that minimal amount of control, then feel free to broadcast your SSN along with all of your family’s SSNs and dates of birth.

What’s up with the careless attitude towards inadequate data security?

An increasingly common and relatively easy way for hackers to access sensitive data is through “phishing,” where unwitting recipients of email or texts (SMS phishing or “smishing”) trust the sender with the sought after information. According to Verizon’s new 2016 Data Breach Investigations Report, about 90% of security incidents stem from some form of phishing.  Verizon reports that phishing continues to trend upward and is found in the most opportunistic attacks as well as “sophisticated nation-state tomfoolery.” But president of the Olympia School District chuckles (yes, that’s right, chuckles) at its recent breach resulting from phishing because, according to what he told MyNorthwest reporter, Sara Lerner:

“It happens…it’s an opportunity to have that conversation and move forward with it. You could call it a teachable moment if you want to,” he said, with a chuckle. 

That kind of cavalier attitude is exactly the problem that we have with so many school districts and government agencies. One cannot be careless, when it comes to sensitive data, whether it is at a school district or at the Health Care Authority/Apple Health Data Breach, where an employee’s mishandling and HCA’s insufficient privacy protocols allowed the medical records of 91,000 individuals to get sent to an unauthorized recipient 

As we continue our class action litigation regarding the Anthem data breach as well as the Amerigroup Washington data breach, I learn more about how stolen protected health information (PHI) is marketed on the dark net. To those who want to toss caution to the wind, feel free to do so with your own data. Just not everyone else’s.

BTW: If you were one of those who received a data breach notification from HCA or the Olympia School District, please contact me at Catherine@Stritmatter.com or 206.448.1777. I would like to learn your perspective and story, as well as share the details of how we’re trying to hold these organizations accountable to prevent future data breaches.

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