Investor, TJX settle suit over data theft
TJX Cos., which owns the T.J. Maxx and Marshalls discount retail chains, has settled an investor lawsuit related to the theft of millions of its customers’ credit card numbers.
The Louisiana Municipal Police Employees’ Retirement System, which holds shares of TJX stock, alleged that members of the TJX board of directors failed in their duty to protect customers’ personal data.
TJX announced yesterday that it had settled the lawsuit on Friday. A lawyer for the Louisiana police retirement fund, which filed its lawsuit in Delaware, where Framingham-based TJX is incorporated, did not return calls seeking comment. Bloomberg News reported the case was settled for $595,000 in legal fees and enhanced oversight of customer files.
“TJX and the current and former directors deny all allegations of wrongdoing and liability, and the settlement contains no such admissions,’’ spokeswoman Debra McConnell said in an e-mail. “TJX agreed to the settlement to eliminate the burden and expense of further litigation.’’
Between 2005 and 2007, TJX was hit by a massive Internet security breach, when a Miami-based computer hacker, Albert Gonzalez, stole 45.6 million credit card numbers from the company’s computer network. He was also involved in stealing 130 million credit card numbers from Heartland Payment Systems, a major credit card processing firm, as well as thefts from several other retailers, including BJ’s Wholesale Club in Natick. In March, a federal judge in Boston sentenced Gonzalez to 20 years in prison.
TJX’s McConnell said that the cost of the latest settlement will be covered by a $178 million cash reserve TJX had set aside in 2008 to compensate victims of the breach. The company has already settled lawsuits filed by banks and credit card issuers, as well as class-action suits by individuals.
Material from Bloomberg News was used in this report. Hiawatha Bray can be reached at email@example.com.