While many had hoped that market competition would influence security improvements, customers are forced to accept software as is with no alternatives. Software is responsible for our critical infrastructure, cars, medical devices and is a part of our daily lives including our well-being. Will we be able to achieve better software security without vendors facing financial consequences?
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Software Liability?: The Worst Possible Idea (Except for all Others)
1. SESSION ID:
Software Liability?: The Worst Possible Idea
(Except For All Others)
ASEC-F01
Jake Kouns
Chief Information Security Officer
Risk Based Security
@jkouns
Joshua Corman
CTO
Sonatype
@joshcorman
3. #RSAC
Agenda
Why Liability? Why now?
Product Liability 101
Product Liability Implementation
Why NOT to have Product Liability for Software Vendors
Some Economics
What is Changing the Equation
3
14. #RSAC
Defined
Wikipedia definition:
Product liability is the area of law in which
manufacturers, distributors, suppliers, retailers, and others who
make products available to the public are held responsible for the injuries
those products cause.
Although the word "product" has broad connotations, product liability as an
area of law is traditionally limited to products in the form of
tangible personal property.
26. #RSAC
Ford Pinto (1971 – 1980)
Allegations that the Pinto's structural design allowed its fuel tank filler
neck to break off and the fuel tank to be punctured in a rear-end
collision, resulting in deadly fires from spilled fuel.
27 deaths were attributed to Pinto fires.
According to a 1977 Mother Jones article by Mark Dowie, Ford
allegedly was aware of the design flaw, refused to pay for a
redesign, and decided it would be cheaper to pay off possible
lawsuits.
27. #RSAC
Intended Value and Impact
Companies put a larger emphasis on prevention of issues
Companies put a larger emphasis on testing / precautions
Companies put a culture in place and don’t take unnecessary risks
due to financial impact
Better risk management for the entire company
If a company becomes aware of an issue, they act quickly to correct
30. #RSAC
Liebeck v. McDonald’s Restaurants (1994)
Known as the McDonald's coffee case and the hot coffee lawsuit
A New Mexico civil jury awarded $2.86 million to plaintiff Stella
Liebeck who had suffered third-degree burns in her pelvic region
when she accidentally spilled hot coffee in her lap after purchasing it
from a McDonald's restaurant.
Liebeck was hospitalized for eight days while she underwent skin
grafting, followed by two years of medical treatment.
31. #RSAC
When Product Liability Goes Wrong?
McDonald’s hot coffee is thought to be when legal system goes wrong!
Most actually don’t know the correct full story!
This is really a case of “Failure To Warn”
Documents obtained from McDonald's showed that from 1982 to 1992 the
company had received more than 700 reports of people burned by McDonald's
coffee
Varying degrees of severity, and had settled claims arising from scalding injuries
for more than $500,000.
Questions were asked why was it so hot?
35. #RSAC
Product Recalls
Consumer Products
appliances, clothing, electronic / electrical. furniture, household, children's
products, lighting / lighter, outdoor, sports / exercise
Motor Vehicles and Tires
Child Safety Seats
Food and Medicine
Cosmetics and Environmental Products
36. #RSAC
Software Product Recalls?
When the product is marketed to be secure and it
isn’t how do software vendors handle it?
No more security
patches of fixes
for the product?
38. #RSAC
Software Liability
Software Liability: Our Saving Grace or Kiss of Death?
Debated by Marcus Ranum and Bruce Schneier at RSA 2012
At this point, the issue seems to be still unresolved
With most people being on the side that it is an awful idea
40. #RSAC
Reason #1 - The Worst Possible Idea
Stifle Innovation
New features and ideas would be slow to market due to financials
exposures
Fewer features
Slower time to market
Could hurt competitiveness and/or client satisfaction
41. #RSAC
Reason #2 - The Worst Possible Idea
Barriers to Entry?
