Trade dress insurance coverage is alive and well. At least in Wisconsin. In Acuity v. Ross Glove Company, 2012 WL 1109035 (Wis. Ct. App. April 4, 2012), the Wisconsin Court of Appeals held that an insurer’s duty to defend was triggered under advertising injury liability coverage where the underlying complaint set forth allegations of trade dress infringement.

In the Acuity case, Ross Glove purchased a commercial general liability policy from Acuity, which included advertising injury liability coverage. The policy at issue defined “advertising injury”, in part, as “infringing upon another‘s copyright, trade dress or slogan in your advertisement.”

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Cloud computing is the storage of data on remote computer servers and the sharing and transmittal of such information by way of the internet.  Use of the cloud enables both businesses and casual users to maintain as much or as little electronic data as they wish on a third party’s mainframes without the need for or the expense of having to buy and maintain their own hardware systems.

The cloud’s economic benefits are clear.  Still, clouds can be a legal minefield for companies and their counsel. Data breaches, hosting of illegal content and inaccessibility of critical business information are just a few examples of turbulent situations cloud users can face.

Given the risks and potential rewards of the cloud, consider the following guide before entering into a cloud provider contract:

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The following article, written by my colleague Nicole Moody, first appeared in the Chicago Daily Law Bulletin. Thanks to Nicole for allowing us to republish it here.

Rick Bortnick

Many of us have been there. Sipping our morning coffee, signing into our Facebook accounts, waiting to see what notifications will greet us. We are intrigued to see that we have a friend request.  Who could it be? An acquaintance from the past? A new colleague who we met at work? Whoever it is, we know that by accepting the request we will be granted access into this individual’s life and will know more about them in five minutes than we would know in a lifetime of small talk.

Due to the use of usernames and passwords, there is a belief that information shared on Facebook is confidential unless publicly shared. However, courts around the country are now addressing just how private this information really is.

In cases nationwide, litigants are asking courts to grant unfettered access to other parties’ Facebook or other social media accounts. Inevitably, in the age of status updates and hashtags, poking and friending, the lines between public and private information have become blurred. This trend has become increasingly prevalent in the insurance industry as insurance companies have realized the usefulness of social media in litigation. 

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Businesses that necessarily require their customers to disclose credit card and personal information, beware.   Just five days ago, the United States Court of Appeals for the First Circuit held that claims by class action plaintiffs for ”mitigation damages” arising from alleged negligence and breach of contract were viable.  Anderson v. Hannaford Brothers Co., Nos. 10–2384, 10–2450, 2011 U.S. App. LEXIS 21239 (1st Cir. Oct. 20, 2011). 

In Anderson, the electronic payment processing  system of a national grocery chain, Hannaford Brothers Co., was breached by hackers in 2007. This resulted in the dissemination of as many as 4.2 million credit card and debit card numbers, expiration dates, and security codes.  Hannaford Brothers was not notified of the breach until February 27, 2008 and subsequently contained the breach on March 10, 2008.  A week later, Hannaford released a statement regarding the breach and announced that over 1,800 cases of fraud resulting from the theft already had been reported. 

Following Hannaford’s announcement, several financial institutions immediately cancelled customers’ debit and credit cards.  Some financial institutions, which refrained from immediately canceling the credit card, monitored the accounts for unusual activity, cancelling the cards, in many cases, without notifying the customer.  Customers who asked that their cards be cancelled incurred fees from issuing banks for the replacement cards. 

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Faced with revitalizing a deteriorated economy, formulating a national budget, and the aftermath of Osama Bin Laden’s death, President Barack Obama has his hands full. Yet, in the midst of all the issues commanding the White House’s attention, the Obama Administration somehow has found time to address the threats to our nation’s cyber security.

According to Business Insurance, on Thursday, May 12, 2011, the Obama Administration proposed cyber security legislation to improve protection for individuals and the federal government’s computer and network systems. The proposed legislation would address national data breach reporting by creating simpler and standardized reporting requirements for the 47 states that contain such requirements. The proposal would also synchronize penalties for computer crimes with other crimes. Additionally, the government, through the Department of Homeland Security, would become directly involved in assisting the industry as well as state and local governments in policing and enforcing cyber security. The proposed legislation encourages the state and local governments to share information with the Department of Homeland Security about cyber threats or related incidents by providing them with immunity for doing so.  
 
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Data security breaches pose a serious threat to a corporation’s financial stability as well as to its credibility in the marketplace. Most notably, the 2007 TJX data security breach, where 45 million credit card and debit card numbers were stolen, cost the company over $4 billion. For many corporations, the solution is to purchase a cyber liability insurance policy, which provides insurance coverage in the event of such a breach.

The risk of data security breaches has also affected students of universities throughout the nation. In June of last year, Cornell University officials informed 45,000 members of the school’s community that their personal information, including their names and social security numbers, was stolen after a University-owned laptop was stolen. Due to such breaches, college officials nationwide have begun purchasing cyber liability insurance policies to offset the financial burdens of a data security breach.

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Google, Facebook, Twitter, Foursquare—millions of Americans, including myself, depend on these cyber sites as their gateway to information and communication in the outside world.  What we may not realize, or choose to ignore for convenience’s sake, is that this gateway lies on a two-way street. The information that we seek using websites such as Google and what we communicate on Facebook and Twitter provide companies with vital data to better market their products to us.  This use of information is referred to as “data mining. ”

An example of data mining can be seen in the advertisements that pop up on the side of your Facebook home page.  Such ads are often relevant to the information posted on your “Profile” page, such as advertisements promoting products from your college alma mater. 

At the outset, data mining seems like a win-win situation for both the consumer and the seller—the consumer is marketed with a product in which they are seemingly interested and the company has utilized its advertising budget in an informed, cost-effective manner.  At the same time, however, the threat of an invasion of privacy is real and has the attention of members of Congress and federal officials to create legislation regulating the way in which, and the extent to which, our personal information is shared with third parties. 

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