Target faces class-action over breach

It’s official – Target Corp. will face a class action lawsuit related to its November 2013 data breach.



A federal judge in Minnesota has granted class action status to a suit brought by five financial institutions – Umpqua Bank, Mutual Bank, Village Bank, CSE Federal Credit Union and First Federal Savings of Lorain.



While Target has not yet been found liable to the financial institutions, the class action status means other institutions can join the proceedings. Target has already negotiated a settlement with issuers of Visa cards that may cost the retailer up to $67 million, but had a proposed $19 million settlement with MasterCard issuers rejected. Those issuers could now join this class action.



“What Target suggests is that, because there was no requirement to act, financial institutions should have done nothing in the face of dire alerts regarding the data breach issued by the card-issuing companies and by Target itself and the known potential consequences for the institutions’ customers,” U.S. District Court Judge Paul A Magnuson wrote in his decision. “The absurdity of this suggestion is evident from the fact that Target itself reissued all of its RedCards, both debit and credit, in the weeks after the breach. Whether a specific action was legally mandated is not required to establish injury or causation.”



In a 10-Q filing with the Securities and Exchange Commission (SEC), Target estimated it had incurred $168 million in liabilities and was eligible for $55 million in insurance reimbursements (as of August 1, 2015).