In a case being closely watched by general counsel, a federal judge ruled this week that the Federal Trade Commission (FTC) has the authority to take legal action against companies that have faulty security practices for consumer data.

“The FTC can now speak with an authoritative tone on what amounts to reasonable data-security practices. Inside and outside counsel will have to listen,” attorney Michael Cowie told Cowie, a partner at Dechert in Washington, D.C., is a former assistant director and senior litigation counsel at the FTC.