Florida Information Protection Act of 2014 - Florida Means Business When It Comes to Protecting Customers' Personal Information

by Akerman LLP
Contact

On June 20, 2014, Governor Rick Scott signed into law the Florida Information Protection Act of 2014 ("FIPA"), which became effective July 1, 2014. FIPA expands the obligations of businesses and government entities that maintain data containing personal information of individuals to safeguard and provide notice of breaches of such information. As a result, Florida now has one of, if not the most strict breach notification statutes in the country.

The Act repeals § 817.5681, Florida Statutes, Florida’s existing breach notification statute, and creates within Chapter 501, Consumer Protection, new statute § 501.171, Florida Statutes. While some of the language of § 817.5681 remains in the new law, FIPA makes significant changes as described below:

  • FIPA expands the definition of "personal information" to include a person's first name or first initial and last name in combination with such person’s health insurance information, medical information or financial account information, and now also includes a person’s online account credentials.
  • Thirty (30) day notice by covered entities to consumers after discovery of a breach or the belief that a breach occurred. Previously, businesses had up to forty-five (45) days to provide notice to affected individuals, unless, after appropriate investigation or consultation with relevant law enforcement agencies, the entity determines that the breach will not likely result in identity theft or other financial harm to any individuals. Third party agents of covered entities that have a breach must notify the covered entity no later than ten (10) days following discovery of the breach.
  • In the event of a breach affecting 500 or more Florida residents, covered entities must provide notice to the Florida Department of Legal Affairs within thirty (30) days of the discovery of a breach or the belief that a breach occurred, even if the covered entity determines that a breach is not likely to result in identity theft or other financial harm to individuals. Covered entities must provide a copy of their breach policies if requested by the Department.
  • Businesses and state government entities must take reasonable measures to protect data in electronic form, such as encrypting data or de-identifying the data. They must also dispose of records in a way that protects consumer information from being disclosed, such as shredding, erasing, or otherwise modifying the personal information in the records to make it unreadable or undecipherable through any means.
  • Entities that maintain, store, or process personal information on behalf of a covered entity or governmental entity must notify a covered entity of a breach of security no later than ten (10) days after discovering a breach or a suspected breach.
  • Violations of FIPA will be treated as unfair or deceptive trade practices.
  • In addition to the remedies provided under the Florida Unfair and Deceptive Trade Practice Act, a covered entity that fails to provide notice of a breach is liable for a civil penalty for each breach of up to $1,000 per day for the first 30 days, and $50,000 for each subsequent 30-day period for up to 180 days. State governmental entities and their instrumentalities are not liable for these civil penalties for failing to timely report security breaches but are subject to notification requirements.

While the Act specifically states that it does not create a private cause of action for those affected by a breach, that does not mean there is no risk of litigation in the event of a security breach. The plaintiffs' bar is using common law theories such as negligence, breach of contract, unjust enrichment and restitution, and breach of fiduciary duty to sue for damages caused by data breaches.

What does this mean for health care entities?

In some ways, the language of § 501.171, Florida Statutes, parallels the Health Insurance Portability and Accountability Act of 1996 ("HIPAA") and its implementing regulations. For example, the threshold of 500 individuals being affected to trigger reporting to the Department of Legal Affairs is similar to the 500 individual threshold for sixty (60) day reporting on the Department of Health and Human Services breach website. Similarly, HIPAA covered entities, business associates, and subcontractors should already be familiar with the concepts of appropriately encrypting personal information and de-identifying personal information as "safe harbors" from enforcement activity.

However, there is ambiguity in FIPA as the act relates to entities that are subject to federal laws requiring breach notification. Currently, HIPAA provides covered entities up to 60 days to notify individuals of a health information breach and provides that covered entities may be able to avoid sending notice if they demonstrate that it is unlikely that the information has been compromised. Under FIPA, to avoid notifying a patient, a health entity would first have to consult with law enforcement. There could be situations where FIPA may require notice but HIPAA does not, based on the covered entity's assessment that there is a low probability that patient information was compromised.

Also, FIPA states that if a covered entity complies with the breach notification rules and regulations of its primary or functional federal regulator, i.e., HIPAA, the covered entity is deemed to have complied with the notice requirements of FIPA. However, this contradicts the requirements under FIPA that covered entities must timely provide notice of the breach to the Department of Legal Affairs, i.e., within thirty (30) days of discovery of the breach or suspected breach. As implementation progresses, some of these ambiguities will be sorted out.

What does this mean for non-health care businesses?

This change does not just affect Florida healthcare-related businesses, but any business storing the information of Florida residents. All businesses doing business with Florida residents will be subject to the new, more stringent notification requirements in FIPA, and any business with a breach response plan will need to re-assess its internal compliance to make sure that it is capable of meeting the new, shortened response times required by FIPA.

What should entities conducting business with Florida customers do to comply with FIPA?

  • Evaluate your current policies and security measures for electronic personal information and update them as necessary;
  • Develop new policies or update existing policies for identifying breaches and providing appropriate notification to affected individuals.
  • Ensure that your company is using proper methods to destroy or dispose of personal information;
  • Review and update your agreements with third party agents who maintain or transmit electronic personal information to address the new requirements of § 501.171, Florida Statutes, regarding notification of breaches suffered by the third party agent and what precautions the third party agent takes to safeguard and properly destroy data.
  • Review your liability policies to determine what coverage is available in the event of a breach. The cost to respond to a data breach continues to climb, and some insurers are revising their CGL policies to exclude coverage for data breaches. Separate cyber liability policies are available in the marketplace.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Akerman LLP | Attorney Advertising

Written by:

Akerman LLP
Contact
more
less

Akerman LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
Feedback? Tell us what you think of the new jdsupra.com!