EUGENE, Ore. – Several credit unions that rejected the TJX settlement are plotting a potential legal strategy aimed at recovering costs and possible punitive damages associated with the retail giant’s massive data security breach.
"We did not accept the TJX settlement," said Steve McIntyre, general counsel for SELCO Community CU, who said the credit union’s share of the $40.9 million payout wouldn’t have been enough to cover all of its fraud losses caused by the leak of member account information.
Several other credit unions dissatisfied with the settlement are also contemplating a lawsuit, said McIntyre. "I think a lot of credit union folks are disappointed with the settlement," he told The Credit Union Journal.
However, if the credit unions want to pursue the pursue the retail giant in court they may have to do so individually because a recent court ruling that rejected a bid for class action status for the injured credit unions and banks. McIntyre said they have appealed that court ruling.
TJX said 95% of the credit unions and banks affected by the massive data breach voted to approve the settlement, which was paid out last week.
The TJX breach required SELCO to cancel and reissue 14,363 Visa cards and to suffer thousands of dollars in fraud losses. Hundreds of credit unions also reported substantial losses.
