Retailers Try To Plug Leaks, Limit Liability

Mar 05, 2004
George Anderson

By George Anderson

Companies on the Internet need to be on guard around-the-clock against viruses,
computer hackers and other potential threats to their business.

According to a Washington Post report, some companies have concluded
they simply cannot guarantee their system’s security or consumers’ personal
information. Some have begun requiring customers to waive their right to sue
should personal information be stolen.

The Verizon Wireless Web site includes this clause: “You agree to assume all
risk and liability arising from your use of Verizon Wireless’s online services,
including the risk of breach in the security.”

The company’s general counsel, Steven Tugentman, says Verizon Wireless isn’t
seeking to shirk its responsibilities to its customers. “Verizon Wireless is
very concerned with customer security and privacy. But we are trying to be fiscally
responsible to protect the company from lawsuits.”

Legal experts do not expect the waivers to hold up in court. Chris Jay Hoofnagle,
associate director of the Electronic Privacy Information Center said, “If companies
are willing to derive the benefit of information collection, but not the responsibility
to secure it . . . it won’t be difficult for consumer attorneys to invalidate
these provisions as being unfair.”

Moderator’s Comment:
Should businesses online be legally (financially)
responsible for protecting consumer information records?

We know of signs in a parking garage saying it does not
accept responsibility for our auto’s safekeeping don’t mean a thing legally.
These online waivers won’t either. If you’re willing to benefit from the transaction,
then you also accept the potential downsides.

Anderson – Moderator

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