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 info@warren.law

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Scarinci Hollenbeck, LLC defends individuals and companies in all types of litigation. Our team has decades of experience in all types of litigation, white collar defense, securities litigation, and financial services enforcement proceedings.