Benecard 3rd Circ. Win Is Latest Setback For Hack Victims

Allison Grande reports:

The Third Circuit recently refused to allow Benecard Inc. employees and customers to proceed with negligence and breach of contract claims against the company in the wake of a data breach, creating a new obstacle for those pursuing data security class actions against employers and service providers in the absence of clear contractual liability or property damage.

In a unanimous opinion issued Thursday, a three-judge appellate panel declined to narrow the scope of Pennsylvania’s economic loss doctrine to allow a proposed class to bring negligence claims against Benecard, a health care benefits company whose systems were infiltrated by hackers who purportedly used the employee and customer data they obtained to create phony tax returns.

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