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Even if most of the developers nowadays understand the necessity of encryption, a consequent amount of websites still store the user's password as plain-text. It can be easy to spot : just asking for a password recovery and see if they send back your old password in the email, or harder trough pen-testing in order to see how are the password stored.

If by any method someone had to find a website like this, is it possible to sue the company for "voluntary making the information system weak" ? Or should we be more "nice" and politely ask for the webmaster to remove the concerned user from its DB ? (let's keep in mind that some people just disable accounts without removing them, c.f. Ashley Madison's hack).

Can the law change on this kind of issues according to the country hosting the DB ? to the country where the webmaster is from ? to the country the user is from ?

Thanks for reading.

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Yes a company can be sued (since anyone can sue anyone). But in order to win a lawsuit, you have to have damages as a result of some action, AND you must prove that the action was done with intent to harm or was otherwise negligent.

So following your website example, a lot of things would have to happen:

  1. The website would have to be hacked.
  2. If the passwords are encrypted instead of hashed (which still qualifies as "plain-text" once they email it to you), the hacker would have to figure out how to decrypt the passwords. (Which a good hacker could probably do.)
  3. The hacker would have to take those passwords and do something with them that causes damage to their owners.

Even if all of those things happened, you would still also have to prove negligence on their part which would be pretty difficult to do because the flaw that was hacked would be the focus of negligence discussions moreso than what was stolen.

That being said, if your goal is simply to get them to fix the problem, rather than receive monetary damages, then you could still sue for an action to be taken. You'd have to pay by the hour for the attorney since they wouldn't have a chance of winning monetary damages. But in all likelihood the website owner, upon seeing the lawsuit, would fix the problem before it gets to court, so I could see that having the desired effect. That is if you think it's worth the cost of filing the lawsuit in the first place. Perhaps you could save yourself the cost of an attorney and just threaten to sue if they don't fix the problem.

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    If I understood correctly your 3 points, it means that the company could be sued (with consequences) only if "my" credentials are stolen AND used towards me, but nothing will be done if there is only an unexploited flaw ? In my case, for instance, I recently subscribed to a little merchandising website. A bit curious, I tried to investigate the website and... found a complete up-to-date database dump. With clear passwords, including mine. Of course I used a "new" password for this website, so it doesn't affect me particularly, but many others could be victim of a hacker. – MedAl Jun 1 '16 at 7:15
  • Double comment, I missed some characters. I e-mailed the owner of the website, and he told me that he would patch it. Nothing has been done, there is still more and more passwords available... – MedAl Jun 1 '16 at 7:16
  • That seems like it could possibly pass the negligence test, but you (or others) would have to be damaged in some way too in order to be compensated for a loss. – TTT Jun 1 '16 at 13:36
  • I'm not talking about being compensated : I didn't see the point like this. I would rather like to see a judge telling the webmaster to care about security and apply real security measures on his websites, so we all can use it safely – MedAl Jun 1 '16 at 14:20
  • [Edit : this comment refers to the answer]] I see what you mean. So I assume that the more decent way to improve it, after having already warned the webmaster about the flaw, without any counter measure from him, is to publicly expose the flaw and harm the website's reputation ? – MedAl Jun 1 '16 at 14:35
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The somewhat facetious answer to the question is "a company can be sued for anything".

The more useful answer is that if you were to sue a company for storing plain-text passwords, you would need to rely on some legal authority in the jurisdiction to establish and support a cause of action. This might be negligence on the part of the company, which might require that actual damages be shown. It could also be codified in a statute of the jurisdiction.

So in answer to your questions:

is it possible to sue the company for "voluntary making the information system weak"?

Yes, subject to the above.

Or should we be more "nice" and politely ask for the webmaster to remove the concerned user from its DB ?

That's not really a legal question; unless there are laws that may coerce the safe storage of credentials.

Can the law change on this kind of issues according to the country hosting the DB ? to the country where the webmaster is from ? to the country the user is from ?

These are all factors and may change the applicable laws.

  • Could you tell me a bit more about this part please ? "This might be negligence on the part of the company, which might require that actual damages be shown. It could also be codified in a statute of the jurisdiction." – MedAl May 30 '16 at 15:02
  • "Codified in a statute of a jurisdiction" means that there could be a law, government decree, or a similar binding document requiring certain companies to adopt certain security measures (such as storing passwords with a salted hash, and so on). – A. Darwin May 31 '16 at 6:40

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