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The much publicized lawsuits against Target arising from hacked breaches into its consumer credit and debit cards records is only the face of a rising trend of data protection lawsuits. Website liability today is no longer limited to what is on your website. It also includes the private data not publicly available.

Have you wondered how a spammer obtained your email address? Often it is the result of a website being hacked and email addresses stolen. That type of activity is now leading to lawsuits against website owners by consumers who rightfully demand that their personal information be protected.

The legal question that arises is - was the website negligent in maintaining, storing, and protecting private data?

When a hack occurs, no matter how sophisticated, the answer is likely to almost always be yes. It practical effect this is not a "negligence" standard but one of strict liability. If your website is hacked assume you face liability if private user information was compromised.

How to Protect Yourself

To protect yourself you can obtain business insurance. Make sure it is specialty insurance that covers this type of incident. If necessary, have an attorney review the policy. After a claim arises many businesses are shocked to learn the exclusions in their policy make it practically illusory.