Judge Rules Users Can Sue Company Over Hack

Marissa Mayer

Former Yahoo! CEO Marissa Mayer. Brian Ach Getty Images for TechCrunch

Yahoo customers affected by three massive data breaches that resulted in the theft of more than three billion users' data are allowed to sue the company, a judge has ruled.

U.S. District Court Judge Lucy Koh did not accept Verizon's reasoning, instead noting the plaintiffs' allegation that had Yahoo "disclosed the security weaknesses", they would have acted differently toward their data on the site. Yahoo! would eventually fess up to the breach in 2016, but only after it had already agreed to an acquisition deal with Verizon that would lump Yahoo! in with Aol as part of a new company called "Oath".

Koh said that customers may have "taken measures to protect themselves" had they known about the breaches sooner.

Among the suits were claims alleging negligence and breach of contract.

"(Yahoo) also criticize plaintiffs for continuing to use Yahoo Mail and taking no remedial actions after learning of defendants' allegedly inadequate security", Koh wrote.

In total, Koh opted grant six of Yahoo!

Yahoo's parent company, Verizon Communications, had attempted to have many claims thrown out, saying that company was the target of "relentless criminal attacks", Reuters first reported.

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The data hack is the largest in history.

While Yahoo initially reported one billion users were exposed by one hack and 500 million exposed by another, the company revised its figures past year and disclosed that three billion users in total were put at risk as a result of the hacks.

Numerous plaintiffs claim they would have behaved differently had they known in 2013 that their private information had been compromised.

USA prosecutors have charged four individuals - two Russian intelligence agents and two hackers - in connection with the data breach. They say Yahoo's failure to promptly disclose the depth and breadth of the hack created direct financial harm.

In her 48-page decision (PDF), Koh found that while parts of the complaint stood up to scrutiny, plaintiffs will have to show they actually suffered damages or losses.

Karim Baratov, a Canadian national hired by the Russian government to perform various hacks, pleaded guilty last November to various computer hacking and conspiracy charges.

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