On July 26, 2023, the U.S. Securities and Exchange Commission (“SEC”) adopted new rules specifying enhanced disclosure regarding cybersecurity risk management, strategy governance, and incident disclosure. The SEC first proposed new cybersecurity rules back in March 2022. The agency’s comments to the final rule suggest greater disclosure and improved consistency of disclosures will benefit investors. Several of the key aspects of the final rules are outlined below, and ultimately will probably be navigable for organizations with meaningful incident response and evaluation experience as well as robust risk management programs which already include and evaluate cybersecurity.Continue Reading SEC Issues Final Cybersecurity Rules Enhancing and Modifying Disclosure Requirements: Companies will want to Measure Twice and Cut Once
In a ruling on April 22, 2021, the United States Supreme Court unanimously held that § 13(b) of the Federal Trade Commission Act (the Act) does not authorize the Federal Trade Commission (FTC) to seek, or a court to award, equitable monetary relief such as restitution or disgorgement. The FTC previously used § 13(b) as…
Virginia’s governor, Ralph Northam, signed the Virginia Consumer Data Protection Act (CDPA) into law on March 2, 2021. The CDPA is set to take effect on January 1, 2023, and is the second most comprehensive consumer privacy law to be enacted in the United States behind the California Consumer Privacy Act (CCPA), recently amended by…
On March 2, 2020, Reed Smith and the International Association of Privacy Professionals (IAPP) presented a panel discussion on 2020 privacy laws and trends featuring Attorney General Christopher Carr of Georgia; Linda Holleran Kopp of the Bureau of Consumer Protection, Division of Privacy and Identity Protection of the Federal Trade Commission (FTC); and Oriana Senatore, Senior Vice President of Policy & Research at the U.S. Chamber Institute for Legal Reform (ILR).
A clear theme from the discussion was that federal legislation is the best path for privacy reform in the United States. The current “patchwork quilt” of federal and state data privacy laws and enforcement by the FTC (and other agencies) as well as by states – now complicated exponentially by enforcement actions by cities and counties and the presence of private rights of action increasingly proposed for state privacy legislation – is not the way to best balance privacy consumer protection and business compliance. Indeed, the evolving privacy landscape is now approaching a “crazy quilt patchwork.”
Continue Reading Georgia AG, FTC and US Chamber Institute for Legal Reform discuss “crazy quilt patchwork” of privacy laws in the US
On January 6, 2020, the Director of the Federal Trade Commission’s (FTC’s) Bureau of Consumer Protection, Andrew Smith, published a blog post highlighting recent changes to the Commission’s enforcement orders relating to data security. Industry leaders, law practitioners, Congress, and even the courts have been critical of aspects of the Commission’s data security orders. In the post, titled New and improved FTC data security orders: Better guidance for companies, better protection for consumers, Smith acknowledges that, upon arriving at the FTC, strengthening the FTC’s orders in data security matters was among Chairman Joseph J. Simons and his first priorities. Smith’s blog post is a useful roadmap to help understand the practices the Commission requires of companies under its orders. Lawyers often look to these orders to distill advice for clients in a challenging area where the public shaming of companies after data security incidents is rampant.
The FTC began working towards specific improved data security orders in 2019, and Smith cites seven different 2019 data security orders in an effort to lay out some of these improvements. The improvements, he notes, resulted in part from a December 2018 FTC hearing addressing areas of improvement for data security orders, as well as a 2018 Eleventh Circuit Court of Appeals decision.
As a result, Smith highlights three major changes that “improve data security practices and provide greater deterrence” for companies and enhance enforceability. These changes fall into the following three categories:
(1) The orders are more specific.
(2) The orders increase third-party assessor accountability.
(3) The orders elevate data security considerations to the C-Suite and Board level via executive certifications modeled after similar certifications in securities and other laws.Continue Reading New key features of FTC data security orders highlighted by Consumer Protection Bureau Director