The Senate voted late Tuesday night to strike a federal rule that would have allowed consumers affected by the Equifax hack to sue the company. Without it, the millions affected by the historic security breach may be disallowed from related joining class action lawsuits. This specific rule, and only this rule, would be nullified if the joint resolution is signed by the President.
The vote was 50/50, with the tie-breaking yea cast by Vice President Pence.
The rule in question was entered into the Federal Register by the Bureau of Consumer Financial Protection in July; it prevents financial companies that bind their users by arbitration agreements from prohibiting those same users from suing as a class.
The final rule prohibits covered providers of certain consumer financial products and services from using an agreement with a consumer that provides for arbitration of any future dispute between the parties to bar the consumer from filing or participating in a class action concerning the covered consumer financial product or service.
That’s exactly like what the terms of Equifax’s services included when users went to the company’s site to see if they were affected by the hack. Although the site in question appears to have been essentially useless, it shunted users into an Equifax-provided service with terms that bound disputes to be resolved via arbitration.
Equifax later modified some of its terms to remove the arbitration clause, and also indicated in its TrustedID service FAQ that the clause “applies to the free credit file monitoring and identity theft protection products, and not the cybersecurity incident.”
