Australia: Sony pictures - a lesson in how not to store data

Sony has found itself in a familiar head-line grabbing scenario. With the ink barely dry on the $15 million settlement of a class action brought following the 2011 Sony PlayStation data breach, this time Sony Pictures Entertainment, the TV and movie arm of Sony has suffered a cyber attack from a hacking group known as "Guardians of Peace".

In late November the hacking group infiltrated Sony's internal network, stole data, hijacked company twitter accounts, defaced its websites and disabled the corporate email system. There are reports that during the attack the hackers also destroyed data on Sony's servers.

The vast amount of data stolen and later leaked on peer-to-peer file sharing websites includes:

  • five unreleased movies;
  • files containing details of 47,000 employees including names, dates of birth, social security numbers, home addressees, salaries, medical records and performance reviews;
  • files containing credit card numbers, passwords and identity documents;
  • outlook mailboxes;
  • sales data and information on planned movie and TV productions; and
  • IT data including security IDs, authentication details, vendor passwords, how to access various servers, master asset lists and the location of databases and servers.

This data is still available for download on file sharing websites. As well as including valuable corporate and confidential information and Sony's intellectual property, the data stolen and leaked included personal information of Sony's employees including its executives and actors.

Gossip websites are having a field day, analysing the leaked data and reporting the salaries of various actors, directors and producers.

The ramifications for Sony are colossal. Sony admits the full extent of the data breach is not yet known. Along with significant reputational damage, Sony will incur significant costs to investigate the data breach, remedy its IT system, legal fees and class action lawsuits.

On 15 December 2014, current and former Sony employees filed a class action against Sony alleging that Sony failed to protect their personal information. The damage bill from the 2011 worldwide data breach incident of Sony PlayStation, which resulted in the disclosure of 77 million user accounts, names and credit card details, is still fresh in the minds of Sony executives. Sony estimated the costs to remedy the 2011 worldwide data breach incident was at least $171 million.

Sony has labeled the cyber attacks as "malicious criminal acts" and a "brazen attack on our company, our employees and our business partners". However Sony's data security practices are under the spotlight following the data loss.

It has been reported that much of the leaked personal information of employees was stored in excel files which were not encrypted or password protected. There are also reports that thousands of passwords for computer and social media accounts were stored in a folder labeled "Password".


Sony's misfortune is a timely reminder for all Australian organisations to consider their own responsibilities in respect of data security and the storage of personal information.

In the Australian context, these data storage practices would not meet the requirements of APP11 of the Australian Privacy Principles made under the Privacy Act 1988 (Cth). APP11 requires an organisation to take steps to ensure the security of personal information that it holds, and to protect the information from:

  • misuse, interference and loss; and
  • unauthorised access, modification or disclosure.

The OAIC's Data Breach Notification Guide provides that security safeguards need to be implemented for physical records, computers, networks and communications. The Guidelines recommend organisations implement technologies to secure personal information such as multi-factor authentication, strong access controls and robust encryption, and separating the internal IT network into multiple functional segments.

The OAIC's Guide to Information Security also details the steps organisations should implement to protect personal information. A handy one-page summary is available here. A revised version of this Guide was released for public consultation earlier this year, and an updated version should be released shortly.

Although Australia does not yet have a mandatory requirement to notify affected individuals and regulators of data breaches, any delay or failure to notify affected individuals that a data breach incident has occurred will be one of the factors considered by the Privacy Commissioner to determine whether the organisation has taken reasonable steps to protect information under APP11.

Also, the Data Breach Notification Guide provides that reasonable steps to secure personal information under APP11 include ensuring that the organisation has a clearly documented and implemented data breach policy and response plan. Sony was widely criticised, including by the Australian Privacy Commissioner, for its delay in notifying users of the 2011 data breach.


The most recent Sony data breach incident is a reminder of the importance of robust security systems and protocols to store information (including personal information). Perhaps a prudent New Year's resolution for your organisation is to:

  • conduct a wholesale IT security audit and governance review to test IT security vulnerabilities;
  • ensure staff training programs are implemented and data breach response plans are documented; and
  • otherwise adopt a "privacy by design" approach which assesses privacy implications at the outset of a project that involves any change to the way personal information is collected, used, disclosed, stored or destroyed or de-identified.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Most awarded firm and Australian deal of the year
Australasian Legal Business Awards
Employer of Choice for Women
Equal Opportunity for Women
in the Workplace (EOWA)

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions