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Sony discloses security breach

By Chris Bennett, Tudor Carsten, Michael R. Coburn, Sarah Dale-Harris, Pablo Guzman, Danielle (Dani) Lemon, Chris Metcalfe and David Spratley

Sony has issued a notice to PLAYSTATION Network users that their personal information on the PLAYSTATION Store may have been compromised. The notice warns that some users' passwords may have been changed through unauthorized access, allowing third parties to view the personal information stored on users' accounts. The notice also states that the security problem has been resolved.

A copy of the notice is available here.

The security breach raises an interesting issue under Canadian privacy law. In Canada, there are several statutes that govern privacy, including the federal Personal Information Protection and Electronic Documents Act and various provincial statutes including British Columbia's Personal Information Protection Act.

All of these statutes require companies (including video game publishers and developers) to maintain the security of the personal information they collect. However, few of these statutes explicitly require companies to disclose that a security breach has occurred. Therefore, when faced with a security breach, companies often need to balance the risks of non-disclosure (e.g. identity fraud that could have been prevented by disclosure) with the possible PR fall-out of making a disclosure.

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Full post as published by Video Game Law Blog on March 28, 2008 (boomark / email).