Source: https://www.lrrc.com/Casino-Player-Clubs--Nevadas-Data-Protection-Requirements-12-01-2013
Timestamp: 2017-04-25 00:50:12
Document Index: 20755820

Matched Legal Cases: ['§ 7001', '§ 603', '§ 603', '§ 603', '§603', '§ 603', '§ 603', '§603', '§ 603', '§ 603', '§ 603', '§ 603', '§ 603', '§ 603', '§603', '§ 603', '§ 603', '§ 603']

Casino Player Clubs & Nevada's Data Protection Requirements | Lewis Roca Rothgerber Christie LLP
Casino Player Clubs & Nevada's Data Protection RequirementsDecember 2013
©2013 All Rights Reserved Casino Enterprise Management
(8)Failure to comply with or make provision for compliance with all federal, state and local laws and regulations pertaining to the operations of a licensed establishment including, without limiting the generality of the foregoing, payment of all license fees, withholding any payroll taxes, liquor and entertainment taxes, and antitrust and monopoly statutes.”3
To begin, any business in Nevada that maintains records that contain PI concerning customers is required to take reasonable measures to ensure the destruction of those records when the business decides that it will no longer maintain the records.5 This requirement is noteworthy for three reasons. First, the term “business” is defined as a “proprietorship, corporation, partnership, association, trust, unincorporated organization or other enterprise doing business in this state.”6 This term is expansive and clearly includes Nevada casinos. Second, unlike some jurisdictions, Nevada does not require a business to destroy PI after a certain period of time. Instead, it allows the business to subjectively determine when it no longer requires the PI. Third, the phrase “reasonable measures to ensure the destruction” is also broadly defined as:
“any method that modifies the records containing the personal information in such a way as to render the personal information contained in the records unreadable or undecipherable, including, without limitation: (1) shredding of the record containing the personal information or (2) erasing of the personal information from the records.”7
Chapter 603A also imposes several security requirements upon data collectors. The term data collector is defined as “any governmental agency, institution of higher education, corporation, financial institution or retail operator or any other type of business entity or association that, for any purpose, whether by automated collection or otherwise, handles, collects, disseminates or otherwise deals with nonpublic personal information.”8 Again, this term is expansive and unquestionably includes casinos that collect and store PI as part of their player clubs. The security requirements imposed in Chapter 603A include: (i) the maintenance of reasonable security measures, (ii) encryption of PI in transmission and on data storage devices and (iii) disclosure of security breaches impacting the PI of Nevada residents.
Specifically, a data collector that maintains records that contain PI of a resident of Nevada is required to implement and maintain reasonable security measures to protect those records from unauthorized access, acquisition, destruction, use, modification or disclosure.9 Additionally, any contract for the disclosure of PI maintained by a data collector must also include a provision requiring the person to whom the information is disclosed to implement and maintain reasonable security measures.10 Chapter 603A does not define, however, what constitutes “reasonable security measures.” Rather, security measures under this chapter are measured against a standard based on the circumstances of the data collector, the threat environment, available technology, etc. A common factor that data protectors often rely upon to ensure “reasonable security measures” is compliance with industry standards. A data protector must be mindful in this regard, however, as compliance with industry standards may not always be “reasonable,” especially if the industry is lagging in this respect.
In addition to the maintenance of reasonable security measures, Chapter 603A imposes requirements upon the encryption of PI.11 In particular, a data collector doing business in Nevada must use encryption for: (i) all electronic transfers of PI, unless transferred via facsimile, to any person outside of the secure system of the data collector and (ii) any movement of a data storage device containing PI beyond the logical or physical controls of the data collector or its data storage contractor.12 With regard to this latter requirement, most states’ PI laws consider it a security breach when a data storage device containing unencrypted PI is lost. However, Nevada goes one step further and effectively makes it a security breach to remove a data security device containing unencrypted PI from the control of the data collector. Moreover, the definition of “data storage device” is expansive and means “any device that stores information or data from any electronic or optical medium, including, but not limited to, computers, cellular telephones, magnetic tape, electronic computer drives and optical computer drives, and the medium itself.”13 This places a heavy burden on a casino to monitor its employees’ use of cell phones, laptops, thumb drives and other data storage devices that can be loaded with unencrypted PI and taken off the premises.
(ii) Electronic notification, if the notification provided is consistent with the provisions of the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. §§ 7001 et seq.
Moreover, if a data collector determines that notification is required to be given to more than 1,000 persons at any one time, the data collector shall also notify, without unreasonable delay, any consumer reporting agency that compiles and maintains files on consumers on a nationwide basis, of the time the notification is distributed and the content of the notification.17 The privacy of PI is increasingly important in today’s electronic world. As such, casino operators bear a heavy burden to protect such information collected in conjunction with their player clubs. By failing to adhere to these burdens and appreciate their societal significance, a casino can expect significant public backlash, severe fiscal consequences and the ire of the board and commission.
1 See State Gaming Control Board Industry Letter Re: Federal and State Laws Pertaining to Security Measures Required By Data Collectors And Disclosure Requirements Should Said Information Become Breached, December 15, 2010. http://gaming.nv.gov/modules/showdocument.aspx?documentid=5571
2 Nev. Rev. Stat. § 603A.040.
5 Nev. Rev. Stat. § 603A.200(1).
6 Id. at § 603A.200(2)(A).
7 Id. at §603A.200(2)(B).
8 Id.at § 603A.030. (Emphasis added)
9 Id. at § 603A.210(1).
10 Id. at §603A.210(2).
11 See id. at § 603A.215(2).The definition of “encryption” is open-ended and means “the protection of data in electronic or optical form, in storage or in transit, using: (1) An encryption technology that has been adopted by an established standards setting body, including, but not limited to, the Federal Information Processing Standards issued by the National Institute of Standards and Technology, which renders such data indecipherable in the absence of associated cryptographic keys necessary to enable decryption of such data; (2) Appropriate management and safeguards of cryptographic keys to protect the integrity of the encryption using guidelines promulgated by an established standards setting body, including, but not limited to, the National Institute of Standards and Technology; and (3) Any other technology or method identified by the Office of Information Security of the Division of Enterprise Information Technology Services of the Department of Administration in regulations adopted pursuant to NRS 603A.217.” Id.at § 603A.215(5)(b).
12 Id. at § 603A.215(2). Note: NRS 603A.215(1) also requires businesses that accept credit or debit cards to meet the Payment Card Industry Data Security Standard.
13 Id. at § 603A.215(5)(a).
14 Id. at § 603A.220(1). Similarly, if the data collector does not own the PI, it must notify the owner or licensee. See id. at § 603A.220(2).
15 Id. at §603A.220(4).A data collector is also deemed to be in compliance if it abides by internal policies consistent with the timing requirements of Chapter 603A or, if subject to the Gramm-Leach Bliley Act, complies with the privacy and security provisions contained therein. See id.at § 603A.220(5).
16 Id. at § 603.220(4).
17 Id. at § 603A.220(6).
Glenn J. LightPartnerglight@​lrrc.com702.949.8276
Karl F. RutledgePartnerkrutledge@​lrrc.com702.949.8317