Victims of Huge Yahoo Data Breach Can Sue the Company, Judge Rules

Victims of Huge Yahoo Data Breach Can Sue the Company, Judge Rules

Victims of Huge Yahoo Data Breach Can Sue the Company, Judge Rules

In a 48-page decision published last Friday, Koh said that the arguments raised in Yahoo's motion to dismiss - such as criticising users for not reading its privacy policy and for continuing to use Yahoo Mail after the attacks - were "unpersuasive". Yahoo eventually admitted the breaches, but only when it had agreed to be acquired by Verizon, leading to Verizon dramatically reducing its bid.

The lawsuit accuses Yahoo and its owner Verizon, which bought the internet giant previous year, of failing to properly disclose details of the 2014 hack, which exposed users to identity theft and forced them to spend extra money and time securing their personal information. Under the accord, investors are slated to get 12 cents for each share of Yahoo stock they owned.

The customers' case is In re: Yahoo Inc. That case was also before Koh, who has proven to be tough on companies that allow private customer data to be stolen or sold for commercial marketing.

Claims made against Yahoo in the lawsuit include negligence and breach of contract.

Koh said customers may have "taken measures to protect themselves" against identity theft and fraud had they known about the breaches sooner.

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Yahoo was accused of being too slow to disclose three data breaches that occurred from 2013 and 2016, increasing users' risk of identity theft and requiring them to spend money on credit freeze, monitoring and other protection services.

The breaches threatened the Verizon deal, cost millions of dollars in legal fees and spurred more than 40 lawsuits, which have been consolidated before Koh for pretrial information exchanges.

The filing mentions several customers whose data was breached by criminals and used to file fraudulent tax returns or credit card charges.

Last year, the US accused Russia of directing some of the world's most notorious cybercriminals to break into Yahoo in 2014 in a criminal indictment alleging a widespread conspiracy by two Russian FSB security agents and a pair of hackers. A lawyer for the plaintiffs did not immediately respond to requests for comment.

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