On Monday, the court in Hapka v. CareCentrix, Inc. ruled that employees of CareCentrix whose personal information was compromised have alleged enough harm for standing under Spokeo, Inc. v. Robins.

In early 2016, a phishing attack compromised defendant CareCentrix’s systems, revealing personal information of up to two thousand employees. CareCentrix notified the plaintiff of the data breach on March 27, 2016, and on April 18, the plaintiff received a letter from the IRS stating that someone had filed a fraudulent tax return in her name.

Denying the defendant’s motion to dismiss, the court emphasized “one key fact”: because the named plaintiff’s personal information had been fraudulently used to file a false tax return, the plaintiff had suffered some form of actual, concrete injury.  Notably, the court rejected the defendant’s attempt to critique each of the plaintiff’s claims individually for being too speculative. The fact that her stolen information had already been used had “a direct impact on the plausibility of future harm” for standing purposes, even in light of the bar for standing outlined in Spokeo.

The court also ruled that the plaintiff had adequately pleaded the elements of a negligence claim, alleging that defendant had failed to implement reasonable data security measures to protect employees’ personal information from disclosure.

Ted Karch is the author of this article.