Yahoo! Cyber Breach Settlement Gives Shareholders Cause For Cheer

A U.S. data breach class action has settled for $80 million, bringing the action, which commenced in early 2017,¹ to a relatively quick and, for the putative class, satisfying end.

The Shareholder Class Action

The action concerned two massive data breaches, the first in 2013 involving over one billion user accounts, while the second in 2014 involved over 500 million accounts. Neither breach was revealed until late 2016. Unlike most cyber-breach related class actions, the class members were not the users whose private information was hacked, but rather they were the shareholders of Yahoo who saw the company's share price tumble following news of the breach. The timing of the belated announcements (Yahoo was in talks to be bought by Verizon) caused a precipitous drop in share price.² The lawsuit, brought under the Securities Exchange Act of 1934, was for damages and remedies made available under that Act.³ The plaintiffs alleged that Yahoo and its co-defendants