Brief cases 1-4 are based on the following information.
Digital Currency Trading, LLC (DCT) sells professional video equipment via the Internet to
customers all around the world. DCT suffered an cyber-attack. The perpetrator, a foreign national
living in the United States was arrested and Federal Assistant U.S. Attorneys are handling the
criminal charges against the perpetrator.
The perpetrator has a wealthy family and has the deep pockets to compensate DCT for its losses
associated with the attack. The perpetrator committed the act at 12:01 am Monday, May 4th and
the sales website was down for 16 hours. At 12:01 am alarms triggered and the Director of
Information Technology (IT) and ten IT programmers worked unplanned 20 hours to restore and
remediate the attack.
1. and 2. VVI's supervisor from information technology and an accounting clerk have assembled the
following lists of costs:
The IT Director earns a salary of $225,000 annually.
Each IT person earns $90 per hour; IT personnel work scheduled shifts to provide 24-hour coverage;
each of the ten IT programmers had worked 40 hours the prior week and worked their scheduled 40
hours the week after the incident, plus an extra 20 hours of 1.5 times overtime to remediate the
damage.
The companies cost for benefits is approximately 35%.
The Federal attorneys believe that the perpetrator worked alone, but his daughter-in-law works for
DCT IT and earns $125 per hour and is normally scheduled for 40 hours per week. She averages 10
hours of overtime each week.
The company put the daughter-in-law on paid-administrative leave starting, Monday, May 11th. She
was paid administrative leave until police arrested her father-in-law on June 8, four weeks later. The
daughter-in-law and DCT worked out an "exit" compensation package, where the daughter resigned
immediately on June 8 and was paid for her expected earnings for an additional 20 weeks.
IT Department utilities and non-personnel operational costs for the month of the attack were
approximately on budget of $250,000, though 5% higher than the prior year. Operational costs
equal $875 per hour during the month of July.
As part of the remediation process, the company purchased a redundant server. The cost of the
server, peripherals and software totaled $125,000.
After the attack, the company purchased a new software protection package for $400,000 to
prevent future attacks, similar to then May 4th attack.
1) Assuming that ALL costs above are damages, estimate incremental costs to DCT.
2) Assuming that true incremental costs to remediate and restore the internet website are
damages, estimate incremental costs to DCT.
