St. Louis was named after Louis IX (born in 1214!), hosted a World Fair (technically, the 1904 Louisiana Purchase Exposition), the fleur-de-lis is ubiquitous, and we love soccer and football, although we have neither major league football nor soccer teams (St. Louis FC, our USL minor league soccer team, has a crest which features, you guessed it, a fleur-de-lis). However, St. Louis is known as the “Gateway to the West” – directionally away from Europe. Every once in a while, St. Louisans, like the rest of America, need to heed to what is going on over the pond, particularly when it comes to privacy and data security developments. Below is a brief update on a few foreign issues to begin the New Year.

It’s time for year-behind-us reminisces and year-before-us prognostications and, for those of us with nothing better to do during the last few days of 2017 and first few days of 2018, attention turns to HIPAA enforcement. So what happened and what can we look forward to? If past is prologue, expect the sound of silence as there was nominal Office for Civil Rights (OCR) activity in 2017 and, with the one noisy exception, no actions to cause your ears to burn.

In 2016, the U.S. Supreme Court in Spokeo, Inc. v. Robins, provided a potentially powerful Article III standing defense under F.R.Civ.P. 12(b)(1) seemingly applicable to a variety of privacy claims, including FCRA, FACTA, TCPA, and FDCPA statutory damage claims. The Court noted for a plaintiff to establish standing to sue in federal court, she must establish an “injury in fact” consisting of an invasion of a legally protected interest, which is both particularized and concrete.

Spokeo dealt with the “concrete” portion. To be concrete, an injury must be real but may also be intangible. Congress’ intent in creating a right is instructive, but not sufficient. Allegations of a bare procedural violation likely would not suffice to maintain standing. Some injuries create harm, others do not. Thanks for that.

Europe’s data protection rules will undergo their biggest change in two decades when the new General Data Protection Regulation (“GDPR”) goes into effect on May 25, 2018. The GDPR replaces the current Data Protection Directive and imposes uniform data security requirements on all EU members. While the GDPR is “an evolution, not a revolution” for data protection, there are several significant changes for which companies should be prepared.

The advice we always give to clients regarding privacy policies is: “say what you do and do what you say.” It seems simple, but simplicity can be deceiving. Companies want to reassure consumers that their personal data is safe and secure; however, in today’s world, no one can make fail-safe representations of security. Uber’s recent settlement with the FTC illustrates this problem.

With the rise of innovations like cloud technology and software-as-a-service, clients are increasingly finding that it makes business sense to outsource computerized services, from payroll processing to the storage of electronic medical records. While doing so often cuts costs, routing (frequently confidential) data through third-party service providers also implicates serious cybersecurity concerns and, in some cases, may increase potential liability. Further, one of the pillars of a commercially reasonable information security program is selecting and retaining service providers capable of maintaining appropriate safeguards. To address these concerns, and to keep data safe, clients should require service providers to furnish them with Service Organization Control (“SOC”) Reports, particularly SOC 2 Reports.

SOC Reports were developed by the American Institute of CPAs (AICPA) to provide information about the robustness and quality of a service provider’s internal controls over certain types of data. There are three types of SOC Reports, each serving separate functions.

On April 24, 2017, the Office of Civil Rights (“OCR”) announced the first HIPAA settlement based on the impermissible disclosure of unsecured electronic protected health information by a wireless service provider. CardioNet, an ambulatory cardiac monitoring service, provides remote mobile monitoring of and rapid response to patients at risk for cardiac arrhythmias, agreed to pay $2.5 million, and to implement a corrective action plan.

As reported by the OCR, in 2012 CardioNet reported to the OCR the theft of a workforce member’s unencrypted laptop containing electronic PHI (“ePHI”) of 1,391 individuals. OCR’s investigation revealed that CardioNet had an insufficient risk analysis and risk management processes in place at the time of the theft.   Additionally, CardioNet’s provided the OCR draft policies and procedures implementing the HIPAA Security standards, and was unable to produce final policies or procedures implementing the security safeguards for ePHI, including mobile devices.

I recently decided to reread Dante’s The Inferno. One would not expect guidance on IoT privacy and data security (IotPDS) from a 700 year old text, but The Inferno, particularly Canto III, provides significant direction on consumer IoTPDS issues.  So,

“Abandon All Hope, You Who Enter Here.”

Ransomware. It is the word every corporate board and IT team fears. Ransomware is a type of malicious software that can quickly shut down an entire network of computers and compromise an enormous amount of critical data. Often, when a ransomware attack occurs, all connected systems are locked down and a message appears on the…