SDV Insights

The European Union's ("EU") General Data Protection Regulation ("GDPR") has been in effect for just over a year, and the full extent of the data privacy law's global impact is just now being fully realized.

Earlier this month, SDV reported on a recent Second Circuit case where the court broadly interpreted the "direct loss" requirement to find coverage for a cyber fraud, email spoofing scam. Now, the Sixth Circuit Court of Appeals has issued a similar opinion in American Tooling Center, Inc. v. Travelers Casualty & Surety Company, finding coverage for a company that lost $834,000 to a similar scam. These recent decisions may indicate a trend in favor of policyholders on the "direct loss" issue.

On Friday, July 6, 2018, the United States Court of Appeals for the Second Circuit held that a fraudulent email that caused a company to transfer $4.8 Million to the fraudster was a "direct loss" and was, therefore, covered by the company's computer fraud insurance.

In a pro-policyholder decision, LAW360.com reported that a New York federal judge recently ruled that a thief's use of emails to trick employees of Medidata into wiring money overseas was a covered incident under the company's computer fraud policy, weakening insurers' arguments that such coverage is meant to apply only to hacking into policyholders' computers.

What happens when a senior vice president ignores a litigation hold and deletes tens of thousands of emails? A $3 million sanction.

On November 15, 2016, 1:00 - 2:30 PM ET, SDV Southeast Managing Partner Gregory Podolak will be participating in the American Bar Association webinar, "Assessing the Situation: How to Identify and Evaluate a Contractor's Cyber and Data Risks."

In an effort to encourage businesses to mitigate the risk of a data breach, House Republican Ed Perlmutter has introduced a bill offering a tax credit to businesses that purchase qualifying cyber insurance policies

If you are a small company worried about keeping your client data safe, there are now a number of options to help. SDV's Gregory Podolak was recently interviewed by LAW360.com on his thoughts.

With cyber fraud becoming more prevalent in today's business world, policyholders should be aware of some of the points raised by commercial crime insurers to deny coverage.

For several months we have been closely following the negotiations leading up to the adoption of the US-EU Privacy Shield.