HF 2253

as introduced - 88th Legislature (2013 - 2014) Posted on 02/25/2014 01:49pm

A bill for an act
relating to consumer protection; regulating data breach notification; amending
Minnesota Statutes 2012, section 325E.61.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2012, section 325E.61, is amended to read:

325E.61 DATA WAREHOUSES; NOTICE REQUIRED FOR CERTAIN
DISCLOSURES.

Subdivision 1.

Disclosure of personal information; notice required.

(a) Any
person or business that conducts business in this state, and that owns or licenses data that
includes personal information, shall disclose any breach of the security of the system
following discovery or notification of the breach in the security of the data to any deleted text begin resident
of this state deleted text end new text begin individual new text end whose unencrypted personal information was, or is reasonably
believed to have been, acquired by an unauthorized person. The disclosure must be made
in the most expedient time possible and without unreasonable delay, consistent with the
legitimate needs of law enforcement, as provided in paragraph (c), or with any measures
necessary to determine the scope of the breach, identify the individuals affected, and
restore the reasonable integrity of the data system. new text begin All individuals whose unencrypted
personal information has been breached under this paragraph must be notified that
their unencrypted information has been compromised within 48 hours of discovery or
notification of the breach.
new text end

(b) Any person or business that maintains data that includes personal information
that the person or business does not own shall notify the owner or licensee of the
information new text begin within 48 hours new text end of any breach of the security of the data immediately
following discovery, if the personal information was, or is reasonably believed to have
been, acquired by an unauthorized person.

(c) The notification required by this section and section 13.055, subdivision 6, may
be delayed to a date certain if a law enforcement agency affirmatively determines that the
notification will impede a criminal investigation.

(d) For purposes of this section and section 13.055, subdivision 6, "breach of
the security of the system" means unauthorized acquisition of computerized data that
compromises the security, confidentiality, or integrity of personal information maintained
by the person or business. Good faith acquisition of personal information by an employee
or agent of the person or business for the purposes of the person or business is not a breach
of the security system, provided that the personal information is not used or subject to
further unauthorized disclosure.

(e) For purposes of this section and section 13.055, subdivision 6, "personal
information" means an individual's first name or first initial and last name in combination
with any one or more of the following data elements, when the data element is not secured
by encryption or another method of technology that makes electronic data unreadable or
unusable, or was secured and the encryption key, password, or other means necessary for
reading or using the data was also acquired:

(1) Social Security number;

(2) driver's license number or Minnesota identification card number; or

(3) account number or credit or debit card number, in combination with any required
security code, access code, or password that would permit access to an individual's
financial account.

(f) For purposes of this section and section 13.055, subdivision 6, "personal
information" does not include publicly available information that is lawfully made
available to the general public from federal, state, or local government records.

(g) For purposes of this section and section 13.055, subdivision 6, "notice" may be
provided by one of the following methods:

(1) written notice to the most recent available address the person or business has
in its records;

(2) electronic notice, if the person's primary method of communication with the
individual is by electronic means, or if the notice provided is consistent with the provisions
regarding electronic records and signatures in United States Code, title 15, section 7001; or

(3) substitute notice, if the person or business demonstrates that the cost of providing
notice would exceed $250,000, or that the affected class of subject persons to be notified
exceeds 500,000, or the person or business does not have sufficient contact information.
Substitute notice must consist of all of the following:

(i) e-mail notice when the person or business has an e-mail address for the subject
persons;

(ii) conspicuous posting of the notice on the Web site page of the person or business,
if the person or business maintains one; and

(iii) notification to major statewide media.

(h) Notwithstanding paragraph (g), a person or business that maintains its own
notification procedures as part of an information security policy for the treatment of
personal information and is otherwise consistent with the timing requirements of this
section and section 13.055, subdivision 6, shall be deemed to be in compliance with the
notification requirements of this section and section 13.055, subdivision 6, if the person or
business notifies subject persons in accordance with its policies in the event of a breach
of security of the system.

Subd. 2.

Coordination with consumer reporting agencies.

If a person discovers
circumstances requiring notification under this section and section 13.055, subdivision
6, of more than 500 persons at one time, the person shall also notify, within 48 hours,
all consumer reporting agencies that compile and maintain files on consumers on a
nationwide basis, as defined by United States Code, title 15, section 1681a, of the timing,
distribution, and content of the notices.

Subd. 3.

Waiver prohibited.

Any waiver of the provisions of this section and
section 13.055, subdivision 6, is contrary to public policy and is void and unenforceable.

Subd. 4.

Exemption.

This section and section 13.055, subdivision 6, do not apply
to any "financial institution" as defined by United States Code, title 15, section 6809(3).

Subd. 6.

Remedies and enforcement.

The attorney general shall enforce this
section and section 13.055, subdivision 6, under section 8.31.

new text begin Subd. 7. new text end

new text begin Credit monitoring. new text end

new text begin A person or business required to give notice under
this section must also make available, at no charge to the individual, one year of credit
monitoring services to an individual whose unencrypted personal information has been,
or is reasonably believed to have been, acquired by an unauthorized individual, group of
individuals, or entity. This service must be available to the individual within 30 days
of the breach.
new text end

new text begin Subd. 8. new text end

new text begin Retailer breach. new text end

new text begin In the event that the person or business required to give
notice under this section is a retailer or wholesaler of consumer goods or services, the
person or business must provide each individual whose unencrypted personal information
was breached a $100 gift card for future use, valid for at least one year.
new text end

new text begin Subd. 9. new text end

new text begin Repayment of fees. new text end

new text begin A person or business that is subject to notice under
this section due to a data breach must reimburse an individual who incurs any charges or
fees as a consequence of the breach. Only those charges or fees not otherwise covered by
law are reimbursable under this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end