On April 14, 2021, the United States Department of Labor (the “DOL”) issued for the first time guidance to retirement plan sponsors, fiduciaries, record keepers, service providers and plan participants guidance on cybersecurity issues. The DOL’s press release includes three pieces of guidance, including: (1) Tips for Hiring Service Providers; (2) Cybersecurity Program Best Practices; and (3) Online Security Tips.

The Employee Benefits Security Administration, a sub-agency of the DOL (the “EBSA”) long ago stated that addressing cybersecurity has been on the agency’s “to do” list and even published a report in 2016 reflecting the need for such guidance, which we previously covered here.

The Employee Retirement Income Security Act of 1974, as amended (“ERISA”), includes fiduciary standards that require a retirement plan to be administered in accordance with a standard of care for a prudent person who is familiar with such matters. Common sense dictates that ERISA fiduciaries administer their plans in accordance with industry standards for cybersecurity, safeguard plan assets and ensure that appropriate controls are in place to avoid financial losses to plans that may result from a cybersecurity breach. However, the legal issues concerning who is responsible (plan participant, plan sponsor or record keeper) remain open questions in many jurisdictions.


Continue Reading DOL’s New Cybersecurity Guidance

Information security is critical to the operation of the financial markets and the confidence of its participants. . . The Division is acutely focused on working with firms to identify and address information security risks, including cyber-attack related risk . . .” SEC Division of Examinations, 2021 Examination Priorities, at 24.

On March 3, 2021, the Securities and Exchange Commission’s newly renamed Division of Examinations (EXAMS) (formerly the Office of Compliance Inspections and Examinations (OCIE)) announced its 2021 examination priorities.  Information security and operational resiliency ranked number two out of the top five priorities sending a clear message that the SEC is focused on emergent security threats, particularly cyber-attacks, resulting from the sudden and unprecedented increase in remote operations.


Continue Reading SEC Announces 2021 Information Security Examination Priorities – Five (5) Steps Every Firm Should Take to Prepare!

On March 2, 2021, Governor Northam signed into law Virginia’s own Consumer Data Protection Act (“Virginia CDPA” or the “Act”), a bill that brings together concepts from the EU’s General Data Protection Regulation (GDPR) as well as the California Consumer Privacy Act (CCPA) and the California Privacy Rights Act (CPRA). It is the first of its kind legislation on the East Coast. The law will go into effect on January 1, 2023.

The drafters of the Virginia CDPA appear to have benefited from observing the pitfalls and problems that arose in the development and implementation of both GDPR and CCPA. The Virginia bill deftly avoids several of those by incorporating narrower, more tailored definitions that clearly exclude categories of data and businesses over which there was (and continues to be) some confusion with respect to both the EU/UK and California compliance regimes. It also adopts, in concept, the framework of the GDPR, and even some of its language. Like GDPR, it characterizes the party who initially collects and controls personal data as the “controller” and obligates that party to be a good steward of the data, through transparency with the consumer, accountability for sharing the data with third parties (“processors”), and a duty to implement appropriate data security to safeguard the data. It will be enforced by the Virginia Attorney General. Notably, there is no private right of action under the Act.


Continue Reading Virginia’s New Consumer Data Protection Act (CDPA)

As we discussed in Part I, the United States does not have a single, comprehensive federal law governing biometric data.  However, we have recently seen an increasing number of states focusing on this issue.  Part I summarized legislative activity on this issue in 2020.  In this Part II, we discuss noteworthy legislation to monitor in 2021.

What to Expect in 2021

At least two states—New York and Maryland—have already introduced biometrics legislation in this first month of 2021.

New York – AB 27

On January 6, 2021, the New York Assembly introduced the Biometric Privacy Act (BPA), a New York state biometric law aimed at regulating businesses handling biometric data.  BPA will prohibit businesses from collecting biometric identifiers or information without first receiving informed consent from the individual, prohibit profiting from the data, and will require a publicly available written retention and destruction policy.  As proposed, the statute contains a private right of action; and if passed, it will permit consumers to sue businesses for improperly collecting and using their biometric data.  The statute follows Illinois’s BIPA, allowing recovery of $1,000 per negligent violation and $5,000 per intentional violation, or actual damages, whichever is greater, along with attorney’s fees and costs, and injunctive relief.


Continue Reading U.S. Biometrics Laws Part II: What to Expect in 2021

On January 21, 2021, the Department of Health and Human Services (HHS) published proposed modifications to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Health Information Technology for Economic and Clinical Health Act of 2009 (HITECH).

The proposed rule is part of HHS’ Regulatory Sprint to Coordinated Care, which seeks to promote value-based healthcare by examining federal regulations that impede efforts among healthcare providers and health plans to better coordinate care for patients. Specifically, HHS aims to amend the regulations implemented pursuant to HIPAA and HITECH where the rules present barriers to coordinated care and case management or where they otherwise impose burdens on covered entities that do not increase individuals’ privacy protections.


Continue Reading Department of Health and Human Services Announces Proposed Changes to the HIPAA Privacy Rule

Data privacy laws have made significant breakthroughs in recent years, making it a top priority for businesses.  From the adoption of the European Union’s General Data Protection Regulation (GDPR) in 2016 to the enactment of the California Consumer Privacy Act (CCPA) in 2018 and the latest ballot approval of the California Privacy Rights Act (CPRA) in 2020, we continue to see data privacy laws develop and garner interest from consumers, businesses, and legislators alike.

Specific biometric privacy laws, in particular however, are often overshadowed by more general data privacy laws.  As we discussed in our prior article, biometrics are physical and behavioral human characteristics (i.e., face, eye, fingerprint, and voice features) that can be used to digitally identify a person.  As the collection and use of biometric data become more common in daily life and its applications in different industries continue to expand, new privacy considerations will emerge in this field.  Biometrics laws, in their own right, require separate recognition because of the nuanced application of these specific laws.