Could Hurt Small Businesses and Startups
Large enterprises would easily adjust to additional overhead, but cripple
new and small businesses
42. #RSAC
Reason #3 - The Worst Possible Idea
Economic Impacts
What does this mean to the economy? Potential for massive amount of
money to change hands. The uncertainty alone makes it an awful idea.
“IT” and Software we/are HUGE parts of the US GDP (and growing faster)
43. #RSAC
Reason #4 - The Worst Possible Idea
Vendor Impact
Companies unable to handle the cost
Raise prices
But this is specious for a few reasons:
True Costs and Least Cost Avoiders are more efficient for the system
Hidden Costs and Cost of Ownership changes must be factored
50. #RSAC
Why Aren’t We Improving?
Complexity
Costs
No real impact to end consumer?
No real property or injury type issues?
People just don’t really care?
54. #RSAC
True Costs & Least Cost Avoiders
ACME
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
58. #RSAC
True Costs & Least Cost Avoiders
ACME
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
59. #RSAC
True Costs & Least Cost Avoiders: Downstream
ACME
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
61. #RSAC
True Costs & Least Cost Avoiders
ACME
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
Enterprise
Bank
Retail
Manufacturing
BioPharma
Education
High Tech
64. #RSAC
Reliance On Poor Software
Poor software with security issues in
the new Internet of Things world can
now lead to:
• Bodily Injury
• Property Damage
• Financial Harm
65. #RSAC
Product Liability Is Already Here
Its not the software that hurts the people, it’s a component of a larger
finished product, making it a product failure not just the software.
MacPherson v. Buick Motor Co., 217 N.Y. 382, 111 N.E. 1050 (1916)
Donald C. MacPherson was injured when one of the wooden wheels of his
1909 "Buick Runabout" collapsed
Buick Motor Company, had manufactured the vehicle, but not the wheel, which
had been manufactured by another party but installed by defendant.
Software responsibility is going to be on final good manufacturer (no
matter what) that is delivering the final product
66. #RSAC
Product Liability Is Already Here
The important portion of the MacPherson opinion:
“If the nature of a thing is such that it is reasonably certain to place
life and limb in peril when negligently made, it is then a thing
of danger. Its nature gives warning of the consequence to be expected. If to
the element of danger there is added knowledge that the thing will be used by
persons other than the purchaser, and used without new
tests, then, irrespective of contract, the manufacturer of
this thing of danger is under a duty to make it carefully.
That is as far as we need to go for the decision of this case . . . . If he is
negligent, where danger is to be foreseen, a liability will follow”
69. #RSAC
Financial Liability For Data Breach Already Exists
“Enhanced security
and manageability
via comprehensive
and flexible access
and authorization
control”
70. #RSAC
Expansion Of Liability Is Likely Coming
Liability already exists due to a data breach
Currently on the company that had the breach regardless if it was the fault
of a software product they purchased and expect security in place
Large companies can handle the costs, however, small businesses
filing for bankruptcy
Doing everything right but the software they purchased with an
expectation to be secure isn’t
Is this right?
71. #RSAC
Not from Whole Cloth
UL for electronics
NTSB & ASRS for aviation
NHSTB? or NHTSA? for vehicles
FDA & DHS ICS-CERT for medical
FCC for “radio controlled”
FTC for enforcement
SEC for publically traded
Consumer Reports?
72. #RSAC
Taking Care: Incentives Incentivize (Perversely)
Let’s NOT recreate PCI DSS
Outcomes over Inputs (Control Objectives over Controls)
Visibility to support Free Market Forces and Choice
Filter on “With the potential to affect human life and public safety”
Due Care / Negligence / Reasonability
Software must be “Patchable”
HDMoore’s Law (and/or OWASP Top 10?)
We had better know what we really want to incentivize…
73. #RSAC
Yes… HDMoore’s Law (Bellis & Roytman [&Geer])
73
“Punchline: Using CVSS to steer remediation is
nuts, ineffective, deeply diseconomic, and
knee jerk; given the availability of data it is
also passe’, which we will now demonstrate.”
