Members of hacked adultery website Ashley Madison are asking for more than $1 billion through class-action lawsuits that have been filed in the U.S. and Canada after the personal details of tens of millions of account holders were leaked online.
Summons were filed in federal court this week in Texas and California compelling Ashley Madison’s parent company to respond to suits filed in both districts in the wake of the breach. Toronto-based Avid Life Media now has until Sept. 14 to answer accusations that it failed to safeguard sensitive user data that was dumped online last week.
Along with a suit filed last month in Missouri and a class-action claim entered in Ontario, Canada, on Thursday, Avid Life Media is already being asked to pay hundreds of millions of dollars to members — married individuals who signed up for the site to procure an illicit affair — affected by the breach. The Associated Press also reported Tuesday that lawsuits had been filed in Minnesota, Tennessee and Georgia.
Hackers compromised Avid’s network on or before July 12, according to law enforcement, and threatened to post member data unless the company shut down Ashley Madison.
The company said it did not store data that customers had paid to have purged through its “paid-delete” feature, but last week hackers began distributing troves of account info and financial transactions tied to members after Avid failed to act on their demands.
In U.S. District Court for the Northern District of Texas, attorneys say in a 27-page complaint that Avid failed its obligations to abide by best practices and industry standards concerning digital security.
The suit alleges violations of the Federal Stored Communications Act and state laws, and claims the company is guilty of negligence, breach of contract and causing emotional distress. Lawyers representing the unidentified lead plaintiff are seeking half-a-billion dollars, according to CBS News.
Attorneys with the Schmidt Firm in Dallas, Texas, say they are accepting cases in all 50 states on behalf of Ashley Madison users who were wronged in the hack.
In the Central District of California, attorneys filed a similar suit and asked the court to grant class-action status so other members impacted by the “nightmare” brought on by hackers can see relief.
“Needless to say, this dumping of sensitive personal and financial information is bound to have catastrophic effects on the lives of the website’s users,” the complaint claims.
Attorneys in California and Texas — as well as the Eastern District of Missouri, where a class-action suit was proposed last month before the member info was published online — all say their claims are in excess of $5 million.
Two firms in Canada said last week that they were bringing a class-action suit against Avid and would seek upwards of $760 million in damages. Attorneys there are representing a disabled widower who joined Ashley Madison after his wife died of breast cancer but never met anybody off the site, and say other members have appealed for help as well as a result of the hack.
“Numerous former users of AshleyMadison.com have approached the law firms to inquire about their privacy rights under Canadian law,” Charney Lawyers and Sutts, Strosberg LLP said in a joint statement. “They are outraged that AshleyMadison.com failed to protect its users’ information. In many cases, the users paid an additional fee for the website to remove all of their user data, only to discover that the information was left intact and exposed.”
Even if Avid agreed to award $100 each to half of Ashley Madison’s roughly 37 million customers, the company would still stand to lose nearly $2 billion. Avid earned around $115 million in revenue during 2014, according to court filings.
On Monday, Avid said they were prepared to pay $500,000 to anyone who can help secure the arrest and conviction of the Ashley Madison hackers. Individuals calling themselves the Impact Team have taken credit for the breach since mid-July.
“Too bad for those men, they’re cheating dirtbags and deserve no such discretion,” the hackers wrote when they claimed the breach last month. “Too bad for ALM, you promised secrecy but didn’t deliver. We’ve got the complete set of profiles in our DB dumps, and we’ll release them soon if Ashley Madison stays online. And with over 37 million members, mostly from the US and Canada, a significant percentage of the population is about to have a very bad day, including many rich and powerful people.”