Edward Sharkey's blog

Could a Business be Liable for a Data Breach Even if There is No Harm?

Posted by Edward Sharkey on Tue, 05/14/2013 - 04:00

When a company stores its customers’ personally identifiable information (“PII”) in an electronic database, the company has a duty to guard that information with reasonable care. PII can be a name, address, phone number, Social Security number, or other information by which an individual may be identified or contacted. Businesses have been sued when the inadvertent dissemination of customers’ PII has led to identity theft.

In any lawsuit, the plaintiff must prove causation and damages. That is, the data breach must be proven to be the cause of some harm suffered by the plaintiff. Courts have dismissed data breach lawsuits when the plaintiff can allege no more than that identity theft occurred shortly after the data breach. A new case in the 11th Circuit, however, has shown plaintiffs a novel way to pursue data breach lawsuits, even if they cannot prove damages.

Crowdfunding Law Update

Posted by Edward Sharkey on Mon, 04/22/2013 - 04:00

Last week marked the one-year anniversary of the passage of the JOBS Act, which contained provisions intended to legalize equity crowdfunding in the United States. The celebration was blemished by the fact that the SEC’s rules are more than three months late, and until they are issued, equity crowdfunding remains illegal.

Wednesday morning, in perhaps the biggest development in equity crowdfunding since the JOBS Act, Mary Jo White was sworn in as the newest Chairwoman of the SEC. This is good news for crowdfunding advocates, small businesses, and startups.

Is My Logo Too Similar to My Competitor's?

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

For the past 30 years, Ralph Lauren and the U.S. Polo Association (“USPA”) have been fighting over the logo of a polo player. In 1984, USPA won a judgment giving it the right to sell merchandise with a “double horsemen” logo. The logo is similar, but not identical, to Ralph Lauren’s trademarked polo player logo. In that case, the judge ruled that the word “polo” was generic enough for use by competitors, as long as USPA did not emphasize it in its marketing or design. He also ruled that USPA’s logo was distinct enough from Ralph Lauren’s that it would not cause confusion as to the source of the product or service offered.

Without Litigation Hold, A Business Can Be Sanctioned Even Without Loss of Data

Posted by Edward Sharkey on Sun, 03/24/2013 - 04:00

The importance of implementing a proper litigation hold when a business has notice that a lawsuit is likely was highlighted again in a recent decision (pages 17-18) issued by a Federal District Court in New Jersey. In the case, the judge awarded expenses to the plaintiff because the defendant failed to properly implement a litigation hold once the lawsuit started. The defendant's errors included failing to disable the automatic delete function on its email server and not preserving copies of its backup tapes.

Crowdfunding for Startups: SEC Rules Hopefully Coming Soon

Posted by Edward Sharkey on Fri, 03/08/2013 - 05:00

When Congress legalized equity crowdfunding for startups and small businesses in the 2012 JOBS Act, it intended to give small businesses access to new investors and a viable substitute for debt financing. In addition to the excitement the law created in small businesses and startups, it sparked a lot of public commentary.

What Do I Do First When My Business is Sued? New Case Illustrates Importance of Litigation Hold

Posted by Edward Sharkey on Tue, 02/12/2013 - 05:00

A new case from New Jersey reminds businesses of the importance of acting promptly to identify and preserve relevant information when the prospect of a lawsuit arises. In the case, the judge granted a business's motion for sanctions against a New Jersey county for failing to properly preserve electronic evidence once it had notice of potential litigation. What did the county do wrong?

Business Crowdfunding Law Delayed by Inaction at the SEC

Posted by Edward Sharkey on Wed, 02/06/2013 - 05:00

We’ve been following developments concerning the new law allowing businesses to raise capital through crowdfunding. The law would permit companies to sell equity to any person (through a regulated intermediary that will serve a role similar to a stock brokerage) without having to register with the SEC. If this sounds familiar, you may be aware of Kickstarter, IndieGoGo, or Razoo: three popular crowdfunding websites that have helped get business ideas and creative ventures off the ground. These sites do not, however, allow creators to exchange equity for cash. “Equity crowdfunding” remains illegal as long as the SEC’s rulemaking is incomplete. Now, the implementation of the new law remains delayed.

New Case Protects Businesses’ Copyrights in Employee-Generated Content - Part II

Posted by Edward Sharkey on Mon, 01/28/2013 - 05:00

In November, we discussed a new case issued by the 9th Circuit Court of Appeals, in which the court addressed a copyright dispute between a company and a former employee. In addition to reminding us that employers can claim content generated by employees “in the scope of employment”, the case also resolved issues concerning the copyright of derivative works. That is, whether work derived from earlier content is worthy of new copyright protection.

“Derivative works” are discussed in the Section 103 of the Copyright Act, and are given copyright protection subject to some restrictions. The 9th Circuit’s opinion sheds some light on when derivative works are eligible for a new copyright, distinct from the original work.

May I Terminate An Employee Suspected of FMLA Cheating?

Posted by Edward Sharkey on Mon, 01/07/2013 - 05:00

Businesses continue to seek an efficient way to manage the effects of the Family and Medical Leave Act (the “FMLA”). The FMLA entitles employees to take leave to care for a sick family member. Sometimes, unscrupulous employees abuse this benefit. Employers are often uncertain about how to deal with an employee suspected of lying about the need to take leave. A new case decided by the Seventh Circuit Court of Appeals gives some guidance.

Employers Take Note: EEOC Announces New Priorities

Posted by Edward Sharkey on Mon, 12/03/2012 - 06:41

The Equal Employment Opportunity Commission (“EEOC”) calls itself “the nation’s…chief promoter of equal employment opportunity.” It is a law enforcement body with statutory authority to enforce anti-discrimination laws, including the Civil Rights Act of 1964 and the Americans with Disabilities Act. With a few exceptions, the anti-discrimination laws enforced by the EEOC generally apply to businesses with 15 or more employees. The EEOC periodically gives guidance on where it expects to direct its focus going forward. The guidance is helpful to businesses in managing their affairs.

Call Today (301) 657-8184

 Google+  View Edward Sharkey's profile on LinkedIn