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Data Breach Investigation | Constitutionality | Arbitrary, Capricious?

Posted on September 22, 2010 by Dissent

Benjamin Wright is an attorney who teaches e-discovery, data security and cyber investigations law at the SANS Institute. In commenting on the recent matter of Lucile Salter Packard Hospital being fined for not notifying patients within 5 days of confirming that PHI were on a stolen computer, Wright states:

Yet I will say that it is irresponsible for data holders to issue breach notices before they have concluded a true breach has occurred. Unnecessary notices inflict angst and confusion on data subjects. A mere security vulnerability is not a breach.

To distinguish between a vulnerability and a breach often requires deliberation. Deliberation can require painstaking collection of facts, coordination with multiple parties such as law enforcement and careful review of the facts, often with input from multiple learned parties, such as outside experts.

Although I understand his point, the definition of what constitutes a reportable breach (as opposed to a vulnerability) would be seem to be defined by the state’s statute. If a breach is defined as “unauthorized acquisition of computerized data that compromises the security, confidentiality, or integrity of personal information maintained by the person or business” then the theft of equipment containing such information would seem to this non-lawyer to constitute a breach, not a vulnerability.

He continues:

The California Legislature made clear it wants notices to be issued quickly. However, the law should not be interpreted to require rash decision-making. If the law is interpreted as a hair-trigger requirement for notices before a competent investigation can be concluded, then I question the constitutionality of the law. That interpretation would render the law arbitrary, capricious, unreasonable, in conflict with the need for due process under the US Constitution.

Well, now I’m totally confused, as I thought states could regulate businesses and set rules and deadlines — and consequences under its authority. If a state decides that it’s in the interests of its residents that they be notified within 5 days if an entity has determined that their personal information has been stolen — even if the information is subsequently recovered — then where’s the constitutional issue?

I would love to see him expand his argument because although I have previously expressed my own reservations about the 5-day deadline, my concern was not a constitutional one per se.

You can read his entire column on IT Policy | Audit | Investigate Cyber Crime

The hospital has appealed the fine.

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