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Consulting firm agrees to $4.95 million settlement to resolve class data breach claims

Privacy/Cyber Risk & Data Security Courts Data Breach Class Action Settlement

Privacy, Cyber Risk & Data Security

On February 16, the U.S. District Court for the Southern District of New York granted final approval of a $4.95 million class action settlement, resolving allegations that a consulting firm failed to use reasonable data security measures when designing web-based portals for state employment agencies in Illinois, Colorado, and Ohio. According to the class’s supplemental brief in support of their motion for final approval, the allegedly poorly designed websites were subject to a data breach that resulted in unauthorized access to unemployment seekers’ personally identifiable information. The parties agreed to a nationwide settlement class of 237,675 individuals in Illinois, Colorado, and Ohio. These individuals were notified by their state employment agencies that certain personal information submitted when applying for pandemic-related unemployment claims may have been inadvertently exposed in a data breach. Under the terms of the settlement, the defendant agreed to establish a $4.95 million settlement fund to compensate eligible claimants, and will pay more than $1.6 million in attorneys’ fees and costs, as well as class member service awards.