Target has proposed to pay $10 million to settle a class-action lawsuit over its massive 2013 data breach, according to court documents filed in the U.S. District Court in Minnesota on Wednesday.
The settlement, if approved by a judge, would allow individual shoppers to receive up to $10,000 in damages if they can prove they endured losses stemming from Target’s data breach. Up to 40 million shoppers had their credit card data stolen during the breach, while up to 70 million had personal information such as addresses and phone numbers stolen.
The settlement also states that Target will create a new position, a chief information security officer, who will be responsible for protecting customer data. Target promises in the court documents that it will implement a program to train Target employees on security practices and will periodically review its safeguards to make sure they are sufficient to protect consumers. Read more in Washington Post (external link).
Why should people get that money?
Just because had to cancel and change credit cards doesn’t title you to money
Lexington:
The article is clear that consumers need to prove they suffered damages as a result of the data breech in order to receive any payment. The amount thy receive will also depend on the amount of damage they suffer up to 10k. It’s not a simple 10k handout.
Also, it’s important to note that class actions serve a very important societal function. It’s a protection for consumers that companies who are reckless with consumers’ information to pay hefty punitive sums. It incentivizes companies to spend the extra money needed to protect customers. It also sends a message to other companies that they need to be proactive in protecting consumers’ information.
10 million dollars to Target is barely a slap on the wrist. According to bloomberg.com, Target 2014 revenues totaled 72.6 BILLION dollars. Contrast the settlement total with the financial peril they caused to a myriad of unassuming customers by failing to employ sufficient security precautions until it was too late.
Don’t blame Target. In today’s world all your info is out there. Even the Pentagon cannot protect its data. One bad employee can within minutes copy and release data. One mistake in a line of code can leave a back door open to hackers. One USB stick can do it all. It happens all the time.
The only real solution is to make all the data worthless to criminals, where no one can open an account by just knowing your social security number and date of birth. Credit card numbers will be created on the fly. Using such ideas will negate a large part of this issue.