Langmeier Backup Magazine

In today’s digital landscape, especially within larger organizations, vast amounts of data are generated daily as part of routine business operations. This data is typically managed and processed using sophisticated IT systems. The value of such data depends primarily on its type and the specific benefits it provides to the company.

Unlike physical assets, data does not possess inherent material value. Whether stored optically on a CD or DVD, or magnetically on a hard drive, data remains intangible and invisible without the aid of a computer. In many cases, data is unique and, if lost, can be irretrievable. This applies not only to technical drawings, manuscripts, and expert reports, but also to personal files such as vacation or wedding photos.

When data is permanently lost within a company, the question of liability and appropriate compensation quickly arises. Under German tort law, a distinction is made between compensation and restoration. In principle, the law requires the responsible party to compensate for damages by restoring the original state. This means the liable party must either repair the damage themselves or cover the costs necessary for restoration. For example, this could include the fees charged by a data recovery service to retrieve lost data.

However, if the data is irretrievably lost and cannot be restored by any means, this approach reaches its limits. In such cases, no amount of money can restore the original data. Nevertheless, this does not automatically absolve the responsible party from their obligation to provide compensation. Instead, due to the impossibility of restoration, monetary compensation is owed, calculated according to the so-called difference hypothesis.

This method determines the difference between the injured party’s financial situation after the damaging event and their hypothetical financial situation had the event not occurred. According to this calculation, compensable damages include the costs incurred to reconstruct lost, unrecoverable data from memory, as well as additional time and personnel expenses resulting from disrupted business processes. Loss of profit is also considered compensable damage.

It is important to note that only consequential damages and loss of profit are eligible for compensation. The lost data itself is not assigned a direct monetary value. This distinction is particularly relevant for private files, such as digital vacation photos. While the loss of such files is undoubtedly frustrating for those affected, it does not constitute material damage in the legal sense. As a result, private individuals generally cannot expect to receive compensation in the event of data loss.

Even companies that suffer significant losses due to data destruction are not automatically entitled to compensation. If a company fails to back up its data regularly, it may be considered at least partially responsible for the loss. Therefore, it is essential that business-critical data is stored in multiple copies across different storage media. Neglecting this precaution may result in the injured party bearing the entire loss.

Now more than ever, companies must recognize that their data represents a valuable asset and deserves special protection. Evaluating data from a business perspective enables organizations to select the right technologies for data security—striking a balance between adequate protection and efficient resource allocation, without neglecting critical company information.

Look it up further: Data loss

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