Last winter, following a well-publicized data breach, a group of
financial institutions sued Target, arguing that Target should be
held responsible for the damages that they had experienced as a
result of the data breach despite the fact such damage only
occurred indirectly through their individual cardholders. As
discussed in
this previous post, the financial institutions were able to
survive a motion to dismiss from Target using this novel argument.
In a new development, another victory was handed to the banks on
Tuesday – Target and Visa have announced that they have
agreed to settle the claims of Visa's major card issuers for up
to $67 million dollars.
This deal is significant in a number of ways, not the least of
which is its size – $67 million represents a significant
settlement amount for a single data security suit. When combined
with the novelty of the claims made by the financial institutions,
it's likely that this deal will set a precedent for future
