The Effects of Data Breach Litigation - paper from the US

"Empirical Analysis of Data Breach Litigation," Sasha Romanosky Carnegie Mellon University - Heinz College of Information Systems and Public Policy David A. Hoffman Temple University - James E. Beasley School of Law; Cultural Cognition Project at Yale Law School  Alessandro Acquisti Carnegie Mellon University - H. John Heinz III School of Public Policy and Management

Source :

Abstract: In recent years, a large number of data breaches have resulted in lawsuits in which individuals seek redress for alleged harm resulting from an organization losing or compromising their personal information. Currently, however, very little is known about those lawsuits. Which types of breaches are litigated, which are not? Which lawsuits settle, or are dismissed? Using a unique database of manually-collected lawsuits from PACER, we analyze the court dockets of over 230 federal data breach lawsuits from 2000 to 2010. We use binary outcome regressions to investigate two research questions: Which data breaches are being litigated in federal court? Which data breach lawsuits are settling? Our results suggest that the odds of a firm being sued in federal court are 3.5 times greater when individuals suffer financial harm, but over 6 times lower when the firm provides free credit monitoring following the breach. We also find that defendants settle 30% more often when plaintiffs allege financial loss from a data breach, or when faced with a certified class action suit. While the compromise of financial information appears to lead to more federal litigation, it does not seem to increase a plaintiff's chance of a settlement. Instead, compromise of medical information is more strongly correlated with settlement.

Also see AT&T Mobility v Concepcion And Compucredit Corp. v Greenwood