Financial Institutions' Data Breach Class Action Bounced

I've previously blogged about a new breed of data breach class actions filed by financial institutions against retailers (as opposed to customers suing retailers). In these cases, financial institutions claim that retailers should be liable for their costs associated with fraudulent charges, reissuance of new cards, notifying their customers and investigating alleged fraud from data breaches.  Probably the most well-known lawsuit was against Target, which the federal court allowed to proceed past the motion to dismiss and Target settled for approximately $40 million.

Financial institutions were recently dealt a setback.  A federal court dismissed the lawsuit against Schnucks arising from its 2013 data breach affecting as many as 2.4 million cardholders.  The financial institutions (issuing banks in this case) alleged that Schnucks stored credit card numbers in an unencrypted format on its computers and if it had followed industry security standards (i.e. the PCI