Sony Pictures Entertainment has agreed to pay up to $8 million over employees’ personal data lost in the 2014 hacking scandal surrounding the release of The Interview movie.
Hackers had broken into Sony computers and released thousands of items of personal information in an attempt to derail the release of the North Korea-themed comedy.
Sony employees argued they suffered economic harm from the stolen data.
US investigators have blamed North Korean hackers for the attack.
The cyber attack wiped out massive amounts of data and led to the online distribution of emails, personal and sensitive employee data as well as pirated copies of new movies.
The lawsuit against the company was filed by former employees claiming Sony’s negligence caused them economic harm by forcing them to step up credit monitoring to address their increased risk of identity theft. They described the data breach as an “epic nightmare.”
The Interview depicted the fictional assassination of North Korean leader Kim Jong-un.
The cyber-attack drew widespread international attention and Sony subsequently stopped the movie’s general release.
An unknown group calling itself #GOP – later identified as Guardians of Peace – claimed it was behind the attack, prompting the FBI to launch an investigation.
North Korea dismissed any suggestion it may have had a hand in the attack as a form of retaliation for Sony’s release of The Interview. A North Korean foreign ministry spokesman had earlier called the movie an “act of terrorism”, promising “merciless” retaliation if it was released.
The Interview eventually received a much smaller release and was offered through legal digital downloads.
The settlement with a US District Court in Los Angeles still needs to be approved by a judge but it sees Sony paying pay up to $8 million to reimburse current and former employees for losses, preventative measures and legal fees related to the hack of its computers in 2014.
Under the agreement, Sony Entertainment will pay up to $10,000 a person, capped at $2.5 million, to reimburse employees for identity theft losses, up to $1,000 each to cover the cost of credit-fraud protection services, capped at $2 million, and up to $3.5 million to cover legal fees.
Sony Entertainment CEO Michael Lynton called the agreement “an important, positive step forward in putting the cyber-attack firmly behind us”.
The court had dismissed Sony’s initial attempt to stops the court case, confirming that the employees could pursue their claims that the company was negligent and violated a California confidentiality law.
Sony Pictures Entertainment has failed to dismiss a legal action brought by nine ex-employees over the last year’s cyber attack.
A judge said the plaintiffs could pursue claims that the film unit of the Sony corporation had been negligent.
The plaintiffs are seeking to hold Sony liable for not bolstering security after previous breaches.
“We are pleased that the court has properly recognized the harm to Sony’s employees,” said lawyer Michael Sobol.
Many Sony employees had their personal details made public in 2014 when a group calling itself Guardians of Peace leaked data from the studio’s computers.
The attack was described as an act of revenge motivated by Sony’s release of The Interview, a comedy about an assassination attempt on North Korean leader Kim Jong-un.
The nine plaintiffs claim Sony Pictures Entertainment violated a California confidentiality law by spurning security measures to stop the theft of employees’ salary and health data, Social Security numbers and other sensitive information.
Without ruling on their action’s merits, US District Judge Gary Klausner said Sony had created a “special relationship” with its employees by requiring them to provide personal information to be eligible for salaries and benefits.
The former workers said Sony’s negligence caused them economic harm and that the hack had been “an epic nightmare, much better suited to a cinematic thriller than to real life”.
The Interview, starring James Franco and Seth Rogen as journalists recruited by the CIA to assassinate Kim Jong-un, was initially withdrawn from cinemas but was later made available online.
South Korean activist Lee Min-bok has flown thousands of copies of controversial Sony film The Interview over the North Korean border.
Lee Min-bok said he had carried out the launches at night four times since January, most recently on April 4.
The Seth Rogen comedy, about a fictional CIA plot to kill North Korean leader Kim Jong-un, enraged Pyongyang.
Sony initially pulled The Interview after a hacking attack and threats to attack cinemas which were screening it.
But it changed its mind and gave the film a limited cinema release after being accused of responding to an attack on free speech.
The FBI says North Korea was behind the hack and threats, though it denies this.
