Yahoo Agrees to Pay $50M to Settle Email Data Breach Class Action

Yahoo users are seeking approval from a California federal judge for a $50 million settlement deal that would end three class action lawsuits claiming that Yahoo’s negligence led to data breaches affecting American and Israeli email users.

On Monday, consumers in the Yahoo data breach class action lawsuit said that the proposed $50 million deal would be the largest cash fund in history for data breach class members.

U.S. District Judge Lucy H. Koh will reportedly make a decision on the proposed Yahoo class action settlement deal on Nov. 29.

Part of what makes this settlement so large for consumers is that as part of the deal, Yahoo agreed to pay separate compensation for attorneys fees, costs and expenses, and fees for the named plaintiffs. So, the $35 million agreed-upon for these fees won’t come out of the consumers’ $50 million.

Under the terms of the Yahoo class action settlement, Class Members can claim $25 per hour for time spent dealing with issues related to the data breach.

Yahoo account holders who provide documentation regarding their time spent remedying the issue can claim up to 15 hours, or $375. Those affected Yahoo Class Members who do not document their time, can claim up to five hours, or $125.

Paid Users who file a claim are expected to receive up to 25 percent per year for services paid between Jan. 1, 2012 and Dec. 31, 2016. This payment is in addition to other benefits provided by the Yahoo data breach settlement.

Further, the Yahoo class action settlement provides “Alternative Compensation” of $100 subject to decrease or increase pro rata up to $358.80. Class Members must select “Alternative Compensation” on their Claim Form to receive this benefit.

The Yahoo data breach class action settlement also provides compensation for Small Business Users who file a Claim Form to receive 25 percent of the total amount paid between Jan. 1, 2012 and Dec. 31, 2016, not to exceed $500 per year.

In addition, all affected Yahoo account holders will receive a two years of credit monitoring through AllClear which is valued at $358.80.

The Yahoo data breach class action lawsuits were filed after Yahoo made several announcements, starting in 2016 that hackers had broken into the company’s computer systems in late 2014.

The Yahoo data breach class action lawsuits survived a bid for dismissal, despite having some claims trimmed along the way.

According to Yahoo, hackers stole customer names, passwords, and account data of 500 million users.

This was thought to be the largest data breach in history, until in December 2016, Yahoo announced that it had suffered another data breach in August 2013, in which 1 billion users’ data had been stolen.

Later, in 2017, Yahoo announced that the 2013 breach had affected 3 billion users — the total number of Yahoo accounts that were in operation at the time.

Yahoo further announced that 32 million accounts had been hacked between 2015 and 2016 in another instance, when hackers used forged cookies to access the accounts without a password.

Consumers took legal action against Yahoo over these breaches, and then the class action lawsuits were consolidated in December 2016. Judge Koh oversaw the consolidation.

In July 2018, consumers sought Class certification for Yahoo users seeking injunctive relief, and for another Class of consumers seeking damages after the breaches.

The current proposed Yahoo class action settlement deal will put an end to a string of legal issues for Yahoo over these data breaches, and has been met with approval by the consumers’ representation.

Legal counsel for the Yahoo email users, made a statement on Tuesday saying that “we are pleased that we were able to reach a settlement with Yahoo, which would provide relief to impacted users and ensure that Yahoo improves its security practices going forward.”

In the proposed Yahoo data breach class action settlement deal, Yahoo will not only have to pay $50 million to consumers and more than $35 million in fees, but will have to implement practices to better protect consumer data in the future.

If the Yahoo class action settlement is approved, the company has agreed to implement credit monitoring service and implement “significant and substantial changes” to its computer security system.

Top Class Actions will post updates to this class action settlement as they become available. For the latest updates, keep checking TopClassActions.com or sign up for our free newsletter. You can also receive notifications when this article is updated by using your free Top Class Actions account and clicking the “Follow Article” button at the top of the post.

The consumers are represented by John Yanchunis of Morgan & Morgan Complex Litigation Group, Stuart A. Davidson of Robbins Geller Rudman & Dowd LLP, Gayle M. Blatt of Casey Gerry Schenk Francavilla Blatt & Penfield LLP, Ariana J. Tadler of Milberg Tadler Phillips Grossman LLP, Karen Hanson Riebe of Lockridge Grindal Nauen PLLP and Daniel S. Robinson of Robinson Calcagnie Inc.

The Yahoo Email Data Breach Class Action Lawsuit is In re: Yahoo Inc. Customer Data Security Breach Litigation, Case No. 5:16-md-02752, in the U.S. District Court for the Northern District of California.

UPDATE: On Jan. 28, 2019, a federal judgedenied a $50 million Yahoo class action settlement,finding the proposed deal lacked specific information about ways the tech company would improve data security.

UPDATE 2: On April 9, 2019, Yahoo has now agreed to pay $117.5 millionto resolve legal claims regarding three large data breaches that affected the internet company. 

UPDATE 3: On July 20, 2019, a federal judge has preliminarily signed off on a$117 million class action settlement agreement between Yahoo and accountholders who were affected by numerous data breaches.

UPDATE 4: September 2019, the Yahoo data breach class action settlement is now open.Click here to file a claim.