Judge OKs $20 million payment in data theft case

WASHINGTON (AP) — A federal judge on Tuesday approved the government's plans to pay a total of $20 million to veterans exposed to possible identity theft in 2006, calling it a welcome deal to settle lawsuits after a Veterans Affairs employee lost a laptop containing their sensitive personal information.

The payments will range from $75 to $1,500 for up to 26.5 million veterans who incurred out of pocket expenses for credit monitoring or physical symptoms of emotional distress. In exchange, lawyers for the veterans agreed to drop their class-action lawsuit alleging invasion of privacy in a case involving the government's largest data security breach.

"Thank you, to the government in particular, for the $20 million," said U.S. District Judge James Robertson. "Everyone has got to like this."

The judge's move Tuesday means that lawyers will now notify veterans of the settlement in newspapers and magazines around the country. Once veterans submit their claims, lawyers for both sides will return to court in July for final approval for the payments.

The lawsuit came after a VA data analyst in 2006 admitted that thieves had taken from his home a laptop and external drive containing the names, birth dates and Social Security numbers of veterans and active-duty troops. The laptop was later recovered intact, but a blistering report by the VA inspector general faulted both the VA employee and his superiors for putting veterans at unreasonable risk.

Under the $20 million deal, lawyers for the veterans will receive up to $5.5 million for fees and costs, while roughly $1.4 million will be spent to notify millions of veterans and provide information about the settlement via advertisements in newspapers, magazines and a toll-free hot line.

Any remaining amount after claims are paid will be donated to the Fisher House Foundation Inc., which provides temporary housing for families of veterans receiving medical care at VA hospitals and other facilities, as well as The Intrepid Fallen Heroes Fund, which is building a new center in Bethesda, Md., that will be devoted to treatment and research of traumatic brain injury.

Because the FBI determined that the VA data had not been accessed, Robertson said there might be some payments to veterans who were so stressed after news of the theft that they rushed to purchase credit monitoring. But he said he believed most of the money would probably end up being donated to charity.

Sen. Daniel Akaka, D-Hawaii, who chairs the Senate Veterans Affairs Committee, said the 2006 data theft offers an important lesson in ensuring the government upholds its promise to protect veterans' data privacy. New VA Secretary Eric Shinseki has said he wants to push for greater use of electronic data as a way to reduce errors in medical care and speed processing of claims.

"Given that this information was taken to a private residence in violation of VA policy, the government should be held accountable," Akaka said. "VA has improved its information protection policies since this incident, but more must be done."

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