Lee Min-bok, a defector from North Korea, said he had tied the DVDs to balloons along with bundles of US dollars and leaflets criticizing Kim Jong-un’s regime.
He told AFP news agency: “I launched thousands of copies and about a million leaflets on Saturday, near the western part of the border.”
He said the launches were all done in remote areas and without publicity but that the police “would have no right to stop me”.
Lee Min-bok told CNN, which joined him on Saturday’s launch, that he had not laughed at The Interview and found it vulgar.
But he said North Korea “hates this film because it shows Kim Jong-un as a man, not a God” and that he wanted to “tell the truth” to North Koreans.
Any North Korean who had access to a DVD player and was found to have watched the film would likely face a lengthy sentence in a prison camp.
South Korean activists have repeatedly carried out balloon drops across the border of material which they say shows the reality of life outside the restrictive country, in the hope of encouraging North Koreans to reject propaganda and stand up to their leadership.
North Korea has demanded South Korea stop such launches, saying they are provocative. Its border guards have in the past tried to shoot down the balloons.
Sony Pictures’ co-chair Amy Pascal has decided to step down following a debilitating cyber attack that revealed her private emails.
Amy Pascal will start a production company that will launch in May 2015.
She has already apologized for certain revelations that came as a result of the leaked emails.
Last month, Sony condemned the “vicious” attack, which led it to suspend the release of the film The Interview.
“I have spent almost my entire professional life at Sony Pictures and I am energized to be starting this new chapter based at the company I call home,” said Amy Pascal in a statement.
She added that her transition to a production role had been discussed “for some time”.
As part of the agreement, Sony will fund Amy Pascal’s production company for at least the next four years, and it will retain distribution rights.
Sony did not immediately name a successor to Amy Pascal, leaving Michael Lynton as the sole head of one of Hollywood’s biggest production studios.
Amy Pascal was one of the highest profile Sony names whose emails were leaked as part of the hack.
She reportedly commented on the viewing habits of President Barack Obama in a derogatory manner in an email to producer Scott Rudin.
Amy Pascal and Scott Rudin both subsequently apologized for the emails, with Amy Pascal saying in a statement at the time: “The content of my emails to Scott were insensitive and inappropriate but are not an accurate reflection of who I am.
“Although this was a private communication that was stolen, I accept full responsibility for what I wrote and apologize to everyone who was offended.”
On November 24, Sony revealed that it had been the subject of a hack by a group calling themselves Guardians of Peace (GOP).
GOP was later traced back to North Korea, who US authorities believe instituted the attack in retaliation for Sony’s decision to produce The Interview, in which North Korean leader Kim Jong-Un is killed.
The group gained access to the company’s network and stole huge amounts of internal information, including emails and copies of films, such as Annie, that had not yet been released.
Although Sony did withdraw The Interview before its planned release, it ultimately made it available to view online and allowed it to be shown at some cinemas.
The Interview made about $15 million through downloads alone over its first three days of distribution.
FBI director James Comey says the bureau is confident that North Korea was behind the Sony Pictures cyber-attack last year because the hackers “got sloppy”.
James Comey said the group posted material from servers used exclusively by the North Koreans.
November’s attack on Sony Pictures saw the leak of sensitive documents, and film The Interview briefly shelved.
Cyber security experts have been skeptical about the FBI’s assertion North Korea was to blame.
Sony’s decision to temporarily cancel The Interview‘s release was described by President Barack Obama as “a mistake”. Sony later released the film in independent cinemas and also distributed it online.
The Interview‘s plot revolves around a plan to assassinate North Korean leader Kim Jong-un.
Pyongyang has denied being behind the cyber-attack, but described it as a “righteous deed”.
In retaliation, the US has placed sanctions on three North Korean organizations and 10 individuals.
The sanctions are believed to be the first time the US has moved to punish any country for cyber-attacks on a US company.
James Comey had been addressing delegates at the International Conference on Cyber Security in New York.
He said there was evidence the hackers had used proxy servers in an attempt to disguise the attack’s origins, but sometimes neglected to do so, revealing, the FBI believes, the true location.
