Legal Steps to Take When Facing a Cybersecurity Breach in Your Business

Cybersecurity breaches can pose a significant threat to businesses, leading to financial loss, reputational damage, and legal consequences.

Businesses should have a clear understanding of the legal steps they should take when facing a potential cybersecurity incident. 

At Duwel Law located in Dayton, Ohio, our attorneys have outlined the essential legal actions businesses should consider following a cybersecurity breach.

Step 1: Take Immediate Response Actions

When responding to a cybersecurity breach, it's essential to first assess the scope and nature of the incident. This typically involves:

• Identifying the type of breach: Understanding the specific type of breach can help tailor your response and recovery efforts effectively.

• Determining the systems affected and the data compromised: This analysis is critical for understanding the potential impact on business operations and customer trust.

• Establishing the timeline of the breach: A clear timeline will assist in documenting the incident for legal and regulatory purposes, as well as for internal review.

Contain the Breach

Once you understand the breach, the next step is to contain it. Some ways to contain a cybersecurity breach may involve the following:

• Disconnecting affected systems from the network: This immediate action helps prevent further unauthorized access and minimizes the risk of data exfiltration.

• Implementing emergency security measures: These measures are crucial for sealing vulnerabilities and protecting sensitive information from being exploited.

• Consulting IT professionals or cybersecurity professionals: IT professionals' experience can provide valuable insights into the breach's nature and guide the implementation of effective containment strategies.

Notify Key Internal Stakeholders

Once the breach has been identified, it's essential to keep all key internal stakeholders informed throughout the resolution process. This may include:

• Executive leadership: Keeping them updated helps make sure that strategic decisions can be made quickly and resources are allocated effectively for response efforts.

• Legal counsel: Their involvement is crucial to understand compliance issues and potential legal liabilities that may arise from the breach.

• IT and cybersecurity teams: Making sure they're informed allows for coordinated efforts in investigating the breach and implementing necessary technical safeguards.

Step 2: Engage Legal Counsel

Engaging an attorney experienced in cybersecurity and privacy law is critical. They can guide your business through the intricacies of legal compliance, liability issues, and regulatory requirements. Ohio businesses should consider firms experienced in data protection laws, incident response strategies, and regulatory compliance.

Understand Your Legal Obligations

In Ohio, businesses should understand their legal obligations in the event of a cybersecurity breach, including:

• Data breach notification laws: Ohio law requires that businesses notify affected individuals and the Ohio Attorney General if personal data is compromised. This includes specific timelines and methods for notification.

• Federal laws: Depending on the nature of the data involved, federal laws such as HIPAA (for healthcare information) or GLBA (for financial information) may also apply.

Step 3: Notify Affected Individ

Ohio’s data breach notification law requires businesses to notify affected individuals in the event of a breach involving personal information. Some of the key points include:

• Timing: Notifications should be made without unreasonable delay, generally within 45 days of discovering the breach.

• Content: Notifications must include details about the nature of the breach, the types of personal information involved, and steps individuals can take to protect themselves.

Notify the Ohio Attorney General

In addition to notifying affected individuals, Ohio businesses must report data breaches to the Ohio Attorney General. This notification should include:

• The number of affected individuals

• A description of the breach

• Measures taken to mitigate harm

Consider Additional Notifications

Depending on the nature of the breach, additional notifications may be necessary, including:

• Credit reporting agencies (if sensitive personal information is involved)

• Regulatory bodies or industry-specific organizations

Step 4: Investigate the Breach

Following a breach, conducting a comprehensive investigation is essential. This should include:

• Engaging cybersecurity professionals to analyze the breach: Their skills can uncover the root cause and provide recommendations for remediation to prevent future incidents.

• Documenting findings and establishing a timeline: This record serves as an essential reference for internal reviews and may be required for regulatory compliance or legal proceedings.

• Identifying vulnerabilities that led to the breach: Understanding these weaknesses is critical for implementing targeted improvements to your cybersecurity posture and reducing the risk of recurrence.

Preserve Evidence

Preserving evidence is crucial for any potential legal actions or regulatory inquiries. Make sure that all relevant data, logs, and communications are secured and stored in a way that maintains their integrity.

Step 5: Legal Compliance and Risk Management

After a breach, review any contracts with third parties that may be implicated in the breach. This may include service level agreements (SLAs), data processing agreements, and insurance policies.

• Assess liability and potential claims: Determine potential liability arising from the breach, including claims from affected individuals (e.g., for identity theft), regulatory fines or penalties, and civil litigation from customers or partners.

• Implement risk mitigation strategies: To prevent future breaches, consider implementing risk mitigation strategies, such as enhanced cybersecurity training for employees, regular security audits and vulnerability assessments, and revising data protection policies and procedures.

Step 6: Regulatory Compliance

Ohio businesses must comply with various federal and state regulations, including:

• Ohio Data Protection Act: Encourages businesses to implement cybersecurity measures and provides a safe harbor for those that do.

• Federal Regulations: Depending on the industry, regulations such as HIPAA, FERPA, or PCI-DSS may apply.

Prepare for Regulatory Investigations

Be prepared for potential investigations from regulatory bodies. This may involve providing documentation and evidence related to the breach and cooperating with investigators.

Engage With Law Enforcement

In cases of significant breaches, it may be necessary to report the incident to law enforcement. This can assist in criminal investigations and potentially mitigate future risks.

Step 7: Public Relations and Communication

A robust communication plan is essential for managing the aftermath of a breach. Consider who will be the spokesperson for the company, the key messages to communicate to stakeholders, employees, and customers, and the strategies you will use for media inquiries.

Effective communication can help mitigate reputational damage. Address concerns transparently and outline steps being taken to rectify the situation and prevent future incidents.

Step 8: Review and Update Your Policies

Following a breach, businesses should evaluate and update their cybersecurity policies and practices. This includes reviewing incident response plans, making sure your policies reflect current best practices and compliance requirements, and involving key stakeholders in the policy revision process.

Conduct Training and Awareness Programs

Implement training programs for employees on cybersecurity best practices, including recognizing phishing attempts, safeguarding sensitive information, and reporting potential suspicious activities.

Insurance Considerations

Businesses should review their cyber insurance policies to understand coverage related to data breaches. Some of the key aspects you should consider include coverage for notification costs, liability coverage for data breaches, and business interruption coverage.

Engage With Insurance Providers

Communicate with your insurance provider about the breach. They can provide guidance on filing claims and may assist with incident response efforts.

Continuous Improvement

After addressing the breach, conduct a post-incident review to identify lessons learned. Consider what went well during the response, areas for improvement in your incident response plan, and the steps to enhance your overall cybersecurity posture.

It's also important to commit to ongoing cybersecurity improvements, including regular audits and assessments, staying informed about emerging threats and best practices, and engaging in industry collaboration and information sharing.

Facing a cybersecurity breach can be overwhelming, but understanding and executing the appropriate legal steps is essential for mitigating risks and protecting your business. In Ohio, businesses must work through specific legal obligations related to data breaches, engage experienced legal counsel, and implement comprehensive incident response plans.

Speak to a Business Law Attorney Today

If you're facing a cybersecurity breach at your business, it's in your best interest to speak to a business law attorney. At Duwel Law, we serve clients throughout Dayton, Ohio as well as Montgomery County, Miami County, Greene County, Darke County, and Warren County. Reach out to Duwel Law today to schedule a consultation.