NEWS RELEASE
ATTORNEY GENERAL DANA NESSEL
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LANSING – Today, Michigan Department of Attorney General Corporate Oversight Division Chief Jason Evans and Assistant Attorney General Kathy Fitzgerald testified before the Senate Committee on Finance, Insurance, and Consumer Protection in support of two legislative packages that would enhance consumer protections from data breaches and price gouging, announced Michigan Attorney General Dana Nessel. They advocated for Senate Bills 888-892, which would strengthen state law to require companies that experience a data breach to provide timely notice of the breach to the Department of Attorney General, and Senate Bills 954-956, which aim to strengthen protections against price gouging during an emergency declaration or a market disruption.
“Michigan must join the majority of states that already require Attorney General notification of data breaches and hold price gougers accountable,” Nessel said. “While not revolutionary, these measures are essential to protecting consumers and ensuring corporate responsibility. Passing legislation to mandate these protections would affirm our commitment to defending consumers’ interests in the face of ever-increasing numbers of data breaches impacting their personal information and businesses looking to hike prices when residents are at their most vulnerable. I applaud the legislators championing these efforts.”
Michigan has experienced a surge in data breaches. In recent months, Attorney General Nessel notified Michigan residents about two McLaren cyber attacks affecting millions of patients. Similarly, the Attorney General shared resources following a Change Healthcare data breach that could impact up to a third of all Americans. She has also issued consumer alerts and informed consumers of the Department of Attorney General’s Data Breaches: What to do Next webpage after massive cyber attacks on AT&T and Comcast/Xfinity.
State law does not currently require companies that experience a data breach to share that information with the Department of Attorney General. The Department often learns about these data breaches through media reports. The legislative package – similar to 36 other states and the District of Columbia – would strengthen Michigan law by requiring companies that experience a data breach that impacts 100 or more Michigan residents to inform the Department of Attorney General. Senate Bills 888-892 would also amend the ID Theft Protection Act to:
- Expand the scope of when consumer notice is required;
- Require third-party vendor notice to be given to its client immediately following the discovery of a data breach;
- Address delays in notice by including a deadline of 45 days from the date the breach is discovered;
- Include the duty to safeguard consumers’ personal information;
- Include the duty of impacted entities to investigate following a data breach;
- Provide the Department of Attorney General investigative authority over data breaches; and
- Authorize the Department of Attorney General to seek injunctive relief and costs in enforcement actions related to data breaches, in addition to existing civil penalties.
The Attorney General has also been a strong advocate for consumer protection against price gouging. Last month, the Attorney General participated in a roundtable discussion alongside lawmakers announcing the introduction of Senate Bills 954-956. In July, Attorney General Nessel filed a lawsuit against several tree service companies for allegedly deceiving and price gouging consumers seeking storm clean-up services. She has also reached compliance agreements with Novi Hilton and pharmacies suspected of price gouging. However, under the current Michigan Consumer Protection Act, action is only possible when a single business, or a small group of businesses, charge excessive prices compared to others, not if sellers hike their rates in unison.
Senate Bills 954-956 target price gouging on consumer goods, emergency supplies, lodging, and energy products like gasoline or propane. The bills define price gouging as selling goods or services at more than a 10 percent increase from the price immediately before the emergency or market disruption. The legislation would allow sellers to justify price increases and outlines legal actions the Department of Attorney General or local prosecutors can take against violators, as well as penalties for those found in violation.
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