It was inevitable. Heretofore, a majority of public companies that experienced a cyber breach, followed by a shareholder suit alleging either a violation of Section 10(b) of the Securities Exchange Act of 1934 or a breach of the company’s directors and/or officers fiduciary duties, either prevailed on their motions to dismiss, leaving their shareholders with no economic or corporate governance recourse, or settled for what some might consider a relatively nominal sum.
For example, shareholders have been unsuccessful in prosecuting such claims in cases involving TJ Maxx, Heartland Payment Systems and Wyndham, wherein the courts, for various reasons, all dismissed ...