Target settlement reached

John Lande Iowa Banking Law Iowa Cybersecurity Law Dickinson Law Des Moines Iowa

Posted on 12/22/2015 at 03:43 PM by John Lande

On December 2, 2015, the United States District Court for the District of Minnesota approved a settlement between Target and financial institutions arising from a 2013 data breach. Target will provide $39 million to settle claims with banks for the losses they suffered as a result of the data breach. This blog has been following the Target litigation since its inception. The case has already developed some new law by finding that the retailer owed a duty to banks to secure the retailer's systems.

Target has reportedly incurred costs of close to $290 million as a result of the data breach. This could be the most that a retailer has ever paid after a data breach. In fact, after final settlement payments are made, Target will likely have paid for nearly all of the costs associated with the data breach. The settlement represents an important precedent for financial institutions. As large retailer data breaches have become ubiquitous, financial institutions will be called upon to reimburse more and more customers for losses. Retailers beginning to share responsibility for those loses will help defray some of the costs associated with large data breaches. This blog has urged banks to talk to its business and consumer clients about sharing responsibility for data breach. With the prevalence of cyber threats, banks will be well served by taking as many steps as possible to protect their institutions.

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