However, experts remain unconvinced that the US has proved its case.
“To be frank, director Comey has not revealed anything new,” said Brian Honan, a security researcher.
“Various IP addresses have been associated with this attack, from a hotel in Taiwan to IP addresses in Japan.
“Any IP address connected to the internet can be compromised and used by attackers.”
In his speech at this year’s Consumer Electronics Show (CES) in Las Vegas, Sony CEO Kazuo Hirai has condemned the “vicious” cyber attack that led to it suspending the release of its film The Interview.
The Guardians of Peace hacker group attacked Sony in a bid to stop the release of the movie.
Kazuo Hirai said he was proud of those who stood up against the “extortionist” tactics of the hackers.
“Both Sony, former employees and current employees were the victim of one of the most vicious and malicious cyber attacks in recent history,” said Kazuo Hirai in off-the-cuff remarks made just before Sony’s press conference at CES began.
Speaking to the press, Kazuo Hirai said it would be “remiss” of him if he did not talk about the events of the last few weeks.
Sony has suffered a series of revelations orchestrated by the Guardians of Peace which gained access to the company’s network and stole huge amounts of internal information.
This led to movies being pirated, personal information being shared and millions of private emails published.
The attacks were carried out to convince Sony to halt the release of The Interview – a comedy about journalists recruited to assassinate North Korean leader Kim Jong-un.
The movie’s subject matter led US authorities to blame North Korea for the cyber assault, but many security experts have expressed doubt about this theory.
Sony did withdraw The Interview before its planned release, but it is now available to view online and is on show at some cinemas. It made about $15 million through downloads alone over its first three days of distribution.
“I have to say that I’m very proud of all the employees, and certainly the partners who stood up against the extortionist efforts of criminals, and worked tirelessly, sometimes for days on end to bring you The Interview,” said Kazuo Hirai.
North Korea has attacked new US sanctions in response to a major cyber-attack against Sony Pictures.
The US placed sanctions on three North Korean organizations and 10 individuals after the FBI blamed Pyongyang for the cyber-attack.
North Korea praised the attack on Sony but denied any involvement in it.
It came as Sony Pictures was about to release The Interview, a comedy about a plot to assassinate North Korean leader Kim Jong-un.
Sony initially cancelled plans to screen The Interview, before deciding to release it online and at a limited number of cinemas.
The sanctions imposed on January 2 are believed to be the first time the US has moved to punish any country for cyber-attacks on an American company.
Announcing them, White House officials told reporters the move was in response to the Sony hack, but the targets of the sanctions were not directly involved.
In response, North Korea’s state-run KCNA news agency on January 4 quoted a foreign ministry spokesman as saying: “The policy persistently pursued by the US to stifle the DPRK [North Korea], groundlessly stirring up bad blood towards it, would only harden its will and resolution to defend the sovereignty of the country.
“The persistent and unilateral action taken by the White House to slap <<sanctions>> against the DPRK patently proves that it is still not away from inveterate repugnancy and hostility toward the DPRK.”
US sanctions were already in place over North Korea’s nuclear program but analysts said the new sanctions were designed to further isolate the country’s defense industry.
On January 2, 2015, the White House has announced new sanctions on North Korea in response to a cyber-attack against Sony Pictures Entertainment.
President Barack Obama signed an executive order allowing sanctions on three North Korean organizations and 10 individuals.
The White House said the move was a response to North Korea’s “provocative, destabilizing, and repressive actions”.
US sanctions are already in place over North Korea’s nuclear program.
However, today’s actions are believed to be the first time the US has moved to punish any country for cyber-attacks on an American company.
Among those named in the sanctions were:
The Reconnaissance General Bureau, North Korea’s primary intelligence organization.
North Korea’s primary arms dealer, the Korea Mining Development Trading Corporation (Komid).
Korea Tangun Trading Corporation, which supports North Korea’s defense research.
Jang Song-chol: Named by the US Treasury as a Komid representative in Russia and a government official.
Kim Yong- chol: An official of the North Korean government, according to the US, and a Komid representative in Iran.
