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AlertBoot offers a cloud-based full disk encryption and mobile device security service for companies of any size who want a scalable and easy-to-deploy solution. Centrally managed through a web based console, AlertBoot offers mobile device management, mobile antivirus, remote wipe & lock, device auditing, USB drive and hard disk encryption managed services.

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AlertBoot offers a cloud-based full disk encryption and mobile device security service for companies of any size who want a scalable and easy-to-deploy solution. Centrally managed through a web based console, AlertBoot offers mobile device management, mobile antivirus, remote wipe & lock, device auditing, USB drive and hard disk encryption managed services.

Cost Of Data Breaches Will Not Include Perceived, Possible Losses

All but one of the claims in the Hannaford lawsuit have been tossed by the presiding judge, which, honestly, doesn't come as a surprise.  It looks that, for the time being, the cost of a data breach will not and cannot include potential damages.  Of course, that doesn’t mean that data security products like data encryption from AlertBoot are not necessary.  It just means the data breach costs will not include perceived ills.

Why Claims Were Tossed

There is a long tradition, supposedly, that the law cannot make reparations for what might happen (I'm not a lawyer, so I'm only relaying what I've heard).  So, until the day we have a Minority Report-like system in place, the law can only recompense if people can prove damages actually took place.

But it's not that simple.  For example, those who could prove fraudulent charges were made on their cards had their cases tossed as well, since pretty much all of them had their charges reversed by the credit card companies.  Reversed charges means no damages, at least per this judge.

Thus, the only complaint that stood is one "from a woman who said she had not been reimbursed by her bank for fraudulent charges on her bank account following the Hannaford breach."

Which is problematic on its own.  If you're a Hannaford customer and you are a victim of identity theft, are the two related?  Or are you a victim because of some other breach at some other company that happened some time ago?  In the case above that didn't get tossed, I guess, it was ascertained that there was a causal relation between the two.

Companies Cannot Breathe In Relief

Despite the courts taking the side of affected companies, these can't rest easy.  Companies that experience future data breaches will continue to defend themselves from lawsuits.  After all, today's results won't deter future plaintiffs.

Plus, legal fees aren't the only costs companies must consider.  Without the proper data security measures (emphasis on "proper"...encryption software, while a powerful data protection method, cannot solve all of your security problems), other costs will show up in the forms of mailings, call centers to handle inquiries, PR efforts, cancelled cards ($10 per account to replace these, if I'm not wrong), etc.

As the saying goes, prevention is better than the cure.  So, minimize the chances of having a data breach at your company by sitting down, figuring out what needs to be protected, and implementing your data security ASAP.

Related Articles and Sites:
http://www.wired.com/threatlevel/2009/05/court-rules-breach-victims-not-entitled-to-restitution/
http://www.boston.com/business/articles/2009/05/14/judge_tosses_most_data_breach_claims/

 
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About sang_lee

Sang Lee is a Senior Account Manager and Security Analyst with AlertBoot, Inc., the leading provider of managed endpoint security services, based in Las Vegas, NV. Mr. Lee helps with the deployment and ongoing support of the AlertBoot disk encryption managed service. Prior to working at AlertBoot, Mr. Lee served in the South Korean Navy. He holds both a B.S. and an M.S. from Tufts University in Medford, Massachusetts, U.S.A.