This chapter explores the ways in which personal data and digital assets might be misused by strangers and third parties in the context of asset management. As global asset management markets move increasingly to handling investments with the aid of autonomous platforms and algorithms, it is important to be able to identify entities, investors and their agents. Decision-making and transactions need to be trackable. Asset and wealth managers also gather, store and use the personal information of their customers. At the heart of these arrangements is trust. However, the threat of cyberattack or systemic failures gives rise to the question of who should be made liable when losses arise from malicious or negligent data breaches. Often, it is not possible to identify a nefarious individual. Importantly, in the context of asset management, liability for knowing receipt, knowing dealing or knowing assistance may attach to persons dealing with trustees and other types of fiduciaries. This is not an area of law to which a universal regime of absolute liability applies. For this reason, it is useful to identify types of risk and the means to address them.

The fiduciary may not be the only person who is accountable for a breach of fiduciary obligation. Other parties may also be liable. Suppose a solicitor misappropriates client money and then pays it into his wife’s bank account. The solicitor might also have been helped to commit the breach by an accountant who gave the solicitor access to the client account. Will these third parties – the wife and accountant – be liable in equity for their participation in the fiduciary’s breach? If the solicitor is solvent, the answer to this question may not matter much. The solicitor will be ordered to restore the money to the fund, together with compound interest to compensate for the loss of investment opportunity caused by the misappropriation. But if the solicitor is insolvent, the client will look to other participants in the fraud with ‘deep pockets’ to recover her funds.

Judge Richard Posner’s opinion in McCarty v. Pheasant Run, Inc. exemplifies his use of a law and economics approach in tort cases. Applying the famous risk–utility test found in the “Hand formula,” Posner refused to impose negligence liability on a hotel in a case in which a woman was assaulted by an unknown assailant who gained access to her room through an unlocked door that opened into a courtyard. The rewritten feminist dissent objects to the use of the risk–utility test in sexual violence cases where the “loss” being quantified (i.e., a deprivation of personal autonomy) is often undervalued and misunderstood. To eliminate the risk of victim-blaming, the feminist opinion would change the law to disallow a contributory negligence defense to limit a plaintiff’s recovery in cases of rape and sexual assault. The accompanying commentary discusses how Judge Posner’s rhetoric and his law and economic philosophy leads him to weigh the economic interests of businesses over women’s physical and emotional well-being.

Sharon P. v. Arman, Ltd. is representative of a line of cases refusing to impose a duty of reasonable care on defendants in third-party rape cases. The plaintiff in Sharon P. was raped by an unknown assailant in an underground parking garage owned by the defendant. The California Supreme Court ruled that no duty should be imposed because the rape was not reasonably foreseeable, even though conditions in the garage had been allowed to deteriorate and the underground location invited criminal activity. The rewritten feminist opinion unpacks the concept of foreseeability to uncover hidden male bias in its application. Arguing that women’s experiences of rape and the fear of rape must be taken into account, the feminist opinion concludes that the risk of rape is objectively foreseeable. To conclude otherwise would ignore the systematic vulnerability of women plaintiffs and allow gender bias to infiltrate tort law. The accompanying commentary updates developments in California and elsewhere and argues for extending a duty of reasonable care to all third-party rape cases.

Tarasoff v. Regents of University of California is a famous and still controversial decision by the California Supreme Court that held that a campus psychotherapist owed a duty to warn a woman whom his patient had threatened to kill. When the patient carried out his threat, the victim’s family sued the University, claiming that the therapist and campus police failed to exercise reasonable care to protect their daughter. The rewritten feminist opinion goes beyond the original majority opinion and imposes a duty on both the therapist and the campus police. It reveals the full story of the Berkeley student’s stalking and delusional romance with the victim and reframes the case as one of gender violence. Under the feminist judgment, victims of domestic violence would have a right to call on the state for protection against physical harm. The accompanying commentary explains the struggle on the California Supreme Court and the difficulties of holding law enforcement accountable in sexual and domestic violence cases.