United States: The Anthem Data Breach: The Fallout And What’s Next

By now (unless you have been under a snow drift), you have likely heard about the apparent intrusion into a database at the nation's largest health insurer, Anthem, Inc.  Rather than reiterate the facts as currently known (see Anthem's dedicated website for updates), we'll look at the fallout and what's next.

The Fallout

Anthem first detected a breach of a database containing records for 80 million customers and employees on January 29, 2015.  On February 4 – less than one week later – Anthem disclosed the existence of the breach and began providing notice to affected individuals.  What followed then was all too predictable; over the next two days Anthem was named as a defendant in six separate class action lawsuits filed in federal courts in Alabama, California, Georgia and Indiana.

In the brief time elapsed between disclosure of the Anthem data breach and filing of the first class actions few details were known about how the breach occurred.  This did not deter would-be litigants who, in the absence of details about the data theft, filed complaints larded with boilerplate allegations concerning the omnipresent threat of data theft and the potential harms that could conceivably befall persons whose data was stolen.  Unsurprisingly, the race to the courthouse has encouraged a certain amount of expediency in pleading these hastily-filed claims, as evidenced by one complaint against Anthem which copies, almost verbatim, allegations made by a different law firm on behalf of a different plaintiff in one of the Target data breach class actions.  See Christina v Target Corp., No. 3:14-cv-00051-SDD-RLB (M.D. La.).

Absent knowledge about how the breach occurred or even whether the named plaintiffs' own information was stolen, the complaints rest on simplistic allegations as to Anthem's alleged wrongdoing and the harms that might be suffered by those whose information was at risk.  The lawsuits uniformly plead what amounts to a strict liability standard – if confidential information was stolen from Anthem's databases, then Anthem perforce failed to exercise reasonable care to protect that information.  With respect to injury, each of the lawsuits focuses on the risk of identity theft.  None of the complaints allege that any named plaintiff actually suffered identity theft.

What can companies do to avoid inviting a rash of class action litigation by disclosing a data breach?  Not much.  As is evident from the Mintz Matrix of state data breach notification laws, many states require reasonably prompt notice to affected persons when a breach occurs.  Anthem provides services in California and given that this is health information, it would have been required to provide notice in a very short window.  What is reasonable in any given context will vary.  But whether the breach is announced within a few days of discovery or, for investigative or other reasons, is disclosed at some later point in time, plaintiffs' lawyers will soon be locked in a race to the courthouse in order to obtain a perceived first mover advantage in taking control of ensuing litigation.  Whenever a data breach is announced, as night follows day, lawsuits will follow.

The filing of multiple lawsuits in multiple federal courts means that the Anthem data breach litigation, like litigation concerning the Home Depot and Target data breaches, is likely to end up being subject to consolidation proceedings before the federal Judicial Panel on Multidistrict Litigation, which will determine whether to consolidate the cases for pretrial proceedings and, if so, which court will conduct those proceedings.  Substantive litigation is unlikely to occur before such procedural issues are resolved.

The cases filed against Anthem are as follows:

What's Next 

Concerns for Employers.    Members of the affected health insurance plans are not the only ones to be concerned about the Anthem breach.  If you are an employer whose employees' health benefits programs have been placed with Anthem or your employees are covered by some Anthem-offered product, you should be examining any potential obligations you may have to your covered employees.   If your group health plan is self-insured, you should be assessing and reviewing your HIPAA Policies & Procedures and your agreements with Anthem to determine what your obligations are for any unauthorized disclosures of HIPAA Protected Health Information —- and you may indeed have some obligations under HIPAA.   You should be reviewing these issues now to determine what your plan's status is and what your company's role is and what role is played by Anthem.  This breach may not involve medical/clinical data (according to Anthem), but that does not mean it is not a "HIPAA breach."   That has been inaccurately reported by some media.   If you are a self-insured group health plan, you may be "covered entity" for purposes of HIPAA and may have separate notification obligations apart from the public information being provided and sent by Anthem.

Review your contract and other agreements with Anthem to make a determination as to where your company stands and contact Anthem to ensure that your employees (and your company's interests) are protected.

Anthem is still evaluating the damage.   Theories abound as to the origin of the hack and whether this was an attempt to harvest the personal information of millions of Anthem members or a more targeted, state-sponsored cyber-attack for other reasons, employers should be on the alert for unusual activity in networks or attempts by individuals to access company information.  The scope of information contained in the Anthem databases can be used not only to steal the identities of individuals, but also to gain access to corporate networks through "social engineering" and perhaps hold corporate "crown jewels" for ransom.

Regulatory Actions.  Attorneys general in at least six states, including California, Connecticut, and Massachusetts, have launched investigations into the breach.  For example, Connecticut AG Jepsen has sent a letter to Anthem's CEO demanding a response by March 4, and the National Association of Insurance Commissioners has called for a multi-state examination of Anthem and the circumstances surrounding the breach.Today, the New York Department of Financial Services announced new cyber security assessments for insurance companies in the Empire State.  More on that to come.

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.

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

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

Kevin M. McGinty
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). 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 & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd 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 or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.