“…class-action claims will be brought against hotels. These are particularly problematic because while the actual damages may be low, the cost of settling is very high…”
…basis for a claim can be negligence—hotel guests can argue that even when a hotel did not overstep its promises, it is liable to a guest for negligence by not taking adequate steps to protect information. That is going to be even more important as state and federal governments pass laws and adopt regulations that require companies to take affirmative steps to safeguard personal information; these laws and regulations will form a road map for potential plaintiffs.
as we see larger and larger breaches (such as the recently announced Wyndham breach), it’s likely that class-action claims will be brought against hotels. These are particularly problematic because while the actual damages may be low, the cost of settling is very high. Second, governmental agencies—particularly states’ attorneys general and the Federal Trade Commission—are increasingly active in monitoring and investigating breaches. Even where no damages are incurred, responding to investigations is a costly, time-consuming process. I am currently working on a response to an informal FTC investigation that recently topped 1,000 pages—and we’re about half way through.
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