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Litigation, P.C. Law Firm
Los Angeles Litigation Law Firm 424-284-2401

Cybersecurity Can Make Or Break Your Company’s Reputation And Bottom Line


Only half of small businesses are still operating five years after they incorporate. But what determines which ones stay afloat while the others become insolvent and close? Is it brand identity? Is it budgeting and sticking to a budget? Sometimes it is something much less glamorous. (You know you are a business school nerd if you think budgeting is glamorous.)

Many businesses have suffered major setbacks in the form of data breaches and cyberattacks, and unless your company has deep pockets, it can be difficult to recover from these setbacks. Investing in cybersecurity infrastructure can protect your company from costly cyberattacks that erode the public’s trust in your brand. A Los Angeles business litigation attorney can help you resolve legal disputes and claims related to corporate data breaches and can help you draft contracts to engage the services of external cybersecurity firms.

Virtual-Premises Liability

As a business owner, you have a legal responsibility to ensure that customers are safe at your place of business. To that end, think of how much work you put into maintaining the physical location of your business to avoid preventable accidents. You are also legally responsible for the safety of your customers’ personal-identifying information, bank account numbers, and credit card numbers. If these get stolen when a point-of-sale device or if the company’s computer network suffers a data breach, the customers have the right to file a claim against you for the financial losses they suffered when they became victims of identity theft. Think of it as virtual-premises liability.

Even the smallest ecommerce businesses store the data of their customers. Imagine if all of those customers’ identities were stolen. Would you as the business owner be able to afford to compensate them all and still have enough money left to keep your business operational? Probably not. That is why you should invest in cybersecurity.

Even worse than the financial losses can be the damage to your company’s reputation. Trustworthiness is the most valuable asset a business can have.

The WannaCry Ransomware Attack of 2017: A Cautionary Tale

In 2017, a ransomware called WannaCry targeted large companies. Microsoft quickly became aware of the ransomware and developed a patch to protect against it. The companies that implemented the patch (in other words, the ones with a robust cybersecurity apparatus) were able to repel the ransomware attack. Companies that were breached faced lawsuits from customers whose data the hackers stole. Those companies lost their lawsuits because they had not done their part to protect themselves from the cyberattack; a patch was available, but they had not bothered to find out about it or install it.

Speak With a Los Angeles Corporate Law Attorney

When it comes to lawsuits against your company, an ounce of prevention is worth a pound of cure. A corporate lawyer can help you with the legal aspects of your company’s cybersecurity strategy so you can prevent data breaches. Contact Litigation, P.C. in Los Angeles to discuss your situation or call (424)284-2401.


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