Data Security Breaches Land General Counsel on Chopping Block; Lessons from Yahoo!
Twenty years ago, Yahoo! was the first place anyone looked when browsing the internet. Now, it’s the first place organizations and especially general counsel should look to understand how pervasive the ramifications of data security breaches are – and, more importantly, how devastating it can be when the obligations of data privacy and security are not adequately managed. It’s no secret that Yahoo!’s data security department has been dealt some tough blows recently. Last September, the company announced that 500 million users’ accounts were compromised by a cyberattack in 2014. Just two months later, Yahoo! confirmed that a similar attack had been carried out in 2013, affecting more than one billion accounts. And two weeks ago, it revealed that an unknown number of accounts were inappropriately accessed in 2015 and 2016. As a result of these incidents, Yahoo! has paid $16 million in publicly reported expenses, has lost $350 million from its sale of core assets to Verizon, and is being probed by the Senate Committee on Commerce, Science, and Transportation, among other things. While these consequences are severe, they are unsurprising to anyone who follows data security. The real news is how the breaches have impacted Yahoo!’s legal department.
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