Legal Roundup: Insurance Fees for Wrongful Murder Conviction, Facebook’s Continued Data Woes and More
Facebook Accused of Warning Employees (But Not Users) of Security Concern
The Case: In the wake of a massive data breach affecting up to 29 million users, Facebook is being sued over its single sign-on technology which lets people to log into other apps by simply logging into Facebook. Plaintiffs argue that it could open the door for hackers to use compromised accounts to log into third-party applications and websites.
Reuters explains that Facebook is being accused of warning employees about the potential threat, but not users.
Quoting a “heavily redacted section” of the filing from the U.S. District Court in San Francisco, Reuters said: “Facebook knew about the access token vulnerability and failed to fix it for years, despite that knowledge.” The court docs also say, according to Reuters: “Even more egregiously, Facebook took steps to protect its own employees from the security risk, but not the vast majority of its users.”
Scorecard: Despite the concerns raised by plaintiffs, it appears that hackers did not gain financial data or use the single sign-on for nefarious purposes during the recent breach.
Engadget reports: “There were concerns at the time that hackers could use the compromised accounts to log in to other services using the Facebook Login feature, though investigators found that this had not occurred.”
Takeaway: Data security needs to be top-of-mind for any company — especially one that has data on hundreds of millions of people.
Port Wins $2 Million Settlement After Insurers Refuse to Cover Cleanup
The Case: The Port of Port Angeles, Washington, sued its insurance companies over their refusal to cover three harbor clean-up projects.
The lawsuit — Port of Port Angeles v. Certain Underwriters at Lloyds, London and Certain London Market Companies, et al. “alleged that numerous insurance companies, some of which have covered the port since the 1960s, breached their duties of good faith by failing to cover the port’s environmental liabilities. The state Department of Ecology identified the port as being partially responsible for removing potentially harmful substances from the three sites,” according to Peninsula Daily News.
Scorecard: Port commissioners voted 3-0 to provide an unrestricted $2 million to the port, ending more than four years of litigation.
Takeaway: In many cases, environmental remediation costs should be covered by insurers.
Is Insurer on the Hook for Payment to Man Falsely Imprisoned for Murder?
The Case: In 1988, Johnny Small was convicted of murder.
In 2016, his conviction was overturned “after evidence was presented that the police department had coerced false testimony during the trial,” according to Port City Daily.
After 28 years in prison, the City of Wilmington, North Carolina agreed to a $7 million settlement with Small — but the city is now suing Travelers Indemnity Company to recoup that money.
Scorecard: The City claims that “Travelers is the successor to USF&G Insurance — the company that issued the city its policy from 1988-1989 — and is thereby responsible,” Port City Daily reported.
They say the insurance policy includes coverage for damages arising from false arrest, detention or imprisonment, and malicious prosecution. Travelers successfully motioned to move the case to federal court. We’ll see how the case progresses.
Takeaway: As DNA evidence and other tools become more prevalent, more and more convictions will be overturned — leading to civil suits from wrongfully imprisoned people.
Will insurers foot some of those bills? This case will help bring some clarity to that issue. &