In another favorable decision for companies, the Maine Supreme Court ruled on September 21, 2010 that consumers affected by a data breach could not claim damages from the company unless they suffered uncompensated financial losses or some other tangible injury. 

The Maine Supreme Court addressed the following:

In the absence of physical harm or economic loss or identity

theft, do time and effort alone, spent in a reasonable effort to

avoid or remediate reasonably foreseeable harm, constitute a

cognizable injury for which damages may be recovered under

Maine law of negligence and/or implied contract?

The Court ruled they do not. Additionally, the Court went on to state that "[t]he tort of negligence does not compensate individuals for the typical annoyances or inconveniences that are a part of everyday life….An individual’s time alone, is not legally protected from the negligence of others."

The underlying suits were filed following a breach, and fraudulent use, which resulted when card holder data of nearly 4.2 million people was stolen. The lawsuits alleged the company was negligent in protecting card holder data and failed to notify of the breach in a timely fashion.  The above holding was issued when the District Court Judge who heard the underlying case, agreed to let the state Supreme Court decide whether the plaintiffs could sue the company for the time and effort put into avoiding or mitigating harm from fraudulent charges on their cards.

Two other cases are similarly instructive. In 2003 the Minnesota Supreme Court found that an invasion of privacy cause of action requires that the dissemination resulted in “publicity” of private facts. Because the disclosure was internal to other employees, and not to the public at large, the Court held the dissemination was insufficient publicity to support an invasion of privacy claim against the employer. Further, in Guin v. Brazos Higher Educ. Serv. Corp. Inc., 2006 U.S.Dist. LEXIS 4846(D. Minn. Feb. 2, 2006), the District Court dismissed plaintiff’s negligence claim holding that the threat of future harm not yet realized will not support a claim for negligence which requires a showing of an injury.

Companies and employers must be on notice of these decisions when faced with individual lawsuits following data breaches. 

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Photo of Jason C. Gavejian Jason C. Gavejian

Jason C. Gavejian is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. and co-leader of the firm’s Privacy, Data and Cybersecurity practice group. Jason is also a Certified Information Privacy Professional (CIPP/US) with the International Association of Privacy…

Jason C. Gavejian is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. and co-leader of the firm’s Privacy, Data and Cybersecurity practice group. Jason is also a Certified Information Privacy Professional (CIPP/US) with the International Association of Privacy Professionals.

As a Certified Information Privacy Professional (CIPP/US), Jason focuses on the matrix of laws governing privacy, security, and management of data. Jason is co-editor of, and a regular contributor to, the firm’s Workplace Privacy, Data Management & Security Report blog.

Jason’s work in the area of privacy and data security includes counseling international, national, and regional companies on the vast array of privacy and security mandates, preventive measures, policies, procedures, and best practices. This includes, but is not limited to, the privacy and security requirements under state, federal, and international law (e.g., HIPAA/HITECH, GDPR, California Consumer Privacy Act (CCPA), FTC Act, ECPA, SCA, GLBA etc.). Jason helps companies in all industries to assess information risk and security as part of the development and implementation of comprehensive data security safeguards including written information security programs (WISP). Additionally, Jason assists companies in analyzing issues related to: electronic communications, social media, electronic signatures (ESIGN/UETA), monitoring and recording (GPS, video, audio, etc.), biometrics, and bring your own device (BYOD) and company owned personally enabled device (COPE) programs, including policies and procedures to address same. He regularly advises clients on compliance issues under the Telephone Consumer Protection Act (TCPA) and has represented clients in suits, including class actions, brought in various jurisdictions throughout the country under the TCPA.

Jason represents companies with respect to inquiries from the HHS/OCR, state attorneys general, and other agencies alleging wrongful disclosure of personal/protected information. He negotiates vendor agreements and other data privacy and security agreements, including business associate agreements. His work in the area of privacy and data security includes counseling and coaching clients through the process of investigating and responding to breaches of the personally identifiable information (PII) or protected health information (PHI) they maintain about consumers, customers, employees, patients, and others, while also assisting clients in implementing policies, practices, and procedures to prevent future data incidents.

Jason represents management exclusively in all aspects of employment litigation, including restrictive covenants, class-actions, harassment, retaliation, discrimination, and wage and hour claims in both federal and state courts. He regularly appears before administrative agencies, including the Equal Employment Opportunity Commission (EEOC), the Office for Civil Rights (OCR), the New Jersey Division of Civil Rights, and the New Jersey Department of Labor. Jason’s practice also focuses on advising/counseling employers regarding daily workplace issues.

Jason’s litigation experience, coupled with his privacy practice, provides him with a unique view of many workplace issues and the impact privacy, data security, and social media may play in actual or threatened lawsuits.

Jason regularly provides training to both executives and employees and regularly speaks on current privacy, data security, monitoring, recording, BYOD/COPE, biometrics (BIPA), social media, TCPA, and information management issues. His views on these topics have been discussed in multiple publications, including the Washington Post, Chicago Tribune, San Francisco Chronicle (SFGATE), National Law Review, Bloomberg BNA, Inc.com, @Law Magazine, Risk and Insurance Magazine, LXBN TV, Business Insurance Magazine, and HR.BLR.com.

Jason is the co-leader of Jackson Lewis’ Hispanic Attorney resource group, a group committed to increasing the firm’s visibility among Hispanic-American and other minority attorneys, as well as mentoring the firm’s attorneys to assist in their training and development. He also previously served on the National Leadership Committee of the Hispanic National Bar Association (HNBA) and regularly volunteers his time for pro bono matters.

Prior to joining Jackson Lewis, Jason served as a judicial law clerk for the Honorable Richard J. Donohue on the Superior Court of New Jersey, Bergen County.