Court Rules that SEC Stepped-Up Cyber Scrutiny in Data Breaches Does Not Constitute Duty of Loyalty Breach

In a recent article from Reuters, the SEC can target a company because of a data breach, but that does not constitute the standard for the breach of the duty of loyalty. On the contrary, companies can also be sued by its shareholders because of a data breach. The court ultimately ruled that despite this cyber security breach, it does not constitute bad faith. This case is not only an example of shareholder litigation but also a regulatory enforcement defense.

If you have been sued for fiduciary duty based on cybersecurity, contact the attorneys at Warren Law Group for a complimentary assessment: (866) WLGROUP, or email

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Christopher D. Warren

Christopher D. Warren, Managing Partner