Edward Sharkey's blog

Creating a Policy to Protect Against Data Breach

Posted by Edward Sharkey on Tue, 01/14/2014 - 05:00

Back in May, we wrote about a data breach case and a decision by the 11th Circuit Court of Appeals. The Court allowed the case to proceed, even though the plaintiffs had no evidence that they suffered harm from the data breach. We speculated that it could signal a shift in the way courts are thinking about data breach lawsuits.

In that case, a laptop belonging to a health care provider was stolen from the provider’s office. The laptop contained customers’ personally identifiable information (“PII”), and the company was sued for the data breach. The court ruled that the plaintiffs, some of whom later became victims of identity theft, could proceed with a negligence claim against the business, despite the lack of evidence that the theft of the laptop, and the breach of PII that followed, caused the identity theft.

Prediction for the New Year - Target a "Target" of Major Data Breach Lawsuit

Posted by Edward Sharkey on Wed, 12/18/2013 - 05:00

Target has just been hit by a massive data breach. Evidently, the culprits installed software in machines customers use to swipe cards when paying for merchandise. They may have been collecting credit card data for weeks, beginning on Thanksgiving. It is likely millions of credit and debit cards. We do not yet know all of the details. We do know, however, what happens to a business in these shoes next . . .

Business's Failure to Preserve Evidence When Suit is Filed Brings Sanction

Posted by Edward Sharkey on Fri, 11/15/2013 - 05:00

Recently, another federal court emphasized the importance of issuing an effective "litigation hold" when a lawsuit is filed. This most recent case arose out of a dispute between a former employee and her employer, a supermarket chain. The employee, who was suing for wrongful termination, claimed that the business failed to preserve relevant evidence once it knew of the lawsuit.

SEC Issues Draft Rules for Equity Crowdfunding

Posted by Edward Sharkey on Tue, 10/29/2013 - 21:02

The Securities Exchange Commission finally issued the long-awaited rules to govern equity crowdfunding. Under the JOBS Act, the SEC was mandated to promulgate the rules – primarily meant to protect new and unsophisticated investors from fraud – by the end of 2012. For many cash-strapped small businesses, the phrase ‘better late than never’ has never been more apropos.

Crowdfunding experts and small business advocates had previously voiced concerns that the delay in the SEC’s rulemaking process was a bad omen, signaling a potential for over-regulation and the possible neutering of the JOBS Act’s titular goal: to “Jumpstart Our Business Startups.” We are happy to report that this does not appear to be the case.

May A Business Ask for Customers’ Zip Codes?

Posted by Edward Sharkey on Tue, 09/17/2013 - 04:00

If you shop at retail stores with any regularity, you’re probably familiar with the checkout clerk asking for your zip code when you make a credit card purchase. A recent ruling by the Massachusetts Supreme Court has called into question whether doing so is legal – at least in states with similar consumer protection statutes and when it is done for “marketing purposes” as opposed to verifying the card user’s identity.

Pending Case Illustrates Danger of Data Breach to Businesses

Posted by Edward Sharkey on Mon, 08/26/2013 - 04:00

Data breach, most often occasioned by computer hacking, is the acquisition of personally identifying information (“PII”) by unauthorized parties. It can lead to serious issues – notably, identify theft – for the people whose PII is stolen. We have addressed before in this space some of the legal problems businesses may face after falling victim to a data breach. We have also discussed a developing legal theory used by plaintiffs to pursue claims against businesses for data breach, even when a breach has not resulted in identify theft or actual damages. Another large-scale data breach has been in the news lately, and it illustrates just how problematic such a breach can be for a small business.

Minimum Wage is Sometimes Not Enough

Posted by Edward Sharkey on Wed, 08/07/2013 - 04:00

Capital Bikeshare, the tremendously popular bicycle sharing business that opened in the Washington, D.C. area less than three years ago, is being accused of underpaying its employees under federal law. This comes just a few weeks after the company set a new mark when its bikes were taken for over 11,000 trips on a single Saturday, and as it plans to expand its service into Montgomery County this year.

Does a Business Have to Pay Overtime if it Was Not Approved?

Posted by Edward Sharkey on Tue, 07/23/2013 - 04:00

Disputes about overtime pay are a significant portion of all lawsuits filed against businesses every year. In addition to disputes about what classes of employees are entitled to overtime pay, parties sometimes fight over whether overtime was authorized or approved. Employees who work extra want to be paid. But businesses that did not approve or know that an employee was doing extra work understandably are reluctant to pay. A recent case gives businesses some guidance on the issue.

Businesses Need Not Accommodate An Employee Who Cannot Perform "Essential Functions" of Their Job

Posted by Edward Sharkey on Thu, 06/06/2013 - 04:00

Businesses continue to struggle with issues relating to the Americans with Disabilities Act (the "ADA"). One very gray area is whether the parts of a job that a disabled employee cannot perform are "essential functions" of the job. If a disabled employee cannot perform the essential functions of a job, an employer does not have to retain or accommodate him.

In a recent case brought under the ADA, the 8th Circuit Court of Appeals reiterated one of the most important protections for employers under the act: in order to succeed on a discrimination claim under the ADA, an employee must prove, among other things, that she can perform the “essential functions” of the job.

The Government Says a Food Allergy May be a "Disability"

Posted by Edward Sharkey on Thu, 05/23/2013 - 04:00

Under some circumstances, food allergies may rise to the level of a disability for purposes of the Americans with Disabilities Act (the "ADA"). This was the holding in a recent case involving the U.S. Department of Justice and Lesley University, a private school with campuses in Boston and Cambridge, Massachusetts. The dispute came about after a group of students with Celiac disease (a disorder which can be triggered by the consumption of gluten) made a complaint to the DOJ in 2009.

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