Ryu Jin and Kang Ryong: Komid officials and members of the North Korean government who are operating in Syria, according to the US.
White House officials told reporters the move was in response to the Sony hack, but the targets of the sanctions were not directly involved.
Instead, the sanctions are designed to further isolate North Korea’s defense industry as deterrent for future cyber-attacks.
The FBI and President Barack Obama have previously said they believe North Korea was behind the cyber-attack.
North Korea denies involvement in the hack, and some cyber-security experts have also cast doubt on its guilt.
However, a senior White House official said it was extremely rare for the US to attribute cyber-attacks, and it was only done so because of the destructive nature of the attack, and because the White House saw it as “crossing a threshold”.
Sony was embarrassed after a group calling itself Guardians of Peace leaked data from its computers, exposing emails and personal details.
The group later threatened cinema chains planning to screen Sony’s North Korea comedy, The Interview.
References to the 9/11 terror attacks prompted the cancellation of The Interview‘s nationwide release. A small number of independent cinemas did screen the film, and it was released online.
Announcing the new sanctions, the US said the apparent effort to stifle The Interview release was part of the justification for the new restrictions.
“We take seriously North Korea’s attack that aimed to create destructive financial effects on a US company and to threaten artists and other individuals with the goal of restricting their right to free expression,” the White House said in a statement.
“Today’s actions are the first aspect of our response.”
North Korea has blamed the US for lengthy internet outages in the country last week.
North Korea has berated President Barack Obama over the release of The Interview movie in the US.
The Interview is about a fictional plot to kill North Korean leader Kim Jong-un.
North Korea’s National Defense Commission (NDC) also accused the US of shutting down the country’s internet – and used a racial slur to describe the “reckless” Barack Obama.
Sony Pictures had originally pulled The Interview after a cyber-attack and threats.
The company later reconsidered, releasing the comedy on Christmas Day.
A number of critics – including President Barack Obama – had warned that freedom of expression was under threat if the movie was shelved.
The controversial film was shown in some US cinemas and online, with several hundred independent theaters coming forward and offering to show the film. However, larger cinemas decided not screen it.
Kim Jong-un’s potential difficulty is that The Interview – which casts the North Korean leader as a malign, vain buffoon – has been widely reviewed as funny and astute.
In a statement on Saturday, an NDC spokesman denounced the US for screening the “dishonest and reactionary movie hurting the dignity of the supreme leadership of the DPRK [North Korea] and agitating terrorism”.
President Barack Obama, the statement said, “is the chief culprit who forced the Sony Pictures Entertainment to indiscriminately distribute the movie”, blackmailing cinemas in the US.
It added: “Obama always goes reckless in words and deeds like a monkey in a tropical forest.”
The NDC also accused also Washington of “groundlessly linking the unheard of hacking at the Sony Pictures Entertainment to the DPRK”.
Sony Pictures had initially pulled the film after suffering an unprecedented hacking attack at the hands of a group calling itself the Guardians of Peace.
The hackers also threatened to carry out a terrorist attack on cinemas showed the film on its scheduled release date of Christmas Day.
Last week, the FBI said its analysis pointed the finger at North Korea. However, many cyber-security experts have come forward to dispute this assertion.
At the time, North Korea denied being behind the attack but described it as a “righteous deed”.
North Korea subsequently suffered a severe internet outage.
Part of North Korea’s internet services have been restored after an almost unprecedented outage, amid a cyber security row with the US.
Though there has been no comment from the authorities in Pyongyang, US experts reported the restoration.
Some analysts say North Korea’s web access was cut entirely for a time.
Washington said it would launch a proportional response to a cyber-attack on Sony Pictures, which made The Interview comedy about North Korean leader Kim Jong-un.
Officials would not comment on any US involvement in the current outages.
Meanwhile, China’s permanent representative to the United Nations has called for all sides to avoid an escalation of tension on the Korean Peninsula after the UN Security Council put the North’s human rights record on its agenda.
