Dykema

Subscribe to Dykema's Posts

Note: This story featuring commentary from Dykema’s Cinthia Granados Motley was originally published by Bloomberg Gov. 

  • Critical infrastructure industries would have to report hacks
  • Spending deal heading for House vote later on Wednesday

By Maria Curi | March 9, 2022, 5:31AM ET

Cybersecurity legislation that would impose new hack and ransomware reporting requirements on businesses was included in a spending bill lawmakers unveiled early Wednesday.

The Senate passed the cyber reporting requirements on March 1 under a bill (S. 3600) from Sen. Gary Peters (D-Mich). Peters previewed their inclusion in the spending bill Tuesday. …
Continue Reading Cyberattack Reporting Requirements Included in Spending Deal

shutterstock_1363031108

Last week FireEye announced publicly that it had suffered a cyber-attack by  a “highly sophisticated state-sponsored attacker utilizing novel techniques.”[1] FireEye is a leading cybersecurity firm whom provides information security services and tools, including forensic investigation services, to high profile clients worldwide. In its public disclosure of the breach, FireEye reported the threat actor specifically targeted its Red Team tools. FireEye then preemptively released the means and methods to detect those Red Team tools. In its investigation of the incident, FireEye discovered that a widely used IT service provider, SolarWinds®, had also been hacked. The threat actor infiltrated SolarWinds and then packaged a malicious trojan into a normal SolarWinds update. SolarWinds believes as many as 18,000 clients may have download the update with the malicious trojan.
Continue Reading CISA Issues Warning to Mitigate Widespread Vulnerability

shutterstock_1251170581

Cannabis companies nationwide are facing yet another statutory obstacle that can have serious (and potential ruinous) consequences for the emerging industry if not appropriately addressed—the Telephone Consumer Protection Act (“TCPA”). There is a recent uptick in class-action lawsuits filed against cannabis companies across the country premised on alleged violations of the TCPA including lawsuits in Michigan and California. These complaints allege cannabis companies sent unsolicited marketing text messages or placed automated phone calls to individuals without their consent. Cannabis dispensaries and other cannabis-related businesses should add TCPA compliance protocols to their checklist of regulatory requirements to be satisfied in this quickly emerging industry.

The TCPA

Enacted in 1991, the TCPA heavily regulates the ability to send phone, text, or facsimile messages through automatic telephone dialing systems. Non-compliance with the statute can be costly, as companies found to have violated the TCPA can be liable for $500 per call or text sent in violation of the Act, and up to $1,500 for willful or knowing violations. Damages are also not capped under the TCPA, so even a small number of texts or calls sent to a large number of recipients can lead to hefty damage awards. The ability to recover significant damages results in most TCPA claims being brought as class-actions. As a result, it is imperative that cannabis businesses that communicate with customers via text or by phone understand the rules governing the TCPA to avoid or at least minimize their liability exposure. …
Continue Reading Why Cannabis Companies Need to Care About the TCPA

shutterstock_771481831

This article is the last in our series on the threat APTs pose (you can find part 1 here and part 2 here) and focuses on the practical steps organizations can take to guard against APT attacks. Given the sophisticated, patient nature of APTs and the varied methods they use to compromise their targets, no single solution can prevent APT attacks. However, companies that take a comprehensive approach to their security posture and maintain a strong understanding of their own data and network can mitigate the threats posed by these entities.

Specifically, strengthening compliance with cybersecurity laws and industry regulations, maintaining multiple layers of network security, and educating employees on APT attacks can help organizations defend against APT intrusions. Further, organizations with updated data inventories, a strong understanding of their data management policies, and a definite baseline of ordinary network activity can place themselves in the best position to identify APT activity before it is too late. …
Continue Reading U.S. Cyber Intelligence Warning Highlights Security Threat From Nation-Sponsored Advanced Persistent Threats (APTs) – Part 3

