by Robert M. McKenna, Scott Lindlaw
Washington Legal Foundation
February 12, 2014
One day after retailer Target confirmed hackers had penetrated its computer systems, the company offered customers free credit-monitoring services and identity-theft insurance. Target anticipated an avalanche of data-privacy lawsuits claiming damages stemming from the cost of individuals buying such services. Plaintiffs’ attorneys have been energized by a recent federal appellate court finding that a consumer who responds to a data breach by purchasing identity-theft insurance has been “harmed.” By providing these services free of charge, Target could deprive plaintiffs of one claim of “harm.” The Target litigations will unfold for years to come, with outcomes we cannot foresee. What is clear is that plaintiffs’ attorneys are already using the case to test creative new theories for establishing harm and obtaining standing. Target will ask courts to hold the line by maintaining their historic resistance to most such theories.