Internet services were partially restored after nine hours and 31 minutes of disruption, cyber security company Dyn Research says.
The website for the state-run Korean Central News Agency (KCNA) and Rodong Sinmun newspaper were back online on December 23.
However, the recovery looked to be partial and potentially unstable with other websites still inaccessible.
Analysts had said technical problems or a cyber-attack could be to blame.
Doug Madory of Dyn Research said they had seen a progressive degradation of North Korea’s connectivity to the outside world until the point at which they were totally offline.
Arbor Networks, an internet technology service, said it had detected denial-of-service attacks against North Korea’s infrastructure beginning on December 20.
Only a small proportion of people have access to the internet in North Korea, one of the world’s most secretive countries.
North Korea’s internet is handled by state-run company Star Joint Ventures, which in turn is routed through Chinese telecommunications firm China Unicom.
Last week, the US government said an FBI investigation had shown that North Korea was behind a hacking attack on Sony, which led to unreleased films and private emails being leaked online. North Korea denied being responsible.
The internet disruption came as the UN Security Council discussed North Korea’s human rights for the first time, despite opposition from China and Russia.
In a fiery statement, North Korea has threatened unspecified attacks on the US in an escalation of a war of words following the Sony Pictures Entertainment cyber-attacks.
North Korea warned of strikes against the White House, Pentagon and “the whole US mainland”.
The communist country denies US claims it is behind cyber-attacks linked to The Interview movie that features the fictional killing of its leader Kim Jong-un.
North Korea has a long history of issuing threats against the US.
The latest statement comes days after the US formally accused North Korea of orchestrating a massive cyber attack on Sony Pictures.
“The army and people of the DPRK [North Korea] are fully ready to stand in confrontation with the US in all war spaces including cyber warfare space,” a long statement carried by the official Korean Central News Agency said.
“Our toughest counteraction will be boldly taken against the White House, the Pentagon and the whole US mainland, the cesspool of terrorism, by far surpassing the ‘symmetric counteraction’ declared by Obama.”
It also accuses President Barack Obama of “recklessly making the rumor” that North Korea was behind the Sony attack.
The statement also said it “estimates highly the righteous action” taken by the hackers of Sony, although it is “not aware of where they are”.
The hack resulted in unreleased films and the script for the next James Bond film being leaked online.
Details of Sony finances and private emails between producers and Hollywood figures were also released.
The eventual fallout from the attack saw Sony cancel the Christmas release of The Interview, a comedy depicting the assassination of North Korean leader Kim Jong-un.
That decision followed threats made by a group that hacked into Sony’s servers and leaked sensitive information and emails.
North Korea has denied being behind the attacks, and offered to hold a joint inquiry with the US.
The US turned down the offer, and President Barack Obama said it was considering putting North Korea back on its list of terrorism sponsors, a move that further angered Pyongyang.
North Korea had been on the US list of state sponsors of terrorism for two decades until the White House removed it in 2008, as part of now-stalled negotiations relating to Pyongyang’s nuclear program.
In an interview with CNN on December 21, Barack Obama promised to respond “proportionately” to the cyber-attack.
“I’ll wait to review what the findings are,” he said, adding that he did not think the attack “was an act of war”.
The US has reportedly also asked China to curb cyber-attacks by North Korea.
China is North Korea’s close ally and is seen as the nation with the most influence over Pyongyang.
Chinese Foreign Minister Wang Yi held a telephone conversation with his US counterpart John Kerry on December 21 in which they discussed the Sony row.
Wang Yi said China was “against all forms of cyber-attacks and cyber-terrorism” but did not refer directly to North Korea.
In a statement posted on China’s foreign ministry’s website on December 22, Wang Yi said that China “opposes any country or person using infrastructure from another country to launch a cyber attack on a third-party country”.
At a later news conference, a foreign ministry spokesman said China wanted to “engage in constructive co-operation with the international community in cyber security on the basis of mutual respect and mutual trust”.
Asked to respond to claims that North Korea was using Chinese facilities for cyber-attacks, the spokesman added: “I think to arrive at any conclusion, sufficient facts and evidence are needed. China will handle the case on the basis of facts, international laws and Chinese laws.”
