Privacy Advisor

Are data breach mitigation costs cognizable damages?

In late 2007, Hannaford Supermarkets suffered one of the nation’s largest credit and debit card breaches to date. Millions of card numbers were exposed and thousands of fraudulent charges were made. The thieves went beyond the common database attacks and installed ''sniffers'' that intercepted customers’ credit and debit card data in real time. Following the breach announcement, several civil cases were filed and consolidated into a class-action lawsuit adjudicated in the U.S. District Court for the District of Maine, where it was initially held that a showing of injury-in-fact was lacking for all plaintiffs except for customers who sought reimbursement for the unreimbursed fraudulent charges.

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