The U.S. Federal Trade Commission (“FTC”) is the federal agency that is charged with enforcing laws to protect consumers from fraudulent, deceptive, and unfair business practices. Over the past several years, one of the FTC’s focuses has been on companies with allegedly deficient cybersecurity protections. On August 24, the Third Circuit confirmed the FTC’s authority to rule that substandard cybersecurity practices are “unfair” to consumers, in FTC v. Wyndham Worldwide Corporation. This decision also made clear that, as a result of FTC’s general actions in the security realm, companies can be deemed to have “fair notice” that their cybersecurity practices could be challenged by the FTC.
Please see our client alert for a more detailed discussed of this decision and its impact on companies handling consumer data. Squire Patton Boggs attorney Deborah Lodge can be contacted for more information.