ANALYSIS: Implied Contracts Add Legal Risk to Data Breach Cases

A new source of potential liability is emerging in data privacy and cybersecurity. Recent data breach cases and statistics show that customers and employees are suing data handlers for breaking implied promises to safeguard personal information. Even in the absence of a signed agreement that neatly spells out a company’s obligations, a court may deem that such a contract implicitly exists.

There are two identifiable trends in this space. One is based on a statistical review of complaints filed; the other, on a qualitative review of recent opinions. First, the data.

Data-Related Claims Are Increasing

The most recent decisions on ...