Posted on May 2, 2009 by David Navetta

The TJX Case: It Lives! With a New Theory of Liability: "Unfairness"

The last two plaintiff-banks still breathing after 1st Circuit Appeal
Little know (or at least discussed) fact: despite announcing settlements with VISA and Mastercard in 2007, the TJX data security litigation is still going. In fact most of the issuing banks impacted by the TJX breach are no longer pursuing TJX and/or have settled via VISA and Mastercard dispute resolution processes.

However, two financial institutions (Amerifirst Bank and SELCO Community Credit Union - hereinafter "Issuing Banks" or plaintiffs) have pressed forward with an appeal of various dismissals and class certification motions to the U.S Court of Appeals for the First Circuit (the "Appellate Court"). The 1st Circuit's opinion sheds some more (high level) light on the liability risk of payment card data breach security cases. Ultimately, the Appellate Court allowed three theories of liability to proceed, including a previously dismissed theory alleging that TJX's inadequate security amounted to an unfair business practices under Massachusetts's unfair and deceptive business practices law.

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Posted on March 17, 2008 by David Navetta

FACTA Class Action Certified (N.D. Illinois)

All, a link to a recent case that certified a class action under FACTA based on credit card receipts with more than the last five digits and expiration date: (Meehan v. Buffalo Wild Wings Inc., N.D. Ill., No. 07 C 4562)

Interestingly this case goes against rulings in the 9th, 10th and 11th Circuits, which ruled that the "superiority" requirement of Rule 23(b) had not been met because of the potentially staggering statutory damages available under FACTA ($100 to $1000 per violation).

In this case, the court followed 7th Circuit precedent that held that classes could be certified despite staggering damage potential. In this Circuit the issue of staggering damages, however, can still be challenged as a violation of due process rights after the certification.

In short, the certification provides the plaintiffs with more leverage because the class has been established and plaintiff's attorneys will have a large economic incentive to argue all the way through the due process arguments. Companies operating in the jurisdiction of the 7th Circuit should be very careful with their credit card receipts.

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Posted on December 4, 2007 by David Navetta

TJX -- Banks' Motion for Class Certification Denied

This is the court's decision denying class certification by the banks suing TJX. Have not fully read through it, but interestingly it appears that the nature of the negligent misrepresentation claim (e.g. the reliance requirement) is one of the reasons that class cert. was ruled inappropriate.


TJX Denial of Motion for Class Certification

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