MGM Resorts Settles Data Breach Lawsuit for $45M
The Key Points at a Glance
MGM Resorts International has agreed to a settlement payment of 45 million USD to resolve a class-action lawsuit stemming from two data breaches. The incidents occurred in July 2019 and September 2023, affecting sensitive personal information of millions of hotel guests. Some of the stolen data was later sold on online platforms. Affected customers can apply for compensation and additional services such as identity and credit monitoring, depending on the severity of the data breach.
Background of the Data Breaches
In July 2019 and again in September 2023, MGM Resorts’ IT systems fell victim to cyberattacks. Sensitive data such as addresses, dates of birth, driver’s license numbers, and social security numbers were stolen. These incidents affected “tens of millions” of guests who had stayed at MGM hotels. Some of the stolen information later appeared on online marketplaces, further increasing the risks for those affected.
The Class-Action Lawsuit in Detail
The lawsuit against MGM Resorts was based on allegations that the company failed to implement adequate security measures to protect customer data. The plaintiffs argued that MGM Resorts did not take the necessary steps to prevent such incidents. The class-action lawsuit resulted in a settlement that was preliminarily approved by a U.S. court in Nevada.
Compensation for Affected Customers
Affected customers are categorized into three groups based on the type of compromised data:
– **Tier 1:** Customers whose social security numbers or military IDs were affected will receive 75 USD.
– **Tier 2:** Customers whose passport or driver’s license numbers were compromised will receive 50 USD.
– **Tier 3:** Customers with less sensitive data breaches will receive 20 USD.
Additionally, all affected individuals can apply for free services such as identity theft protection and credit monitoring. Those who can prove financial losses due to the data breach are entitled to additional compensation of up to 15,000 USD.
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Comment on the Settlement
Douglas J. McNamara, a partner at the law firm Cohen Milstein, expressed satisfaction with the settlement: “On behalf of millions of MGM customers, I am pleased with this settlement. The hotel and entertainment industry is a prime target for hackers.” McNamara also pointed out that similar attacks targeted Caesars Entertainment in 2023, highlighting the growing threats within the industry.
Growing Threat to the Industry
The attacks on MGM Resorts and Caesars Entertainment demonstrate how vulnerable the hotel and entertainment industry is to cyberattacks. These incidents underscore the need to strengthen IT security within the sector. For customers, this means staying vigilant and taking advantage of protective measures such as credit monitoring.
Our Assessment
The settlement by MGM Resorts is an important step toward regaining customer trust. While the compensation amounts may seem modest to some affected individuals, the additional services such as identity and credit monitoring offer long-term protection. This case highlights the critical need for companies in the gaming and hospitality industries to continuously improve their security measures to prevent data breaches. Customers should also act proactively to protect their personal information.
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