Data Breach Notification

A $300,640 settlement announced yesterday by the Office for Civil Rights (OCR) provides important reminders about HIPAA Privacy Rule and data privacy practices generally: robust data disposal practices are critical and “protected health information” (PHI) is not limited to diagnosis or particularly sensitive information.

The OCR’s settlement involved a New England dermatology practice that reported

Organizations attacked with ransomware have a bevy of decisions to make, very quickly! One of those decisions is whether to pay the ransom. Earlier this year, I had the honor of contributing to a two-part series, entitled Ransomware: To pay or not to pay? (Part 1 and Part 2). Joined by Danielle Gardiner

States continue to tinker with their breach notification laws. The latest modification to the Indiana statute relates to the timing of notification. On March 18, 2022, Indiana Governor Eric Holcomb, signed HB 1351 which tightens the rules for providing timely notice to individuals affected by a data breach.

Prior to the change, the relevant section

On May 20, 2022, the Federal Trade Commission’s Team CTO and the Division of Privacy and Identity Protection published a blog post entitled, “Security Beyond Prevention: The Importance of Effective Breach Disclosures.” In the post, the FTC takes the position that in some cases there may be a de facto data breach notification

The FTC recently settled its enforcement action involving data privacy and security allegations against an online seller of customized merchandise. In addition to agreeing to pay $500,000, the online merchant consented to multiyear compliance, recordkeeping, and FTC reporting requirements. The essence of the FTC’s seven count Complaint is that the merchant failed to properly disclose

Included within the Consolidated Appropriations Act, 2022, signed by President Joe Biden on March 15, the Cyber Incident Reporting for Critical Infrastructure Act of 2022 (Act) creates new data breach reporting requirements. This new mandate furthers the federal government’s efforts to improve the nation’s cybersecurity, spurred at least in part by the Colonial Pipeline cyberattack that snarled the flow of gas on the east coast for days and the SolarWinds attack.  It’s likely the threat of increasing cyberattacks from Russia in connection with its war effort in Ukraine also was front of mind for Congress and the President when enacting this law.

In short, the Act requires certain entities in the critical infrastructure sector to report to the Department of Homeland Security (DHS):

  1. a covered cyber incident not later than 72 hours after the covered entity reasonably believes the incident occurred, and
  2. any ransom payment within 24 hours of making the payment as a result of a ransomware attack (even if the ransomware attack is not a covered cyber incident to be reported in i. above)

Supplemental reporting also is required if substantial new or different information becomes available and until the covered entity notifies DHS that the incident has concluded and has been fully mitigated and resolved. Additionally, covered entities must preserve information relevant to covered cyber incidents and ransom payments according to rules to be issued by the Director of the Cybersecurity and Infrastructure Security Agency (Director).

The effective date of these requirements, along with the time, manner, and form of the reports, among other items, will be set forth in rules issued by the Director. The Director has 24 months to issue a notice of proposed rulemaking, and 18 months after that to issue a final rule.

Some definitions are helpful.

  • Covered entities. The Act covers entities in a critical infrastructure sector, as defined in Presidential Policy Directive 21, that meet the definition to be established by the Director. Examples of these sectors include critical manufacturing, energy, financial services, food and agriculture, healthcare, information technology, and transportation. In further defining covered entities, the Director will consider factors such as the consequences to national and economic security that could result from compromising an entity, whether the entity is a target of malicious cyber actors, and whether access to such an entity could enable disruption of critical infrastructure.
  • Covered cyber incidents. Reporting under the Act will be required for “covered cyber incidents.” Borrowing in part from Section 2209(a)(4) of Title XXII of the Homeland Security Act of 2002, a cyber incident under the Act generally means an occurrence that jeopardizes, without lawful authority, the integrity, confidentiality, or availability of information on an information system, or an information system. To be covered under the Act, the cyber incident must be a “substantial cyber incident” experienced by a covered entity as further defined by the Director.
  • Information systems. An information system means a “discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information” which includes industrial control systems, such as supervisory control and data acquisition systems, distributed control systems, and programmable logic controllers.
  • Ransom payment. A ransom payment is the transmission of any money or other property or asset, including virtual currency, or any portion thereof, which has at any time been delivered as ransom in connection with a ransomware attack.

A report of a covered cyber incident will need to include:
Continue Reading Cyber Incident, Ransom Payment Reporting to DHS Mandatory for Critical Infrastructure Entities

On February 9, the Securities and Exchange Commission (“SEC”) voted to propose rule 206(4)-9 under the Advisers Act and 38a-2 under the Investment Company Act (collectively, “Proposed Rule”). In general, the Proposed Rule would require all advisers and funds to adopt and implement cybersecurity policies and procedures containing several elements. While acknowledging spending on cybersecurity

The California Consumer Privacy Act (CCPA), considered one of the most expansive U.S. privacy laws to date, went into effect on January 1, 2020. The CCPA placed significant limitations on the collection and sale of a consumer’s personal information and provides consumers new and expansive rights with respect to their personal information.

Less than one

Efforts to secure systems and data from a cyberattack often focus on measures such as multifactor authentication (MFA), endpoint monitoring solutions, antivirus protections, and role-based access management controls, and for good reason. But there is a basic principle of data protection that when applied across an organization can significantly reduce the impact of a data