CHICAGO—A group of financial institutions, largely credit unions, have received a $5.2-million settlement in a class action lawsuit against Kmart over a data breach.
U.S. District Judge John Lee of the Northern District of Illinois approved the deal in late May, the Cook County Record reported.
Greater Chautauqua Federal Credit Union, First Choice Federal Credit Union, Gulf Coast Bank & Trust Company, Governmental Employees Credit Union and Oteen V.A. Federal Credit Union filed the class action in 2015 against Kmart and its parent company, Sears Holding Co. The suit stemmed from a data breach at Kmart in 2014.
The plaintiffs said hackers compromised and stole confidential information of Kmart customers, primarily credit and debit card data, because Kmart allegedly failed to adequately protect the information. About 8.1 million credit and debit cards were affected, according to the plaintiffs.
The decision awards $3.5 million to be divided among the plaintiffs, with $1.7 million going to the plaintiffs’ attorneys. The five financial institutions that brought the suit, will also receive an extra $10,000 each for their efforts in launching the litigation, the newspaper reported.
In addition, Kmart agreed to reimburse $95,575 to plaintiffs for costs and expenses the plaintiffs absorbed in pursuing the suit. The $93,000 is not being taken from the $5.2 settlement fund. Kmart has also agreed to also change several of its data security practices, the Cook County Record reported.
A status hearing was set for June 16 and the judge must approve the final allocation plan.