Document Type
Article
Abstract
A theory of harm frequently asserted in data breach class actions is that plaintiffs did not receive the “benefit of the bargain” with defendants. That is, plaintiffs claim that when they transferred sensitive information to defendants, they anticipated that the information would remain safe. When the data were exposed as part of a breach, that “bargain” was not upheld. For example, Anthem plaintiffs alleged that when purchasing health insurance, they suffered “loss of the benefit of the bargain with Defendants to provide adequate and reasonable data security” and instead received health insurance that was “less valuable than described in their contracts.” Similar theories have been alleged in a variety of data privacy class actions. For example, in breach cases: (i) P.F. Chang’s plaintiffs claimed damages on “the cost of their meals” because they “would not have dined at P.F. Chang’s had they known of its poor data security,” and (ii) Neiman Marcus plaintiffs argued they overpaid because “the store failed to invest in an adequate security system.”
Methods to analyze benefit of the bargain harm in a class certification setting have continued to evolve. For example, while P.F. Chang’s and Neiman Marcus plaintiffs did not propose any specific analytical framework for assessing this theory, Anthem plaintiffs suggested that they would use a statistical technique called “conjoint analysis” to do so.
Recommended Citation
Mike Kheyfets,
Benefit of the But-For Bargain: Assessing Economic Tools for Data Privacy Litigation,
23 J. Tech. L. & Pol'y
(2018).
Available at: https://scholarship.law.ufl.edu/jtlp/vol23/iss1/3