Tennesse State CapitolThe State of Tennessee recently amended its data breach notification statute, Tenn. Code Ann. § 47-18-2107, which is set to go into effect on July 1, 2016. Numerous commentators have proclaimed that the amendment1 marks a watershed moment—that with the enactment of S.B. 2005, Tennessee becomes the first state to eliminate the encryption safe harbor from its data breach notification statute. However, this is not the case; Tennessee has not removed its primary encryption safe harbor. Even under the amended Tennessee law, data encryption remains an important method for securing data, and one that may reduce notice obligations if a breach occurs.

S.B. 2005 makes three changes to the breach notification statute that may impact whether Tennessee’s notification law applies to a particular data breach situation, and when organizations must send notices to affected individuals.
Continue Reading Tennessee Updates Data Breach Notification Law

ThinkstockPhotos-516780641-webThe Consumer Financial Protection Bureau (CFPB) recently brought its first data security enforcement action, adding itself to the growing list of federal regulators tackling data security issues. The CFPB’s enforcement action was against Dwolla Inc., a Des Moines, Iowa-based online payment platform. The CFPB alleged that Dwolla misrepresented its data security practices, and as a result, Dwolla agreed to pay a $100,000 penalty and to implement significant data security measures.1 While this is only its first data security-related action, the CFPB appears to be taking very seriously its role in securing consumers’ financial information. The requirements the agency placed on Dwolla’s board of directors make this clear, as the board will be held accountable for any security shortcoming by the company. This goes beyond the typical requirements imposed by the Federal Trade Commission (FTC), the regulator with the most extensive data security experience, in its data security enforcement actions. As such, companies, especially financial technology start-ups, should take note of the data security requirements placed on Dwolla by the CFPB, and ensure that any statements made regarding the security of consumers’ information are accurate.
Continue Reading CFPB Brings First Data Security Enforcement Action

 On February 23, 2016, the Federal Trade Commission (FTC) announced a settlement with computer hardware maker ASUSTeK Computer, Inc. (ASUS). The ASUS settlement highlights the FTC’s position regarding security in the connected device market: connected
Continue Reading WSGR Alert: FTC Settles with Manufacturer of Home Network Routers over Alleged Data Security Flaws

 President Obama signed the Fixing America’s Surface Transportation Act (FAST Act) into law on December 4, 2015. The FAST Act not only provides long-term funding for highway and infrastructure improvements and other transportation projects, but also includes several privacy- and security-related provisions, including an important provision that may reduce consumer confusion and industry compliance costs by eliminating annual privacy notice requirements for financial institutions in certain circumstances.
Continue Reading FAST Act Eases GLBA Compliance Burdens for Many Companies, Addresses Transportation and Infrastructure Privacy and Cybersecurity Issues

 The European Union will soon have its own first-ever cybersecurity rules, which will impact a broad range of industries, such as transportation, energy, and online marketplaces. On December 7, 2015, the European Parliament and the Council of the European Union, which is comprised of representatives of the 28 EU countries, reached a political agreement on the draft Directive on Network and Information Security (the NIS Directive).1 Although the final text is still being finalized at the technical level, it is expected to be formally adopted in early 2016.
Continue Reading EU Agrees to New Cybersecurity and Incident Notification Rules