threatens data security.
Despite the large number of data breach actions filed, plaintiffs are rarely granted class certification. In 2023, certification was only granted in 14% of cases. 1. Overview Data breach class actions have emerged as one of the fastest growing areas in the complex litigation space. After every major (and even not-so-major report) of a breach, companies can expect negative publicity followed by one or more class action lawsuits. In recent years, blue-chip companies such as Microsoft, Wattpad, Meta/Facebook, Estee Lauder, Whisper and Advanced Info Service endured data breach class action litigation following significant data breach events affecting hundreds of millions of employee and consumer records.
In 2023, there was a notable increase in data breach class actions. Data breach class actions filed within the first half of 2023 totaled 246, roughly equivalent to the total number of cases for the entire year of 2022. The monthly average of data breach class actions for 2023 stood at 44.5 until the end of August, marking a significant rise from the 2022 average of 20.6. This surge in data breach class actions in 2023 can be traced back to several contributing factors. One of the primary catalysts for this increase is the MOVEit data breach that took place this past year, involving file transfer software. Furthermore, there has been a marked increase in the sophistication of cybercriminal activities, leading to more frequent and severe data breaches. Based on our analysis of the 2023 data breach class action landscape, there is a significant uptick of ransomware attacks, where criminals are demanding a payment in exchange for not publishing data that they were able to obtain. But even if a company chooses to pay off a ransom, there is still a real worry that paying off a hacker does not guarantee that they will delete the data. Many believe that these payments will only encourage the attacks to continue. As a result, we expect to see more large-scale data breaches impacting companies across all industries, as the shift to remote working, cloud-based storage, and the rise in sophisticated cybercriminals threatens data security. This is turn will lead to more data breach class action lawsuit filings. While data breach actions pursued a decade ago faced little prospect of success, recent developments in the law and subsequent jurisprudence are providing momentum for the plaintiffs’ class action bar. Plaintiffs can more readily show standing and successfully plead duty, causation, and damages. A fundamental question in most data breach class actions is whether the plaintiff can show that he or she has standing to assert claims. While it is well-settled that individuals who have experienced direct economic injury from a
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Duane Morris Data Breach Class Action Review – 2024
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