Yahoo offers new proposal to settle massive data breach

Marco Green
April 11, 2019

Yahoo has once again attempted to settle a class-action lawsuit involving millions of users following one of the largest data breaches in history with a revised settlement figure of $117.5 million.

The deal revises an earlier agreement struck last October, only to be rejected by U.S. District Court Judge Lucy Koh in San Jose, California. Lest we forget Yahoo's 2013 breach affected three billion accounts. Now, the proposed settlement includes at least $55 million for victim expenses, $24 million for credit monitoring, up to $30 million for legal fees, and $8.5 million for other expenses, as reported by Reuters.

The breaches, which occurred between 2013-2015, put personal information of all Yahoo users at risk - to the point where every user was encouraged to change their password. Verizon wrote off Yahoo's value in December 2018, and now it's going to have to spend hundreds of millions of dollars as part of this settlement.

Lawyers representing the Yahoo accountholders estimate about 194 million people in USA and Israel will be eligible to make claims, according to court documents.

John Yanchunis, a lawyer for the plaintiffs, in a court filing called the $117.5 million the "biggest common fund ever obtained in a data breach case".

When Verizon acquired Yahoo for $4.48 billion in 2016, in the following year, Yahoo and AOL also formed a new company under Verizon named Oath.

"We believe that the settlement demonstrates our strong commitment to security", a Verizon Media spokesperson told CNN Business. Only later did it reveal the scope of the breaches, prompting a price cut to $4.48bn (£3.42bn). One hacker later pleaded guilty.

High-Tech Bridge CEO, Ilia Kolochenko, argued that the pay-out of around $25 per compromised account amounted to an "embarrassingly modest compensation", although was not unusual in offering more to the attorneys than the victims.

"In 2019, even a less severe breach is capable of exposing your company to incomparably severe and harsh sanctions in different jurisdictions".

Other reports by Click Lancashire

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