-Geer/Roytman
74. #RSAC
How Could Software Liability Work?
Not be prescriptive on what needs to be done / security implement
Allow for the concept of liability to exist in software world
Not just for tangible products
Not just for Bodily Injury / Property Damage
Ensure security is not the last items on the priority list (new features
FTW)
75. #RSAC
The EULA Elephant in the Room…
EULAs may be the primary
obstacle
These 1 sided contracts cannot be
overlooked
EULA Reform may be close
E.g. No more than 1 page of plain
speak
76. #RSAC
Things you can do
Investigate/Join “The Cavalry” @iamthecavalry
Public Safety & Human Life
Watch
Hot Coffee
Reading:
Geekonomics by David Rice
Therac-25 History
76
78. SESSION ID:
Software Liability?: The Worst Possible Idea
(Except for all Others)
ASEC-F01
Jake Kouns
Chief Information Security Officer
Risk Based Security
@jkouns
Joshua Corman
CTO
Sonatype
@joshcorman
IMG SRC: http://circa71.files.wordpress.com/2010/08/cuy-river-fire1.jpgIn 1969, the Cuyahoga River in Ohio caught on fire and stayed on fire….….it took this to finally get serious discussion about pollution.We believe a similar trigger will likely be required to cause SW Liability and/or significant criminalization of research changes.
Photo taken by Speaker – Joshua Corman
http://www.forbes.com/sites/andygreenberg/2013/07/24/hackers-reveal-nasty-new-car-attacks-with-me-behind-the-wheel-video/WATCH THE VIDEOhttp://www.scmagazine.com/researchers-shed-light-on-car-hacking/article/320604/
Comic relief to Kevin’s conversation with Josh RE: BlueTooth on Insulin pumps.“Everything’s better with bacon? Everything’s better with BlueTooth” – Kevin FuIMG SRC:http://beekn.net/2013/12/bluetooth-le-arduino-wifi-android/
http://en.wikipedia.org/wiki/Product_liabilityIssues or claims most commonly associated with product liability are:LiabilityBreach of warrantyNegligenceConsumer protectionStrict liability
Manufacturing: explore “Poor quality materials” [sic open source code with known CVE over X at the time(window) of release]Manufacturing: explore “shoddy workmanship” as things like: No published SDLC, No 3rd party Scan, Violating OWASP Top10, ____, ____Manufacturing defects are those that occur in the manufacturing process and usually involve poor-quality materials or shoddy workmanship.
Design: explore expectations of “safe” in context of OWASP? 3rd party testing? 5 star crash testing?Design: risks outweigh the benefits could be worked but could be tricky. The BlueTooth stack on insulin pump over MUCH safer direct wireDesign defects occur where the product design is inherently dangerous or useless (and hence defective) no matter how carefully manufactured; this may be demonstrated either by showing that the product fails to satisfy ordinary consumer expectations as to what constitutes a safe product, or that the risks of the product outweigh its benefits.
Warn: perhaps some sort of ongoing monitoring of the 3rd party and open source code ingredients you’ve used (e.g.)Failure-to-warn defects arise in products that carry inherent nonobvious dangers which could be mitigated through adequate warnings to the user, and these dangers are present regardless of how well the product is manufactured and designed for its intended purpose.
Warn: perhaps some sort of ongoing monitoring of the 3rd party and open source code ingredients you’ve used (e.g.)Failure-to-warn defects arise in products that carry inherent nonobvious dangers which could be mitigated through adequate warnings to the user, and these dangers are present regardless of how well the product is manufactured and designed for its intended purpose.
Warn: perhaps some sort of ongoing monitoring of the 3rd party and open source code ingredients you’ve used (e.g.)Failure-to-warn defects arise in products that carry inherent nonobvious dangers which could be mitigated through adequate warnings to the user, and these dangers are present regardless of how well the product is manufactured and designed for its intended purpose.
