Vintage Filings Legal Blog

More than 70 percent of consumers surveyed said they would no longer do business with a company that exposed their sensitive, personal information as result of a data security breach, according to research conducted for Identity Theft 911.

Approximately 77% of respondents said they were “somewhat” or “very” concerned that identity theft could happen to them or someone close to them, and nearly 30% said they had received at least one data breach notification letter in the past two years, with half of those getting more than one letter.

“Businesses have a fiduciary obligation to treat personally identifiable information like assets,” said Matthew Cullina, CEO of Identity Theft 911, America’s leading identity theft resolution and education services provider. “They wouldn’t leave money unprotected, and they should take the same approach with personal data they are entrusted with. Every week, we read about another data breach, and consumers are not only angry, they feel violated when companies do not safeguard their personal information.”

Results of the survey, conducted by GfK Custom Research, include the following:

• If their personal information was exposed, respondents said they would feel “angry” (33%), “violated” (27%), “annoyed” (21%) or “anxious” (14%).
• Depending on their age, 72% to 81% of those surveyed said they were concerned identity theft could happen to them or someone close.
• If their data was exposed, the majority of respondents said they would want: a letter from the company explaining what happened and what was being done to respond (80%); free access to “live” expert fraud specialists providing one-on-one assistance (76%); free credit monitoring tools (70%); and identity theft insurance (55%).

It’s hurricane season, and you might have all the essentials to protect your business if a storm is coming – plywood, tarps, portable generators. But do you have the tools to protect your company’s reputation?

If your business is shut down for days, or even weeks, how will you keep your customers while you get your business up and running again?

“When a hurricane hits, public relations is probably the last thing on the mind of most business people,” says Nicole Gustin, director of crisis communications at Loomis Group, an integrated marketing agency. “Everyone is busy dealing with the aftermath of the storm. But a company’s reputation can quickly take a hit if you aren’t prepared. That’s why you should have a solid crisis communications plan that you can quickly execute in times of disaster.”

Here are some key crisis communications tips for hurricane season:

• Develop a crisis communications plan. It is critical for all businesses to have a public relations strategy in times of disaster, so you are not scrambling in the moment. Executing the right plan can protect your company’s reputation, and even make it stronger, if your community is affected by a storm.
• Talk to your customers. Know how to reach your customers to tell them if you are open for business, or when you will re-open. In today’s world of social media and blogs, the public expects to receive information instantly. If your competitors are luring people with offers on Twitter, and you are still figuring out how to boot up your computer, you could be losing customers.
• Publicize “good Samaritan” efforts. If you are donating supplies or aid to others in need, show your community that you are a good corporate citizen. Such good will efforts may be remembered for many months to come.
• Prepare now. Don’t wait until a storm is coming, when you are concerned with the physical safety of your building and employees and will have little time to devote to public relations.

I’ve been following the BlogWorld conference out here in Las Vegas very closely the past few days. One of the more interesting companies I found was The Media Bloggers Association who have just launched a comprehensive program to provide bloggers access to the same sort of legal and financial resources long available to traditional media organizations including BlogInsure, a first of its kind liability insurance program for bloggers which provides coverage for all forms of defamation, invasion of privacy and copyright infringement or similar allegations arising out of blogging activities.

The cornerstone of the new program is an online course in media law developed by the Media Bloggers Association in partnership with The Poynter Institute’s News University. The course, Online Media Law: The Basics for Bloggers and Other Online Publishers, was co-authored by David Ardia of the Citizen Media Law Project, which is jointly affiliated with Harvard Law School’s Berkman Center for Internet & Society and the Center for Citizen Media and Geanne Rosenberg of the City University of New York’s Graduate School of Journalism and Baruch College. Scott Swift of Media/Professional Insurance created an assessment to evaluate the student’s understanding of the material.

