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Financial Services Law Insights and Observations

District Court grants preliminary approval of data breach class action

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

Courts

On October 3, the U.S. District Court for the Eastern District of Wisconsin granted preliminary approval of a data breach class action settlement. According to the plaintiff’s unopposed motion for preliminary approval, a ransomware attack on the company potentially allowed an unauthorized actor to access the personal information of approximately two million of the company’s patients, employees, employee beneficiaries, and other individuals from May 28, 2021 to June 4, 2021. The company announced the ransomware attack in a data breach notice sent to customers on June 24, 2021. The plaintiff filed her complaint alleging, among other things, that the company “failed to take adequate measures to protect her and other putative Class Members’ Personal Information and failed to disclose that [the company’s] systems were susceptible to a cyberattack.” After other plaintiffs filed suit, the plaintiffs moved to consolidate the actions and alleged several violations, including negligence and breach of implied contract. The settlement provides for a $3.7 million settlement fund. Each class member is eligible to submit a claim for two years of three-bureau credit monitoring and up to $1 million of insurance coverage for identity theft incidents. Additionally, class members can submit a claim for up to $10,000 in documented losses. The settlement also provides class members with lost time payment and cash fund payment options (in the alternative to all the foregoing settlement benefits).