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Anthem To Pay $115 Million In The Largest Data Breach Settlement Ever (cnet.com)
An anonymous reader quotes CNET:
Anthem, the largest health insurance company in the U.S., has agreed to settle a class action lawsuit over a 2015 data breach for a record $115 million, according to lawyers for the plaintiffs. The settlement still has to be approved by US District Court Judge Lucy Koh, who is scheduled to hear the case on August 17 in San Jose, California. And Anthem, which didn't immediately respond to a request for confirmation and comment, isn't admitting any admitting any wrongdoing, according to a statement it made to CyberScoop acknowledging the settlement.
But if approved, it would be the largest data breach settlement in history, according to the plaintiffs' lawyers, who announced the agreement Friday. The funds would be used to provide victims of the data breach at least two years of credit monitoring and to reimburse customers for breach-related expenses. The settlement would also guarantee a certain level of funding for "information security to implement or maintain numerous specific changes to its data security systems, including encryption of certain information and archiving sensitive data with strict access controls," the plaintiff attorneys said.
The breach compromised data for 80 million people, including their social security numbers, birthdays, street addresses (and email addresses) as well as income data. The $115 million settlement averages out to $1.43 for every person who was affected.
But if approved, it would be the largest data breach settlement in history, according to the plaintiffs' lawyers, who announced the agreement Friday. The funds would be used to provide victims of the data breach at least two years of credit monitoring and to reimburse customers for breach-related expenses. The settlement would also guarantee a certain level of funding for "information security to implement or maintain numerous specific changes to its data security systems, including encryption of certain information and archiving sensitive data with strict access controls," the plaintiff attorneys said.
The breach compromised data for 80 million people, including their social security numbers, birthdays, street addresses (and email addresses) as well as income data. The $115 million settlement averages out to $1.43 for every person who was affected.
So a pirated music file is worth tens of thousands of dollars, but a persons confidential medical history is worth $1.43
I'm actually surprised by this. Do a Google search for "cost of data breach" ... first hit is an IBM report. Take with a grain of salt, but, they claim it should be $141 per record on average.
So, looks like Anthem got a ~99% discount somehow - it should have cost $11.2 billion.
Reading the settlement agreement provides the following disbursement
As further described in this Agreement, the Settlement Fund shall be used by the Settlement Administrator to pay for:
(a) all reasonable Administrative Expenses;
(b) the Taxes described in Sections 3;
(c) Service Payments award by the Court, as described in Section 11;
(d) attorneys’ fees and costs approved by the Court, as described in Section 12;
(e) Credit Services as described in Section 4;
(f) Alternative Compensation as described in Section 5;
(g)Out-of-Pocket Costs as described in Section 6.
So the fund also covers taxes and administrative expenses, such as putting up a website where class members can go to register to get their money.
The fine is 0.23% of their market value, and has someone else pointed out it is tax deductible. Additionally it is not a single payment, so it will be spread out over two or more years.
This will have zero impact on the economics of the company, which means it will have zero deterrent effect on Anthem or any other busness in their sector. Or for any other business in the US, for that matter.
It is, in short, a joke.
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