Eye On Privacy

Timely Updates and Analysis on Privacy and Cybersecurity Issues

In a notable application of the European Court of Justice’s “Schrems II” decision, the data protection authority for the German state of Bavaria recently held that use by a German entity of US-based MailChimp (which use involved transferring personal information to the US) violated GDPR. As we previously wrote, the Schrems II decision turned on concerns around lack of sufficient safeguards under US law. The court cautioned, and the EDPB has since clarified further, that for standard contractual clauses to be used companies must determine whether the information will have the same level of protection under the laws…
Utah recently amended its breach notice law to provide certain defenses to companies who suffer a data breach.  It is now the second state, after Ohio, to include such provisions. Specifically, entities that create and reasonably comply with a written cybersecurity program may have an affirmative defense to litigation resulting after a data breach. For the safe harbor to apply, the written cybersecurity program must:…
Artificial intelligence continues to remain a focus in 2021, as we predicted at the start of the year. From the FTC, to the EU, to others, regulators of all kinds are paying attention to companies’ use of these tools. In the latest, five US federal agencies are seeking input on how financial institutions are using AI tools. Comments from stakeholders are due by June 1, 2021.…
As the first quarter of 2021 comes to a close, cyberattacks are only gaining momentum. As we reported last month, these attacks have become big business for threat actors, and companies are working hard to be prepared. Taking stock of potential risks – and risk management techniques – can be a useful exercise in this environment. For this, tools from change management can help. Change management, particular sustainable change management, teaches us not to jump head-first into action, but first to take stock of what actions will be most helpful.…
Utah’s governor recently signed into law SB 227, creating the Genetic Information Privacy Act (GIPA). The law, which is anticipated to go into effect in May, is aimed at protecting genetic data collected from direct-to-consumer genetic testing companies. Generally, the law creates requirements for (i) notice; (ii) consent for certain data uses; (iii) data security obligations; and (iv) access, deletion, and destruction rights.…
On March 15, 2021, the California Office of Administrative Law (“OAL”) approved additional regulations to the CCPA. These regulations were originally proposed at the end of 2020 (which we covered here).  The changes are effective immediately. The modifications largely focus on (1) changes impacting those companies that “sell” information, and (2) the verification process for rights requests made by authorized agents.…
The Illinois Biometric Information Privacy Act (BIPA) has spawned hundreds of class action lawsuits and a raft of unresolved issues.  A core issue from a litigation perspective—as well as for companies bracing for potential lawsuits—is one of “standing,” and in particular, what BIPA claims can be brought by plaintiffs in what venues.…
Virginia is now the second state, after California, to pass a comprehensive privacy law. The Consumer Data Protection Act (“CDPA”) will come into effect January 1, 2023 (the same time as the modification to California’s Consumer Privacy Act (“CCPA”), namely the California Privacy Rights Act). Although this new Virginia law has been compared by many to California’s current CCPA and the EU’s GDPR, there are some differences. Businesses will find most of the differences a relief, although the law does introduce a few new concepts.…
Cyberattacks have become big business from the standpoint of attackers.  Threat actors range well beyond cults of old, and now including sophisticated state actors, large businesses organized for the very purpose of cyber breach and theft, and complex threat networks that aggregate information formerly treated as innocuous.  This is a real risk for companies as we look forward to the remainder of 2021. At the same time, ransomware is changing the state of cyber insurance, with regulators across the globe entering the field to govern the conduct of attacked businesses in this climate. Regulations cover terms of ransom payments and…
Many states require insurance providers that do business in their states to complete annual certifications of compliance.  As examples, the deadline in New Hampshire is coming up on March 1.  The deadline in Alabama, Connecticut, Delaware, Louisiana, Michigan, Mississippi, Ohio, and South Carolina was February 15.  (The deadline under new laws in Michigan and Virginia will be February 15 as well, starting in 2022 and 2023, respectively.)  The deadline in New York is April 15. …
The FTC recently settled with Flo Health, Inc., a popular fertility-tracking app, based on promises made about how health data would be shared.  In its complaint, the FTC alleged that while Flo promised to keep users’ health data private and only use it to provide the app’s services to users, in fact, health information of over 100 million users was being shared with popular third party companies. Namely, third parties who provided marketing and analytics services to the app.…
Artificial intelligence continues to be a focus and concern for businesses, regulators, and lawmakers alike. As we recently wrote, there was much activity and focus on artificial intelligence and the impact on privacy laws. In addition to legal developments, there have been advancements in AI business technologies by major multinational technology firms, something focused on this post in our sister Intellectual Property Law Blog. There has been an arms race underway by the world’s leading economies to win the estimated $13 Trillion of GDP this field stands to award the winner.  In a recent podcast episode, partners Siraj…
Many have been watching facial recognition law developments closely, and saw that Portland became the first US city to regulate the use of such technology by private entities operating “places of public accommodation” within the city. Of particular concern for the Portland city council was the use potentially discriminatory use of these technologies, and its impact on “children, Black, Indigenous and People of Color, people with disabilities, immigrants, refugees, and other marginalized communities and local businesses.”…
Will HHS’ approach for imposing penalties in the aftermath of a data breach become a little clearer in 2021? This is a distinct possibility in the wake of a Fifth Circuit decision vacating penalties against MD Anderson Cancer Center. The hospital suffered three data breaches, leading HHS to impose over $4 million in civil penalties. That fine was reversed recently by the Fifth Circuit as arbitrary, capricious, and contrary to law.…
A class action lawsuit filed against PayPal in connection with a breach it suffered in 2017 was dismissed recently because the plaintiffs did not adequately allege PayPal’s intent to deceive investors.  The litigation began after PayPal’s acquired TIO Networks Corporation, a smaller payment processor and platform.  Post-acquisition, PayPal announced that it had discovered “security vulnerabilities” in TIO’s operations and it thus suspended TIO’s operations.  At that point, TIO had not yet been integrated into PayPal’s platform.  PayPal confirmed that it was investigating TIO’s security measures with the help of outside assistance, and that PayPal customers’ data remained secure.  PayPal further…