shutterstock_1385367863

On July 6, the United States Supreme Court issued its decision in Barr v. American Association of Political Consultants, Inc.. The Court considered whether a 2015 amendment to the Telephone Consumer Protection Act (“TCPA”) that created an exemption for debt collection calls relating to debts owed to, or guaranteed by, the federal government ran afoul the First Amendment. The American Association of Political Consultants, Inc. (“AAPC”) wished to make political calls to cell phones, just as the collectors of federal government debt are allowed to. The AAPC challenged the 2015 amendment’s constitutionality, claiming that it violated the First Amendment because it content-based and did not satisfy the strict scrutiny standard. The Fourth Circuit Court of Appeals agreed that the exemption unconstitutional but declined to strike down the entire TCPA as unconstitutional. The Fourth Circuit instead elected to sever the constitutionally offensive amendment and permit the balance of the TCPA to stand. The Supreme Court appeal considered two discrete questions: (1) whether the 2015 exemption for debt collection calls relating to government-backed debt was constitutional; and (2) if not, then what was the proper remedy to address the constitutional violation. …
Continue Reading The Big TCPA Case That Wasn’t

shutterstock_300304496

In a case of first impression, the Seventh Circuit just answered a much-anticipated question about standing in cases filed under the Illinois Biometric Information Privacy Act (“BIPA”).  Bryant v. Compass Grp. USA, Inc. decided whether a BIPA plaintiff has Article III standing. The answer is both yes and no.  This dual answer is not surprising given the awkwardness of the arguments presented. Though the holding is a victory for the defense bar, Bryant is the latest evidence of an ever-increasing circuit split that should culminate in the United States Supreme Court further clarifying its holding in Spokeo v. Robins concerning Article III standing.

Like most BIPA cases, the Bryant complaint was originally filed in Illinois state court. The Bryant plaintiff asserted claims under both sections 15(a) and 15(b) of BIPA. The former relates to the defendant’s failure to make publicly available disclosures, and the latter relates to the defendant’s failure to secure the plaintiff’s individual informed consent. The defendant removed the case to federal court. The plaintiff then moved to remand, ironically contending that she lacked a sufficiently concrete injury in fact to maintain Article III standing to maintain federal court jurisdiction. The defendant paradoxically argued that plaintiff alleged such an injury, relying on the Illinois Supreme Court opinion in Rosenbach v. Six Flags Entm’t Corp., wherein the court held that a violation of the right to receive certain information is an actionable grievance. The novelty of these arguments was not because of their substance, but instead, which side advanced them—an observation that Judge Wood noted in her opinion. Siding with the defendant, the district court remanded the case, and the plaintiff appealed. …
Continue Reading BIPA Case Addressing Article III Standing Foreshadows Potential SCOTUS Review of Spokeo

shutterstock_1688827552

The California Consumer Protection Act (“CCPA”) was in effect for just over three months when the American economy stopped cold in the face of the COVID-19 global pandemic. Much effort was expended in the months before the January 1, 2020 effective date to ensure compliance with the CCPA which, like its European cousin, the General Data Protection Regulation (“GDPR”) aspires to protect data and personal information. But also like the GDPR, many anticipated enforcement by the California attorney general (scheduled to begin on July 1, 2020) to provide guidance on how the CCPA would be interpreted and applied. Then the world came to a halt. Literally. Notwithstanding, as discussed in our earlier post, the California Attorney General has signaled that businesses subject to the CCPA should not expect any delays in enforcement. To be clear, privacy concerns did not cease to exist because of the pandemic. These concerns simply took a back seat as the world focused on defeating the virus. But privacy rights may be moving to the forefront again with the advent of COVID-19 tracking applications under consideration by governments seeking to use this technology to contain the spread of the virus. Most recently, on April 10, 2020, Google and Apple announced a joint endeavor to use Bluetooth technology in conjunction with apps from public health authorities to allow contact tracing of those individuals affected with COVID-19. The system is supposed to ensure users’ privacy and operate only with valid consent. See also our recent blog post on Locating COVID-19 Without the Location Data. Although tracking technology is not new–other iterations were used to track other diseases such as the seasonal flu–its use here would be one of the first to be used in the CCPA era. And arguably, the need to comply with the CCPA–passed by referendum in one state–has affected the usefulness of contact tracing solutions in every state. The Apple-Google solution, for example, covers the vast majority of mobile devices and is likely to be the only solution agreed upon by these two companies. It skirts the need to handle geolocation data, reducing the regulatory footprint under the CCPA, but the very lack of geolocation data degrades the usefulness of this system to local governments for finding and locking down hotspots–and to users in avoiding them. Few, if any, privacy professionals envisioned that preparation for CCPA compliance needed to include protocols for responding to governmental requests for data in combatting a public health crisis. But here we are. …
Continue Reading Will COVID-19 Finally Prompt a Federal Privacy Law?

