The Canadian Privacy Law Blog: Developments in privacy law and writings of a Canadian privacy lawyer, containing information related to the Personal Information Protection and Electronic Documents Act (aka PIPEDA) and other Canadian and international laws.

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The author of this blog, David T.S. Fraser, is a Canadian privacy lawyer who practices with the firm of McInnes Cooper. He is the author of the Physicians' Privacy Manual. He has a national and international practice advising corporations and individuals on matters related to Canadian privacy laws.

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The views expressed herein are solely the author's and should not be attributed to his employer or clients. Any postings on legal issues are provided as a public service, and do not constitute solicitation or provision of legal advice. The author makes no claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained herein or linked to. Nothing herein should be used as a substitute for the advice of competent counsel.

This web site is presented for informational purposes only. These materials do not constitute legal advice and do not create a solicitor-client relationship between you and David T.S. Fraser. If you are seeking specific advice related to Canadian privacy law or PIPEDA, contact the author, David T.S. Fraser.

Wednesday, September 28, 2005

Survey says security breaches cost companies customers 

The Ponemon Institute, which is a good source of such things, has conducted a survey of consumers in the United States which suggests that consumers are willing to show their displeasure over security breaches by ending relations with companies that have compromised their data:

Data Security Breaches Impact Corporate Bottom Lines:

"...'Companies lose customers when a breach occurs. Of the people we surveyed who received notifications, 19 percent said that they have ended their relationship with the company after they learned that their personal information had been compromised due to security breach. A whopping 40 percent say that they are thinking about terminating their relationship,' said Larry Ponemon, founder and head of the Ponemon Institute.

Even more disconcerting, the survey also reveals that five percent of Americans have hired lawyers upon learning that their personal information may have been compromised.

'Five percent may not seem like much, until you realize that anywhere between 23 million and 50 million Americans have received notification of a data security breach. That means that over one million people out there are likely seeking legal counsel,' said David Bender, co-head of White & Case's privacy practice. 'This should be particularly troubling to companies, especially in light of several putative class-action lawsuits recently filed in California against companies that experienced security breaches.'

Bender added that while it's unclear just how any court might calculate damages for customers whose personal information has been breached, but have not suffered any clear harm, the fact that the plaintiff's bar is taking on such suits means they anticipate that courts may commiserate with customers' frustration over breaches...."

More coverage at Computerworld: Survey: Security breaches could prove costly to data companies.

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