Seven restaurants have filed a lawsuit against Georgia-based Radiant Systems for failing to protect its point-of-sale systems from a hacker.

“The suit alleges that the system stored all the data embedded on the bank card magnetic stripe after the transaction was completed—a violation of industry security standards that made it a high-risk target for hackers,” writes Wired’s Kim Zetter. “Also named in the suit is Computer World, a Louisiana-based retailer, which sold and maintained Radiant’s Aloha POS system.”

“The restaurants are seeking millions in damages to recover their costs from the breach,” Zetter adds. “These include fines levied against them from Visa and other credit card companies for failing to be PCI-compliant, the cost of forensic audits to uncover the source of the breach, chargebacks to cover fraudulent charges made on customer accounts, and reimbursements to card providers who had to issue new customer cards.”

Click here to read the Wired story.