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Professional Liability Blog

We explore and analyze current issues and relevant topics to help accountants, attorneys, architects and engineers, insurance agents and real estate brokers avoid a professional liability case.

Professional Liability Blog
December 26, 2016

Corporate Boards Need to Think About Cybersecurity

It seems like we can’t go a week without hearing about a cybersecurity breach at a major US corporation. Corporate boards need to be aware that improper oversight of cybersecurity issues could lead to a shareholder derivative lawsuit. One such example from within the last couple of years is Palkon v. Holmes, 2014 WL 5341880, at *1 (D.N.J. Oct. 20, 2014) (No. 2:14-CV-01234 SRC). Palkon involved the global hotel operator Wyndham, which between April 2008 and January 2010 was subject to three cyber-attacks, each resulting in a loss of customer data.