Avoiding Disaster: Legal Liability and App Performance Monitoring and Management

The global number of both mobile and website apps has exploded as more consumers seek technological solutions to their problems through their digital devices.

 
However, like any product, an ‘app’ – a digital application that provides a specific function for the user – can fail, and in that failure cause injury, damages, or both. As more apps fail, more users suffer, and those suffering users are beginning to look to the apps’ developers for compensation. In many cases, dedicated application performance monitoring may have identified what was causing substandard app performance in time to prevent legal risk exposure.

More Apps = More Problems

The application development industry continues to grow as evolving nuances build on past successes to offer more and more varied solutions to everyday challenges. Research indicates that the number of mobile apps downloaded globally grew from just over 140 billion in 2016 to over 230 billion in 2021. Consequently, the global community now relies on digital technology to facilitate huge segments of daily life, from banking to shopping to healthcare and beyond.

While humans remain (in most cases) the drivers of those webs of software applications, automated software programming controls most of the complex digital networks functioning into which they are wired. And it is the failures that occur within that network complexity that are beginning to cause legal problems for system owners.

Two instances reveal the chaos that can occur when apps go wrong.

• The French bank CLC experienced significant embarrassment and potential liability in February 2021 when its users logged onto its website and into other users’ accounts. A software error caused the glitch and was quickly fixed but not before potentially hundreds of customers had the opportunity to peruse the private accounts of their banking neighbors. While the bank declared that no customer had suffered any loss or damage due to the internal gaffe, the digital community noted that hackers may have already absconded with the private records of thousands of CLC clients.

 
From a legal perspective, every patron whose account was exposed now has a privacy violation claim against the bank (although they must also prove that they were somehow damaged because of that exposure to be successful in court). The bank may also be responsible for losses caused to those who had their private information stolen if that indeed occurred. And the bank was forced to scramble to clean up its own liability mess to avoid being fined by E.U. privacy law regulators.

• Another 2021 exampled occurred in the state of Arizona where prison inmates were detained longer than legally allowed when the State failed to update its algorithms to accommodate a 2019 law change. The law permitted inmates to reduce their sentences by as much as 30% when they participated in rehabilitative services such as GED classes or substance abuse treatment. Initial inspections made within days of the error discovery indicated that more than 700 inmates were still not enrolled in the new program. Potentially hundreds more, if not thousands, might also be affected since Arizona’s imprisonment rate is the fifth-highest in the country, and there are ostensibly many more inmates who qualify for the new treatment. Moreover, the software responsible for the glitch is also responsible for more than 14,000 other bugs discovered since its launch in late 2019.

 
From a legal perspective, every inmate who wasn’t enrolled promptly and ‘suffered’ a longer prison sentence than necessary may have a legal claim against the state for that lost time out.

Potential Liabilities Abound

End-user privacy claims are an apparent legal risk exposure when a corporate application fails to protect its users’ privacy rights. The U.S. Federal Trade Commission (FTC) identifies ‘mobile privacy’ as a critical enforcement priority and encourages state Attorney Generals to maintain a close eye on cases arising from negligent or intentional digital exposures. The concern is especially significant in specific industries that routinely access private and privileged information, such as banking and healthcare, to name just two.

Other potential legal exposures can arise when proprietary apps fail.

• Violating intellectual property (I.P.) rights can trigger a legal claim. Each app generates its own I.P. rights that accrue to its developers and owners. U.S. copyright law protects source code as copywritten material, some of which may also qualify as ‘trade secrets.’
• Web-based and mobile apps also trigger advertising regulations reviews and must comply with the Telephone Consumer Protection Act (TCPA) and the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (CAN-SPAM), to name just two. In this legal realm, liability can also arise when apps are functioning correctly, so programming them to avoid that risk is a critical corporate obligation. When those apps also contain bugs and errors that aren’t readily apparent, companies can find themselves exposed to more significant legal perils.

One way to prevent your proprietary app from inadvertently triggering a legal liability claim is to monitor and manage its performance and functioning closely. Yes, high levels of quality testing during its development and launch are also crucial, but maintaining that level of oversight once it’s released into the marketplace is also a prudent and essential step in reducing liability risk exposure.

The extensive app development team at Datavail can help you evaluate the functioning of your apps and then monitor those functions to ensure they stay within all guidelines and regulations. The service also frees up your IT teams to focus on more significant corporate concerns.

There’s too much at stake these days to risk any loss; let Datavail help mitigate the risk of loss for your organization. For a real-world example of our application performance management services in action, download the case study, Application Performance Management: Keeping the World Rolling, to learn how Datavail helped a manufacturing company keep their business-critical applications up and running.