Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

Data Breach Defense: Mobilizing Against Weaponized Mass Arbitration

By Daniella Main and Brooke Bolender
September 01, 2023

Most companies have experienced or will experience a data breach. Increasingly, companies also face the risks associated with mass arbitration weaponized by the overwhelming volume of claims after a breach. This article explores:

  • Mass arbitration's emergence as a class action alternative in data breach cases;
  • The risks and liabilities associated with mass arbitrations;
  • The limited options for mounting an effective response to mass arbitrations;
  • The ways companies can minimize their mass arbitration exposure; and
  • Mass arbitration settlement strategies in data breach cases.

Prevalence of Arbitration Clauses and the Rise of Mass Arbitrations

Arbitration can provide an effective and efficient means of resolving disputes for all parties involved. The prospect of efficient, out-of-court resolution has prompted many companies to insert a binding arbitration clause in most of their consumer contracts. Following the Supreme Court decision in AT&T Mobility LLC v. Concepcion, companies have included consumer-friendly and conscionable arbitration provisions that require the company to pay any arbitration filing fees regardless of which party initiates the arbitration. These arbitrations usually come packaged with class action and jury trial waivers.

The widespread use of consumer arbitration clauses, coupled with the liberal federal policy favoring arbitration under the Federal Arbitration Act, has drawn the ire of many plaintiffs' attorneys, who are effectively blocked from pursuing many consumer actions or class actions in court. Another subset of the plaintiffs' bar, however, has sought to leverage these arbitration clauses into quick settlements. Enter the mass arbitration.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
Beach Boys Songs Written Decades Ago Triggered Current Quarrel With Lawyers Image

There's current litigation in the ongoing Beach Boys litigation saga. A lawsuit filed in 2019 against Nevada residents Mike Love and his wife Jacquelyne in the U.S. District Court for the District of Nevada that alleges inaccurate payment by the Loves under the retainer agreement and seeks $84.5 million in damages.

Major Differences In UK, U.S. Copyright Laws Image

This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.

Strategy vs. Tactics: Two Sides of a Difficult Coin Image

With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.

The Article 8 Opt In Image

The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.

Transfer Tax Implications on Real Property Leases Image

The real property transfer tax does not apply to all leases, and understanding the tax rules of the applicable jurisdiction can allow parties to plan ahead to avoid unnecessary tax liability.