[BreachExchange] Three States Join Others to Expand Personal Information Definition to Include Usernames or Email Addresses

[Inga Goddijn]

http://www.jdsupra.com/legalnews/three-states-join-others-to-expand-41483/

A key issue in determining whether notification is required following a
data breach is whether “personal information” (PI) was acquired by an
unauthorized person. US states vary significantly in defining what
information qualifies as PI.[1]
<https://www.morganlewis.com/pubs/three-states-join-others-to-expand-personal-information-definition#_ftn1>
As part of a recent trend, some data breach notification statutes have been
expanding the definition of PI, including by adding usernames and email
addresses. Trend to Add Usernames or Email Addresses

Illinois, Nebraska, and Nevada are the latest to add usernames or email
addresses to the definition of PI when they are combined with information
that would permit access to an online account.[2]
<https://www.morganlewis.com/pubs/three-states-join-others-to-expand-personal-information-definition#_ftn2>
The Illinois law took effect on January 1, 2017, while the respective laws
in Nebraska and Nevada took effect in 2016.

Three other states (California, Florida, and Wyoming) had previously
enacted laws mandating that either a username or email address constitutes
PI when combined with a password or security question and answer that would
permit access to an online account.[3] California first expanded the
definition of PI to include usernames and email addresses in January 2014.
Florida was next in July 2014, and Wyoming followed in July 2015. In most
of these jurisdictions, the username or email address combined with the
password or security question and answer provides an independent basis to
establish PI—even if no first or last name (or other personally
identifiable information) is disclosed.

Given the trend to broaden the scope of PI, private and government entities
that collect usernames, email addresses, passwords, and security questions
and answers should take steps to protect this information.
Other Diverging Standards

Private and government entities should also be aware that different
jurisdictions apply varying standards to the collection of such
information. For example, the Nevada, Rhode Island, and Wyoming definitions
are narrower in that they require at least a last name and first initial to
be disclosed in order for user data to qualify as PI, just as it is for
social security numbers, driver’s license numbers, and most other forms of
PI. In other words, while releasing an unencrypted username and password
would be considered to be PI in California, Florida, Illinois, and Nebraska
even if the last name (and at least a first initial) of the individual
associated with the username was not released, it would not qualify as PI
in Nevada, Rhode Island, or Wyoming without that additional information.

Nevada’s and Rhode Island’s PI definitions are broader in other respects in
terms of what constitutes user data. For example, Nevada and Rhode Island
consider a username, email address, or a “unique identifier” to be PI when
combined with a password, security question and answer, or an “access code”
that would permit access to an online account.[4]
<https://www.morganlewis.com/pubs/three-states-join-others-to-expand-personal-information-definition#_ftn4>
The other states only list usernames and/or email addresses. The
legislative history does not indicate what is considered to be a “unique
identifier,” nor are any examples provided. Because this term is added to
the “email address” and “username” list, it appears that the states
consider this addition to be something more.

Nevada and Rhode Island also added “access code” as data that the username,
email address, or unique identifier may be paired with to qualify as PI.[5]
<https://www.morganlewis.com/pubs/three-states-join-others-to-expand-personal-information-definition#_ftn5>
As with the terms “unique identifier,” the legislative history does not
indicate what is considered to be an “access code,” nor are any examples
provided, but we believe that the states must consider it to be something
beyond a password.

These and other distinctions highlight how common data elements are treated
differently among the data breach notification jurisdictions. Consequently,
depending on the circumstances, data breach notification may be required in
some jurisdictions but not others.

Based on the many variations under the state data breach laws, some have
called for enactment of a uniform federal standard concerning data breach
notification requirements.[6]
<https://www.morganlewis.com/pubs/three-states-join-others-to-expand-personal-information-definition#_ftn6>
Until uniform or common standards are adopted, private and government
entities collecting PI will need to wade through the state-by-state
standards to determine whether data breach notification is mandated under
the given circumstances.
International Perspective

Under European and many other international data privacy laws, PI includes
any information that identifies an individual or from which an individual
can be identified when aggregated with other information. This will include
usernames and email addresses where the individual’s actual name is
included within the username or email address. Under the forthcoming
General Data Protection Regulation (GDPR), which comes into force in May
2018, if a US organization targets European consumers for goods or
services, it will be subject to the GDPR when it processes the PI of such
European consumers—whether or not the organization is based in the European
Union. The requirements under the GDPR include providing information to the
individuals about how their PI will be used, disclosed, and transferred, as
well as requirements to obtain consent for the processing and transfer of
such data to the US (unless an exemption to obtain consent applies). There
is also a requirement to notify the relevant data protection authority of a
data breach involving PI within 72 hours (unless there is unlikely to be a
risk to the individuals’ rights).

Organizations with European businesses, therefore, should note that they
may be subject to the GDPR when obtaining and using PI of European
consumers, even if the US state laws do not place similar requirements on
the organization processing US consumers’ PI. The potential fines for
breaching the GDPR can amount to the higher of €20 million or 4% of global
annual turnover.
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.riskbasedsecurity.com/pipermail/breachexchange/attachments/20170104/fe1c1c0b/attachment.html>