Correspondents say the issue of hacking is a sensitive one in China-US relations, with the two sides frequently trading accusations of cyber-espionage.
Sony Pictures Entertainment is looking at different channels to release The Interview after scrapping its opening following a cyber-attack blamed on North Korea.
The studio said it had only canceled the film’s Christmas Day release after cinemas pulled out.
Sony said it was considering releasing it “on a different platform”.
President Barack Obama called the cancelation “a mistake”.
North Korea denied involvement and has now urged a joint inquiry with the US.
The FBI said on December 19 that the Pyongyang government was responsible.
The Interview depicts the fictional assassination of North Korean leader Kim Jong-un.
Responding to the president’s comments, Sony Pictures chief executive and chairman Michael Lynton said the studio had not made an error in canceling the release.
“We have not given in, we have persevered,” he told CNN.
A Sony statement said the decision had been based on “the majority of the nation’s theatre owners choosing not to screen the film”.
“Without theatres, we could not release it in the theatres on Christmas Day. We had no choice,” the statement added.
“It is still our hope that anyone who wants to see this movie will get the opportunity to do so.”
Script details, salary data and private email correspondence were leaked in the wake of November’s huge cyber attack.
Hackers then issued a warning referring to the 9/11 terror attacks, saying “the world will be full of fear” if The Interview was screened.
North Korea earlier this month denied allegations that it was responsible for the hack. An article in the state-run KCNA news agency, quoting the country’s top military body, called the suggestions “wild rumor”.
The Interview features James Franco and Seth Rogen as two journalists who are granted an audience with Kim Jong-un.
The CIA then enlists the pair to assassinate him.
The Interview‘s canceled release drew criticism in Hollywood, with some calling it an attack on the freedom of expression.
Sony Pictures Entertainment has confirmed it has no plans to release The Interview movie internationally, in any form, following threats from hackers.
Cinemas in the US canceled screenings of the film, about a plot to kill North Korean leader Kim Jong-un prompting Sony to shelve it altogether.
There has been dismay in Hollywood, with Ben Stiller calling the move “a threat to freedom of expression”.
Hackers had issued a warming to cinema-goers who planned to watch the movie.
President Barack Obama recommended that “people go to the movies”, but stressed that the hack was “very serious”.
Speaking to ABC, the president added: “We’ll be vigilant – if we see something that we think is serious and credible, then we’ll alert the public.”
Several other famous names have criticized the decision to shelve the movie, accusing the studio of caving in to the hackers’ threats.
On December 17, it emerged that Steve Carell’s planned film project, a thriller called Pyongyang about a Westerner working in North Korea, was scrapped ahead of Sony’s announcement.
Sony said it was “deeply saddened at this brazen effort to suppress the distribution of a movie”.
“We respect and understand our partners’ decision and, of course, completely share their paramount interest in the safety of employees and theatre-goers,” the studio said.
It added: “We stand by our film-makers and their right to free expression and are extremely disappointed by this outcome.”
The cancellation comes after hackers calling themselves Guardians of Peace released emails and data stolen from Sony in late November.
In a later warning to cinemas screening The Interview, they referred to the 9/11 attacks, claiming “the world will be full of fear”.
“Remember the 11th of September 2001. We recommend you to keep yourself distant from the places at that time,” the hacker group wrote, in a message on December 16.
“Whatever comes in the coming days is called by the greed of Sony Pictures Entertainment.”
Sony had given theaters in the US and Canada the option to bow out of showing The Interview in the wake of the threats.
Regal Cinemas, AMC Entertainment and Cinemark Theatres – the top three theatre chains in North America – subsequently announced they were postponing screenings, and Canada’s biggest theatre firms also pulled out, leaving Sony seemingly no choice but to postpone the film.
However, the Alamo Drafthouse cinema in Texas has decided to replace The Interview with a screening of Team America, a film featuring a marionette of late North Korean leader Kim Jong-il, the father of Kim Jong-un.