Schnuck Settles Data Breach Lawsuit

Schnuck Markets (which does business as Schnucks) announced Monday (Aug. 11) that it has settled a 2013 security breach and will be sending checks to some of its shoppers. The settlement includes paying shoppers for “documented lost time,” which is unusual in these kinds of databreach cases.

The breached happened between Dec. 9, 2012, and March 30, 2013, and “involved the insertion of malicious computer code that targeted data in the magnetic stripe of credit and debit cards swiped at 79 Schnucks stores,” the chain announced.

The full cost of closing the book on this breach won’t be known until shoppers start applying for the money and it’s determined how many of those applicants have valid claims.

There are three different types of reimbursements that were approved by the court.

The first is reimbursement of as much as $200 for out-of-pocket expenses and “documented lost time that resulted from the Security Incident. This payment type provides reimbursement related to 14 categories of out-of-pocket expenses and lost time including unreimbursed bank fees, card reissuance fees, overdraft fees, postage and credit reports.”

The settlement only allows compensation at a rate of $10/hour and caps the hours that can be billed at three.

The second category calls for $10 for each payment card that “had fraudulent charges as a result of the Security Incident, even though those charges were reversed or credited back to the cardholder’s account.” That is also an unusual settlement offer, as retailers have generally been asked to pay nothing if shoppers were fully compensated for any charges.

Then there’s the top-level, which calls reimbursement of as much as $10,000 for “extraordinary unreimbursed monetary losses which were more likely than not caused by the Security Incident.”

The settlement also specified exposure limits for the chain. “If the total amount needed to pay valid claims in categories (1) and (2) exceeds $1.6 million, or if the amount needed to pay valid claims in category (3) exceeds $500,000, Class Members’ payments may be reduced and paid proportionally,” the settlement agreement said.