Please join Shipman & Goodwin attorneys Bill Roberts and Alfredo Fernández for this complimentary CLE webinar which will discuss the unique threats presented by personnel with legitimate access to controlled company information and how to proactively mitigate risks of data misuse. Topics to include:

  • Insiders vs. intruders vs. knuckleheads
  • Motivators, risk factors and indicators
  • Technical

Back in 2008, Illinois became the first state to pass legislation specifically protecting individuals’ biometric data. Following years of legal challenges, some of the major questions about the law are about to be resolved (hopefully). Two major legal challenges, one now at the Illinois Supreme Court and another with the Court of Appeals for the Ninth Circuit, seek to clarify the foundational issues that have been a battleground for privacy litigation — standing and injury. To understand the stakes, Illinois’ Biometric Information Privacy Act requires companies who obtain a person’s biometric information to: (1) obtain a written release prior to their information being stored and collected; (2) provide notice that their information is being stored and collected; (3) state how long the information will be stored and used; and (4) disclose the specific purpose for its storage and use. The law further provides individuals with a private right of action. However, in order to trigger that private right, an individual must be “aggrieved.”
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When a data breach occurs at a company, not only is customer data vulnerable but so is employee information. But what obligations do employers owe their employees?

This issue was recently decided in part, at least with respect to Pennsylvania employers, in Dittman v. UPMC, 43 WAP 2017, 2018 WL 6072199, at *14 (Pa. Nov. 21, 2018).  In Dittman, a group of employees sued their employer, the University of Pittsburg Medical Center, for failure to take reasonable care to protect their personal private information.  On appeal, the Supreme Court of Pennsylvania overturned the decision of the lower court and held that an employer owes a common law duty of care to its employees to use reasonable care to safeguard their sensitive data as stored on the employer’s internet-accessible computer system. Notably, the employees’ position was not that the employer engaged in any misfeasance, but nonfeasance for failure to prevent the harm from occurring. The Supreme Court found that the mere fact that third parties committed the wrongdoing – the data breach – did not negate the duty of the employer to safeguard the employees’ sensitive information that they were required to provide the employer as a condition of employment.

The Dittman case is certainly not the first time a group of employees sued an employer based upon a data breach of the employer’s computer system that resulted in the disclosure of the employees’ personally identifiable information. In Sackin v. TransPerfect Global, Inc., 278 F. Supp. 739 (S.D.N.Y. 2017), the employer moved to dismiss a class action filed by the employees, which motion was denied, in part. Among other things, the district court found that the complaint sufficiently stated a cause of action for breach of common law duty of care and that the employer violated its duty to take reasonable steps to protect the employees’ data. The court also found that a viable cause of action existed for breach of the implied contract between the employer and employees, but not for breach of the terms of the employment contract. With respect to the former, the conduct and course of dealing between the parties was deemed to rise to the level of an implied contract because, as a prerequisite of employment, the employees were required to provide the employer with certain sensitive data, and given how commonplace data and identity theft are in the current day and age, the court found an implied assent by the recipient to protect that data.
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Shipman & Goodwin attorney Daniel Schwartz will co-present on data privacy issues and the necessary steps employers must take to protect employee data, as part of the firm’s 2018 Labor and Employment Fall Seminar.

During the session, “If You Collect It, You Must Protect It: Dealing with Employee Data Privacy Issues,” Dan will discuss