MINNEAPOLIS, Minn. (Legal Newsline) - Target has agreed to settle a class action lawsuit brought by various banks and financial institutions against the retailer over a 2013 data breach for $39 million.
Judge Paul A. Magnuson, who certified the class in September, gave preliminary approval to the settlement in an order filed Wednesday. He called the terms “fair, reasonable and adequate.”
A final approval hearing will be held in May. Participants have 90 days to raise and file objections to the deal’s terms.
The banks alleged, among other things, they were forced to replace credit and debit cards for their customers and reimburse fraud losses as a result of the data breach, which occurred between Nov. 27 and Dec. 15, 2013 -- the peak of the year’s holiday shopping season.
After the Judicial Panel on Multidistrict Litigation consolidated lawsuits regarding the breach in the U.S. District Court for the District of Minnesota, the case was separated into two “tracks”: one for consumers and one for financial institutions.
The consumer action settled earlier this year and received final approval -- also by Magnuson -- last month.
Target, in the action filed by the banks, argued the class could not be certified because there is no classwide proof supporting the institutions’ negligence claims. Such claims are subject to the laws of different states, the company argued.
The company also argued that the banks’ injuries are “risk of future harm” injuries that are not cognizable or susceptible of classwide proof.
Magnuson, in his September order certifying the class, shot down both arguments, along with Target’s notion that reissuing cards was simply a “business decision” and not an injury proximately caused by the breach.
Magnuson appointed class counsel in the case: Zimmerman Reed PLLP and Chestnut Cambronne PA as co-lead counsel and Reinhardt Wendorf & Blanchfield, Lockridge Grindal Nauen PLLP, Barrett Law Group PA, Levin Fishbein Sedran & Berman, Kessler Topaz Meltzer & Check LLP, Carlson Lynch Ltd., Scott + Scott LLP, Hausfeld LLP, and Beasley Allen Crow Methvin Portis Miles PC as co-class counsel.
Zimmerman Reed and Chestnut Cambronne both were appointed settlement class counsel, according to Magnuson’s order this week.
The National Association of Federal Credit Unions, which pushed for higher payouts to the bank and credit card issuers, said in a statement this week that it would continue to press for action on data security legislation that ensures consumers “the greatest data protection possible.”
From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.