Judge Says Don't Sweat The Data Leaks

from the thanks-for-looking-out dept

A judge in Minnesota ruled last month that Wells Fargo wasn't negligent in a recent data leak when a contractors' laptop was stolen -- not because they took adequate precautions to prevent the leak, but rather because the thieves never used any of the data. The bank was sued by two customers, whose claim for damages was rejected because they couldn't show they'd actually been harmed, which on one level, makes sense. But to say that Wells Fargo or its contractor wasn't negligent in storing customer data unencrypted on a laptop is a stretch. A court ruled in a similar case earlier in the year (also in US District Court in Minnesota) that a company wasn't liable because it had taken "reasonable" precautions to protect data, which, in the case, included storing unencrypted information on a laptop. So with that standard, and this new ruling that says companies are negligent not when unencrypted information is stolen, but only if it's used, do legal consequences give companies much motivation to actually bother to protect customer information in a meaningful way? Of course not. So basically, if customer information gets stolen by a thief that just wants to hawk the laptop, companies have nothing to worry about -- but why should their negligence be defined by the actions of the thief, and not on the actual theft itself?
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  1. identicon
    Metal Guy, 15 Apr 2006 @ 7:58pm

    Re: Hmmm

    Actually, there is a building code in place in most localities that states that any pedestrian walkway where there is more than a 30-inch drop-off requires a guardrail that is 42" high and won't allow a 4-inch sphere to pass through it at any point. They also specify that these rails must resist a 200-pound point load and a 50-pound-per-foot distributed load. Although failure to adhere to these codes is not a criminal act, it does not absolve a fabricator of these rails from responsibility in the event of an accident. So you don't go to jail when a kid falls through a hole in the rail, but you DO lose the lawsuit for $XX million.

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