The United States does not have a single, comprehensive federal law governing biometric data.  Recently, we have seen an increasing number of individual states focus on this issue, and the recent introduction of legislation in a number of states specifically aimed at protecting the collection, retention, and use of biometric data.  In Part I, we summarize some of the legislative activity on biometric laws from 2020.  We will describe other noteworthy legislation to monitor for 2021 in Part II.


Continue Reading U.S. Biometrics Laws Part I: An Overview of 2020

On November 4, 2020, the Office of the National Coordinator for Health Information Technology (ONC) published an Interim Final Rule with Comment Period (IFC) that delays compliance dates necessary to meet certain requirements related to information blocking initially finalized in the ONC Cures Act Final Rule (Final Rule) in March of 2020. The Final Rule implemented health IT provisions enacted under the 21st Century Cures Act (the Cures Act) to achieve ubiquitous interoperability among health IT systems and to improve patient’s ability to access their electronic health information (EHI). Among these provisions is a prohibition of information blocking. This article will define information blocking, provide and explain exceptions to such practice, detail the IFC’s deadline extensions, and highlight key compliance concerns and solutions regarding these reforms.

Information Blocking

The term “Information Blocking” is broadly defined by the Cures Act as any practice that is likely to interfere with, prevent, or materially discourage access, exchange, or use of EHI when the entity knows (or should know) that it is likely to do so. The Cures Act specifies four types of “actors” that must comply with the information blocking rule:

  1. Healthcare Providers
  2. Health information technology companies that have a certified health IT system
  3. Health information networks (HINs)
  4. Health information exchanges (HIEs)


Continue Reading Information Blocking Compliance: What Providers Need To Know As Deadlines Approach

Data privacy is a top concern for many in-house legal professionals – and for good reason – data privacy and cybersecurity legal requirements are complex and continually evolving. Data Privacy Day is a great day to start addressing your organization’s data privacy and cybersecurity needs.

On Data Privacy Day 2021, here is what is top of mind for some of our Data Privacy & Security Team members:

  • Andrew Konia – A Federal Privacy Law: “Calls (pleas?) for federal privacy legislation are nothing new, and last year we came close, with both parties presenting draft bills for consideration (surprise, neither passed!).  But now, with the White House and both chambers of Congress under Democratic control, there appears to be renewed (and more serious) interest in a federal privacy law. We have seen (admittedly narrow) hints of the federal government taking a stronger stance on cybersecurity standards with the IoT Cybersecurity Improvement Act of 2020, which applies to federal agency purchases. But you take the recent and intense backlash on “Big Tech’s” use/sharing of data and perceived lack of data transparency, and mix in the Biden Administration’s prioritization of consumer protection generally, and you have the recipe – and a strong political appetite – for a comprehensive federal privacy law.”
  • Bethany Lukitsch – California: “CPRA will be here before we know it, and most companies are going to have a lot to do to get ready. Updating privacy policies and adding ‘do-not-share’ links are one thing, but as with CCPA, it’s the behind-the-scenes work that is really going to take some time.  It’s certainly not too early to get started.”


Continue Reading Data Privacy Day 2021: Privacy and Cybersecurity Are On Our Minds, Too

Healthcare providers and other covered entities are not required by HIPAA regulations to have “bulletproof” protections for safeguarding patient information stored in electronic form, according to a January 14, 2021 decision of the 5th U.S. Circuit Court of Appeals. In University of Texas M.D. Anderson v. U.S. Department of Health and Human Services, the 5th Circuit vacated a $4.3 million civil monetary penalty imposed by the U.S. Department of Health and Human Services (HHS) against the University of Texas’ M.D. Anderson Cancer Center.

The case arises from three separate incidents where M.D. Anderson employees lost laptops and USB thumb drives that contained unencrypted protected health information (PHI) for more than 34,000 patients. M.D. Anderson reported the breach incidents to HHS’ Office for Civil Rights (OCR), the office tasked with enforcing HIPAA. As a result of the reported breaches, OCR ordered M.D. Anderson to pay $4.3 million in civil monetary penalties (CMPs). M.D. Anderson appealed the decision to an HHS administrative law judge and to the HHS Departmental Appeals Board (DAB), both of which upheld OCR’s penalties. M.D. Anderson argued that the HIPAA regulations do not require encryption, that it complied with the regulations and employed other effective measures to safeguard electronic protected health information (ePHI), that the three incidents were the fault of staff who violated M.D. Anderson’s policies, and that the proposed CMPs were excessive.


Continue Reading 5th Circuit Weakens HHS’ Ability to Enforce HIPAA Safeguards

The end of the Brexit transition period on 31 December 2020 means the UK now has full autonomy over its data protection policies. As of 1 January 2021 the UK is recognised as a ‘third country’ under EU General Data Protection Regulation (GDPR) rules. The EU-UK Trade and Cooperation Agreement, which is an agreement in principle between the EU and UK, does not yet include a provision for the vast flow of personal data being transferred between the two jurisdictions. The transfer of personal data will be subject to a separate adequacy decision from the EU due in early 2021. This separate adequacy decision will determine whether the EU will allow the ongoing free flow of data from EU/EEA countries to the UK. If an adequacy decision is not granted, then organizations who transfer personal data from the EU/EEA to the UK will have to take additional steps to ensure data being transferred is provided equivalent protections to those under the EEA. The UK has already determined that it considers all EEA/ EU states to be adequate which means that personal data flows from the UK to the EU/EEA will remain unaffected.

Continue Reading The Status of EU–UK Data Flows Following Brexit