shutterstock_1281523321

Bad actors love crises. The forced telecommuting of millions of employees (and the attendant exponential increase in use of remote access technologies), coupled with real fears and concerns regarding the spread of COVID-19, have produced a fertile environment for an increase in cyberattacks. Trend Micro reports that COVID-19 is being used in a variety of malicious campaigns including email spam, business email compromise (i.e., using stolen information to initiate fraudulent wire transfers), malware, ransomware, and malicious domains. Trend Micro estimates that nearly 66% of these attacks involve email spam. Both Trend Micro and Sophos have separately reported discovery of what Sophos calls a “dirty little secret” scam: users receive an email asserting that the sender knows their whereabouts and other personal information, and threatens that if the user refuses to pay a fairly large sum ($4000 in one instance), they will infect your family with coronavirus. Nasty, eh?

With this increased risk environment, and everyone’s guard down a bit as we focus on simply trying to keep doors open, it is important for those responsible for data security to undertake basic steps to lessen the success of these attacks. These steps can include: …
Continue Reading Strengthening Your Cybersecurity in the Age of the Coronavirus

shutterstock_1608266686

Coverage litigation relating to liability claims arising out of the Illinois Biometric Information Privacy Act (“BIPA”) has been relatively non-existent. One reason for this may be insurers’ reasonable conclusion that an exclusion introduced in 2006 in response to litigation arising under the Telephone Consumer Protection Act (“TCPA”) applies to this new genre of privacy litigation. That exclusion, generically referred as the Violation of Statutes Exclusion, was the insurance industry response to decisions from around the country finding that TCPA violations qualified as “personal injury” under liability policies. The exclusion evolved over time and now includes a catch-all provision that applies to violations of federal or state statutes or ordinances or regulations other than the enumerated statutes referenced in the exclusion—the TCPA, the CAN-SPAM Act of 2003 and the Fair Credit Reporting Act (“FCRA”). The Illinois court’s opinion in Westbend Mutual Insurance Ins. Co. v. Krishna Schaumburg Tan, Inc., 2020 Ill.App.(1st) 191384, is an example of how important the wording of that catch-all provision is for insurers seeking to rely on it to exclude coverage for BIPA violations. …
Continue Reading Not All Violation of Statutes Exclusions Are Created Equal

shutterstock_294483038

As businesses and privacy professionals were holding their breath awaiting the California Governor’s signature on pending amendments to the much anticipated California Consumer Privacy Act (“CCPA”), California’s Attorney General took the spotlight yesterday by releasing the similarly anticipated CCPA Regulations, Cal. Code Regs. tit. 11, .§999.300, et seq. (“Regulations”). Since the passage of the CCPA in June 2018, the regulations to accompany the CCPA have been touted as “guidance” on how to comply with the CCPA. Although only in draft form, some may argue that the newly released regulations increase the CCPA compliance burden, while others may argue the Regulations merely provide much needed detail on how to comply with the CCPA.

On October 10, 2019, California’s Office of the Attorney General released a notice of proposed rulemaking action, text of the proposed regulations, initial statement of reasons, and economic impact statement. The deadline to provide comments is December 6, 2019. …
Continue Reading The Regs are In! California’s Attorney General Releases the Long Awaited CCPA Regulations