In December 2022, a significant data breach impacted the lives of thousands of customers associated with CGM, a service solutions company.
The breach compromised sensitive personal information, including driving license or state ID numbers and social security numbers, exposing approximately 279,063 people to potential identity theft and fraud.
Now, nearly a year later, a $1.5 million settlement has been reached, offering affected individuals a chance to claim compensation for the damages they have suffered.
The Settlement: A Brief Overview
The settlement, though not an admission of guilt from CGM, is a resolution to the class action lawsuit filed against the company.
The lawsuit alleged that CGM failed to implement industry-standard data security measures and did not adequately train its employees on cybersecurity protocols, resulting in the breach.
While the company has denied any wrongdoing, the settlement offers a form of restitution to those affected by the breach.
Eligible claimants stand to receive up to $4,400 in compensation, depending on the extent of their losses.
This settlement also includes additional benefits, such as three years of three-bureau credit monitoring and up to $1 million in identity theft protection.
These measures aim to provide some peace of mind to those who have had their personal information exposed.
Who is Eligible for Compensation?
If you were impacted by the breach, you should have received a notification from CGM informing you of your eligibility to participate in the settlement.
To claim your share, you will need to provide proof of the losses you incurred due to the data breach.
This proof can take various forms, including invoices, account statements, credit reports, or insurance claims.
For ordinary losses, claimants can receive up to $400, with an additional $20 per hour for up to four hours of lost time.
If you suffered extraordinary losses—such as significant financial harm or identity theft—you could receive up to $4,000. However, for those who cannot provide documentation of their losses, a smaller cash payment, estimated to be around $20, is available.
The final amount each person receives may vary depending on the number of claims filed.
Understanding Class Action Lawsuits
To fully grasp the significance of this settlement, it’s important to understand what a class action lawsuit entails.
Class actions are legal proceedings that allow a group of individuals with similar grievances to sue a defendant collectively.
In this case, the class action was brought against CGM by a group of people who believed the company had failed to protect their personal information adequately.
When a lawsuit becomes a class action, it extends to all individuals who fall under the “class” defined in the suit.
This means that if you were impacted by the breach and meet the criteria, you are automatically included in the settlement unless you choose to opt out.
By accepting the settlement, class members typically waive their right to pursue further legal action against the company regarding the same issue.
Settlements are common in class actions, as they allow companies to avoid the costs and uncertainties of prolonged litigation.
These agreements often include a payout to class members, coupled with a statement from the defendant denying any wrongdoing. This is precisely what happened in the CGM case.
Important Deadlines and Next Steps
If you are eligible to receive compensation from the CGM settlement, it is crucial to act quickly. The deadline to file a claim is August 26, 2024, giving class members only a few hours left to submit their claim forms.
Failure to do so will result in forfeiting your right to compensation and prevent you from taking any future legal action against CGM concerning this data breach.
Additionally, a final approval hearing is scheduled for later today. This hearing will determine whether the settlement is fair and adequate. If approved, payments will be distributed to claimants shortly afterward.
It’s also worth noting that CGM is not the only company involved in data breach settlements. For example, some Americans are eligible for a $6,000 payout from a $2.7 million settlement with a dental company.
These settlements highlight the growing issue of data breaches and the importance of companies implementing robust cybersecurity measures to protect their customers’ information.