Data Breach Warning of Lawsuits

Last Monday an article by Jay Singleton published in the Connecticut Law Tribune cast some very ominous warnings for every medical or financial organization across the country. Trial lawyers are setting their sights on you for the data you have and how well you protect it.

With medical organizations pressing to put patient records into electronic format, all it takes is one lost laptop or a single data security lapse and you become to focus of a number of law firms. One loss of personal information and any of the people whose information you held could take legal action against you. According to the federal Department of Health and Human Services, the personal medical data for more than 11 million people may have been exposed during the past two years.

Financial institutions already have similar problems. Attorney Michael A. Stratton, of New Haven’s Stratton Faxon, is involved in two class actions filed in New Haven seeking damages from banks accused of mishandling personal information of customers. One case involves the Bank of New York Mellon, which lost data tapes containing personal information for about 4.5 million people, including 500,000 customers of People’s United Bank of Bridgeport.

While these lawsuits are in their early stages and there is no clear examples of loss or damages to be presented. There are plaintiffs lawyers who concede that valuation of these cases is still a big unknown. This does not mean that they will not search until they find it.

The health-related privacy cases as class actions is still untested territory, attorneys believe new law will be made in the next few years. That means attorneys and the courts will be addressing these issues in the not too distant future. It would be best if your company or organization is not the test case for this type of new action.