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ARTICLE · 27 JANUARY 2023

Privacy, Cybersecurity And M&A Transactions – A Cautionary Tale

Borden Ladner Gervais LLP
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The U.S. Federal Trade Commission's 2022 privacy and data security enforcement action regarding the CafePress online retail platform resulted in orders against both parties...

CanadaPrivacy
Bradley Freedman
Bradley Freedman
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The U.S. Federal Trade Commission's 2022 privacy and data security enforcement action regarding the CafePress online retail platform resulted in orders against both parties to a 2020 transaction for the sale of the CafePress business and assets. The enforcement action is a cautionary tale for parties to M&A transactions.

The data breach and the transaction

CafePress is a popular online platform that allows consumers to purchase officially licensed merchandise and stock and user-customized on-demand products (e.g., clothing, accessories, drinkware and stationary) from virtual shopkeepers. CafePress was valued at approximately USD$25 million in 2018.

In February 2019, a hacker exploited security vulnerabilities in CafePress' information technology system to access and exfiltrate the personal information of consumers and shopkeepers, including more than twenty million unencrypted email addresses, millions of unencrypted names, physical addresses and

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