Home Depot is seeking to combine a consumer class action lawsuit over its recent data breach with a case filed by banks looking to recoup breach-related costs. The lead bank plaintiff, First Choice Federal Credit Union, opposed the request.
Home Depot asserted in a recent filing that the plaintiffs’ objection “rests upon a fundamental misunderstanding of the standard for assessing whether cases are related.” The consumer plaintiff case is Solak v. Home Depot, currently pending before the same Georgia federal district court.
The retailer added, “This Court does not require perfect identity of the issues, arguments, and defenses. Rather, two cases are related as long as they involve the same facts and/or arise out of the same transaction or occurrence.”
FCFCU had stated in a filing, “Each suit involves a wholly different type of plaintiff, seeks different damages and is based on different legal theories and they do not involve the same ‘issues, arguments, and defenses.’ Indeed, Home Depot also has implicitly recognized the many distinctions between the Solak matter and this matter by retaining separate counsel for the two actions.”
The plaintiff states that consumers are pursuing recovery based on their perceived increased risk of identity theft after personal and financial information was inappropriately accessed. Several courts have found that mere risk of identity theft does not allow recovery from a breached entity.
On the other side, FCFCU said, banks pursue recovery based on “completely separate and tangible harms such as the losses incurred in reissuing payment cards, reimbursing fraudulent charges, lost interest and transaction fees, and other costs incurred protecting its cardholding customers.”
The relationship between banks and retailers differs and the legal arguments depend on different claims of negligence and negligent misrepresentation. Home Depot stated in its response that the facts relating to the incident and its conduct before, during, and after the breach are the same for both cases and should be consolidated.
Erin is the managing editor of Advisen’s Front Page News. She has been covering property-casualty insurance since 2000. Previously, Erin served as editor-in-chief of The Standard, New England’s Insurance Weekly. Erin is based in Boston, Mass. Contact Erin at [email protected].