“The past few years have seen unprecedented changes in the media landscape,” said Robert Cox, co-Founder and President of the Media Bloggers Association. “From a handful of bloggers in 2000 to tens of millions today, bloggers have been granted full press credentials, broken major news stories, and dethroned high-profile politicians and media figures. With that success has come greater scrutiny and the inevitable rise in legal threats facing bloggers,” said Cox. “In this new environment, blogger access to education, training, legal advisory services and liability insurance is critical to the sustainability of a strong and vibrant citizen media.”

Because the MBA believes so strongly that all bloggers should take this course, it is made available at no charge and, although the course is an integral part of the new MBA membership application process, bloggers are not required to join the MBA to take the course. Payment of annual dues for MBA membership is not requested until after the course has been completed and bloggers may opt-out of the application process at any time.

After completing the exam, bloggers will be asked to take a course assessment; this exam is a prerequisite for individuals interested in joining the Media Bloggers Association so those wishing to join must opt to report their test scores to the MBA. It is also the basis for the significant discount on liability insurance available to bloggers through the BlogInsure program.

By joining the Media Bloggers Association, individuals have the exclusive opportunity to purchase liability insurance for bloggers through Media/Professional Insurance, a business unit of the Select Markets Division of AXIS Insurance. Insurance will cover costs and damages for claims of defamation, copyright infringement and privacy violation. Media/Professional Insurance, the largest underwriter of media liability insurance in the world, has offered media liability coverage for publishers and broadcasters since 1979, protecting against claims of defamation and infringement.

“As a leader with over 30 years experience protecting free-speech, it is a natural progression to offer coverage for emerging media such as blogs,” according to Leib Dodell, Chairman of Media/Professional Insurance. “Affordable, readily available and easily accessible coverage was critical in our development of the program. Our web-based format allows those interested in BlogInsure to apply, pay for, and get coverage at the click of a button.”

Insured bloggers will have access to a new legal hotline beta program. Through the hotline, MBA Members who purchase insurance will, for a limited time only, have access to a web extranet through which they may submit queries and get answers to legal questions before problems arise. The hotline was created and is operated by the law firm of Sonnenschein Nath & Rosenthal LLP, and overseen by Sonnenschein partner Blaine Kimrey. Sonnenschein is widely regarded as one of the top media defense firms in the United States. This program may be continued beyond the beta period depending on initial results.

Uninsured MBA Members facing legal threats will still have access to the MBA’s extensive network of media liability attorneys around the United States, a program that has helped bloggers in hundreds of cases since 2004. Through the MBA Legal Referral program, MBA members are referred to a lawyer specializing in media law who can provide an evaluation of risks and costs associated with specific allegations and offer some general advice regarding how to respond to allegations of defamation, copyright infringement, and privacy violation. The primary purpose of this program is to rapidly match bloggers with lawyers with specific expertise in the types of allegations commonly arising out of blogging. There is no guarantee legal assistance will be available for a specific case; it is provided on a “best efforts” basis only. This program is not an offer to cover legal fees, related costs or judgments; it is not intended to be a substitute for liability insurance.

Bloggers wishing to join the Media Bloggers Association can visit the MBA web site at www.mediabloggers.org and click the “Membership” link. Membership dues are $25.00 annually.

Many public companies seem to look at corporate insurance as nuisance that can taken care by paying for the minimum amount of coverage.  However I came across a settlement case this morning that illustrated how vital it is to be fully covered. Clear Choice Health Plans (OTCBB: CCHN) announced that it had concluded a settlement agreement that completely absolves the company against liabilities related to a lawsuit filed in 2007 by Priscilla Evans and Dale Evans in Deschutes County Oregon Circuit Court.

Pursuant to the terms of the settlement agreement, the plaintiff will receive $1.5 million. The lawsuit sought to recover damages of $20 million, plus attorneys’ fees. The settlement was covered by insurance, with the company only being responsible for its deductible.

Clear Choice said that although it has always believed that the company had strong meritorious defenses, management concluded, in consultation with its insurance company, that it was in the best interests of the company, employees, customers and shareholders to settle this litigation and put the matter behind it. The settlement will have no material impact on the company’s financial results.

So please make sure you do not take the your corporate insurance needs too lightly, when you need it, insurance will be your best friend.