A law firm funder has predicted a “significant increase” in the amount of internet-related group litigation and is ramping up its support for law firms pursuing it.
Doorway Capital – which owns national law firm Simpson Millar – said the explosion of cyber technology and the internet presented new risks and liabilities.
These included first and third-party claims arising out of tech service and supply contracts, data breaches, the unauthorised disclosure of personal information, business interruption and loss from network issues, loss of digital assets, and internet media liability.
Steve Din, founder of Doorway Capital, said: “The very fact that members of Gen Alpha consider the internet and smart phones as an integral part of their lives, and not merely the tool Millennials consider it to be, means that not only will the incidence of litigation for data breach very likely to soar over the next five years so will quantum of loss sought to be recovered.”
Gen Alpha is a relatively new term coined to represent the children of Millennials.
Doorway is backing both Simpson Millar and Leeds firm Hayes Connor in developing their group action practices in this area.
Hayes Connor has already started actions seeking damages against companies like Ticketmaster, British Airways, Equifax and Dixons for negligently allowing confidential personal data to have been shared amongst third parties – just today, BA was fined £183m by the Information Commissioner’s Office for the breach, using its powers under GDPR.
Kingsley Hayes, managing director of Hayes Connor, said: “A data breach typically affects not one or two users but thousands of individual whose personal and financial data has been unlawfully shared with third parties.
“Consequently, Hayes Connor has had to invest a significant element of capital in developing the IT and training the personnel required to prosecute these sorts of claims which we are pleased Doorway Capital were willing to provide.”
He added that internet-related litigation may quickly extend to those organisations distributing data and not just those holding it.
Mr Din said: “This is an area that law firms cannot afford to ignore. For example, users rarely read the contracts software and hardware suppliers require the user to accept before they can activate their device and it is only a matter of time before consumers challenge the enforceability of standard hardware terms and conditions.”
Greg Cox, managing partner of Simpson Millar, said: “Having paid for a smartphone or app, is it remotely reasonable for the supplier to seek to limit or exclude liability in a contract that has to be accepted before it works?”
Mr Hayes said: “The recent focus on the reliability of software security at companies like Huawei means that manufacturers of data equipment also face exposure to the risk of litigation.”
Mr Cox said Simpson Millar was looking to develop its ability to handle smartphone and internet litigation.
“As part of our current recruitment drive, we are looking to employ future partners able to apply centuries-old case law to a virtual environment and advise on exactly which jurisdictions actions can be brought in.”