Software Developers Should Have E&O Policies to Cover Product Defect Claims
A recent lawsuit filed against Redmond, Wash.-based Microsoft Corp. should alert software developers to potential product defect loss exposures.
In that case, filed in Los Angeles Superior Court early last month, a California plaintiff whose Social Security number and identity were stolen, allegedly due to a flaw in Windows software, is suing Microsoft for manufacturing an allegedly defective product. Her attorney is attempting to make the case into a class action.
Lawsuits against software developers claiming that they failed to build adequate security safeguards into their products may be barred by disclaimers absolving the developers from liability for security breaches, according to attorneys in the technology field. But even if the cases dont result in damages, software developers may need defense cost coverage to get the cases dismissed or avoid having them certified as class actions.
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