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Julian Noses
Julian Noses

Buy Japanese Playstation Network Card

In the wake of the recently publicized databreach involving Sony's PlayStation and Online Entertainment networks, Congressappears ready to accelerate its efforts to enact legislation to implementregulations intended to prevent future breaches and provide a framework forenforcement in the event of a breach. The data breaches at Sony, which occurred on two separate occasions (atthe end of April and then again at the beginning of May), involved more than100 million accounts. The data that was leaked included information aboutPlayStation subscribers such as names, addresses, emails, passwords, usernames,birthdays, phone numbers and purchase histories. Sony is not the first, and unfortunatelywill likely not be the last, to be subject to such attacks. To date, the largest data breaches include upto 130 million credit card numbers stolen from Heartland Payment System in2009, up to 100 million accounts from retailer TJX in 2005 and 2006, and morethan 4.2 million credit and debit card numbers from the grocery chain Hannaford Bros. in 2008. Recently, at e-mail marketing firm Epsilon, there was asignificant data breach which affected about 50 of its business customers. And just this week it was revealed that asoftware flaw may have enabled third party applications operating withinFacebook to leak user account information. These incidents have renewedconcerns on Capitol Hill about how companies are responding to data breaches,especially in connection with notifying customers that their information mayhave leaked. Both Sony and Epsilon sentwritten responses to questions posed by a House subcommittee on their handlingof the breaches. Lawmakers appear torecognize that, although security measures may be in place, they are not alwaysfully implemented. House Energy and Commerce Committee members have questionedwhether U.S. businesses are taking the necessary steps to protect their data.According to Pablo Martinez, a deputy special agent in charge of the CriminalInvestigative Division at the U.S. Secret Service, in nearly all data breaches,the subject company had not taken reasonable precautions. A 2010 report found that 96% of breaches were,in fact, avoidable through simple or intermediate controls". In determining how to begin drafting acomprehensive and effective bill to regulate data breaches, several lawmakerssaid they planned to use the Data Accountability and Trust Act (2009) (DATAAct), as their starting point. Although introduced and passed by the House, theDATA Act was put to a vote in the Senate. If passed, the Act would haverequired organizations holding personal data to maintain security policies andto notify affected consumers after a data breach. It addressed the followingthree major concerns: information security requirements for personalinformation in general; information security requirements for personalinformation for 'information brokers'; and breach notice obligations. Althoughthe majority of states have enacted data breach laws, the DATA Act proposed anallowance for civil penalties of up to $11,000 per violation (up to $5 million)and each failure to send the required notification to an affected individualwould be treated, under the Act, as a separate violation. The risk of suchconsiderable penalties set forth in the Act would surely encourage compliance.On the other hand, there seemed to appear to be certain clauses within the DATAAct that could have led to even less breach reporting. With regard to breachnotice obligations, the bill required that potential victims of identity theftbe notified whenever their electronically stored personal information wasexposed. Had it been passed, the law would preempt all state laws (not juststate laws that are less stringent or contrary to the Act) and would be thefirst of its kind. All competing state law standards would therefore beeliminated, ultimately leading to less forum shopping. Furthermore, thestandard ("risk of harm") set forth in the DATA Act falls on thehigher end of the spectrum as compared to the standards set forth in some statelaws which would most likely lead to less frivolous lawsuits. A major concernwith the DATA Act was that it could only be implemented by the FTC. This wasproblematic as there are numerous companies and organizations that the FTC doesnot have jurisdiction over including banks, common carries and nonprofits. Inorder to be effective and worthwhile, the new bill will have to be drafted sothat it is not only enforceable by the FTC but by other governmental entitiesas well. Other apprehension stemmed from the fact that the bill provided thatbreaches would not have to be reported if the organization in questiondetermined that "there is no reasonable risk of identity theft, fraud, orother unlawful conduct". The bill also granted an exemption if thebreached information was encrypted or protected by any other technologies that,according to the FTC, renders data unreadable. As expected, lawsuits over theJapanese electronics giant's breach have started to come out of the woodworks.The first suit came a day after Sony acknowledged the breach. The complaint,filed in the Northern District Court of California, alleges that Sony failed totake "reasonable care to protect, encrypt and secure the private andsensitive data of its users" which prevented PlayStation Network usersfrom being able to "to make an informed decision as to whether to changecredit card numbers, close the exposed accounts, check their credit reports, ortake other mitigating actions". Thesuit seeks monetary compensation and free credit card monitoring. A second suit, which claims damages in excess of $1 billion (Canadian dollars), was filedby a Toronto-based law firm on behalf of a 21-year-old plaintiff and names SonyJapan, Sony USA, Sony Canada and other Sony entities as defendants. Theaftermath of these recent incidents may prove to be a useful lesson and mayexpedite the development of better security technology and practices in theprivate sector and perhaps even force Congress and the FTC to finally pass abill that will afford sufficient protection to consumers' personal data. We will continue to monitor the ongoingdevelopments in privacy and security legislation and its potential impact onour clients.

buy japanese playstation network card



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