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A federal court in New Jersey has refused to dismiss a company's lawsuit against its insurer seeking to recover a nearly $1 million loss allegedly caused by a hacker.

The Case

In July 2017, The Children' Place, Inc. (“TCP”) asserted that it learned that two payments totaling $967,714.29 had been made to an unauthorized third party (the “Hacker”) instead of to TCP's vendor, Thailand-based Universal Apparel Co., Ltd.

TCP alleged that the Hacker, “through the direct use of a computer, falsified email domain names to appear virtually identical to those of individuals working at Universal”; “accessed and infiltrated Universal's web email service[;] and intercepted emails sent between Universal and TCP.”