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Reports: FTC Can Proceed With Lawsuit Against Hotel Operator for Data Breaches

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cybersecurityThe Third U.S. Circuit Court of Appeals in Philadelphia has voted to uphold the Federal Trade Commission‘s decision to sue Wyndham Worldwide for three data breach incidents in 2008 and 2009, Reuters reported Monday.

Jonathan Stempel writes that the ruling reinforces FTC’s power to regulate cybersecurity practices at corporate establishments and pursue lawsuits against those that fail to secure consumer information.

Circuit Judge Thomas Ambro cited a 1914 law that gives FTC broad authority to protect consumers from unfair or deceptive business practices, the report said.

Stempel reports that the circuit voted 3-0 to allow FTC to move forward with its 2012 lawsuit against Wyndham, which was temporarily shelved after the hotel operator contested the suit.

“It is not only appropriate but critical that the FTC has the ability to take action on behalf of consumers when companies fail to take reasonable steps to secure sensitive consumer information,” said FTC Chair Edith Ramirez, according to the report.

Brent Kendall also reports on the Wall Street Journal that the commission’s action could also fill the legislative void in policing corporate cybersecurity, with at least 50 cases brought against companies with data security issues.

The report said most of these previous cases have resulted in settlements.

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