Warn: perhaps some sort of ongoing monitoring of the 3rd party and open source code ingredients you’ve used (e.g.)Failure-to-warn defects arise in products that carry inherent nonobvious dangers which could be mitigated through adequate warnings to the user, and these dangers are present regardless of how well the product is manufactured and designed for its intended purpose.
Warranties are statements by a manufacturer or seller concerning a product during a commercial transaction. Breach of warranty-based product liability claims usually focus on one of three types: breach of an express warrantybreach of an implied warranty of merchantabilitybreach of an implied warranty of fitness for a particular purpose.
Physical injury is the keen focus of the cavalry as we hone down the scopeLemon Laws made need exploration later as signaling to overcome Info Asymmetry and suboptimal outcomes for “both/all” parties Many states have enacted consumer protection statutes providing for specific remedies for a variety of product defects. Statutory remedies are often provided for defects which merely render the product unusable (and hence cause economic injury) but do not cause physical injury or damage to other property; the "economic loss rule" means that strict liability is generally unavailable for products that damage only themselves. The best known examples of consumer protection laws for product defects are lemon laws, which became widespread because automobiles are often an American citizen's second-largest investment after buying a home.
The National Highway Traffic Safety Administration (NHTSA) ultimately directed Ford to recall the Pinto.
Documentary on this called Hot CoffeeFree refills of coffee were offered and it was decided to make it so hot so they couldn’t drink it fast enough to need refills.
The marketers of Sensa, a weight-loss powder sprinkled on food, will pay $26.5 million to settle agency charges that the company made unfounded weight-loss claims and used misleading endorsements
When products do not work as expected, orgs are expected to make it right, in terms of recalls and correcting as their cost, not to the consumer
When products do not work as expected, orgs are expected to make it right, in terms of recalls and correcting as their cost, not to the consumerHow would it be if a car company said support was EOL? No more recalls / fixes
Fair amount of discussion on this topic with two extreme sidesRSA debate: http://www.youtube.com/watch?v=5rSScJinPoQ (The goal was to solve and resolve this issues once and for all)
There are lots of ideas here, this isn’t a straight forward issuesLots of complexity, however, we are going to highlight a few of the points most frequently used as reason it is a bad idea.
SOURCE:http://www.youtube.com/watch?v=hXC9FI1nAqsMight not be the best pne, but had a good visual to screen shot.Basic point is:Destruction is notstimulative. Hidden costs/impacts and Opportunity Costs
Image from http://www.davenussbaum.com/adapting-to-change/
Image from http://www.davenussbaum.com/adapting-to-change/
Image from http://www.davenussbaum.com/adapting-to-change/
Everyone knows the Target data breach. It was a PoS system that was hacked. Was is really Target’s fault? Target’s U.S. stores, but multiple sources say U.S. stores have traditionally used a home-grown software called Domain Center of Excellence. We know Target is going to pay.
Target Rolling out Retalix in place of home grown system. It advertises its product as “Enhanced security and manageability via comprehensive and flexible access and authorization control” If the breach occurred and it was Retalix security issue… who pays?
We need to help shape it now and stop saying it isn't a good solution
http://blog.cognitivedissidents.com/2011/11/01/intro-to-hdmoores-law/http://blog.risk.io/2013/08/stop-fixing-all-the-things-bsideslv/See also the Dan Geer & Mike Roytman USENIX White Paper on this:https://www.usenix.org/system/files/login/articles/14_geer-online_0.pdf
http://www.iamthecavalry.org18m TEDx for the Cavalry “Swimming w/ Sharks: Security in the Internet of Things”http://www.youtube.com/watch?v=rZ6xoAtdF3ohttp://www.amazon.com/Geekonomics-Real-Insecure-Software-paperback/dp/0321735978