[ad_1]
Former FBI Chief Information Officer Gordon Bitko reacts to Solarwinds hackers accessing Microsoft’s source code.
A SolarWinds shareholder filed a class action lawsuit on Monday in U.S. District Court for the Western District of Texas against company president Kevin Thompson and CFO J. Barton Kalsu, claiming executives violated federal laws on securities under the Securities Exchange Act of 1934.
SOLARWINDS HACKERS CONSULTED THE MICROSOFT SOURCE CODE
The lawsuit alleges that SolarWinds management “misrepresented and failed to disclose” information about the company’s recent hack, causing a “sharp drop in the market value of the company’s securities” which resulted in “significant loss and damage For investors who bought shares between February 24 and December 15, 2020.
The lawsuit says SolarWinds either misrepresented or failed to disclose to shareholders that the company’s Orion monitoring products had a vulnerability since mid-2020 that allowed hackers to compromise the product’s server and the update server SolarWinds had an easily accessible password of “ solarwinds123 ” that would make customers including the Federal Government, Microsoft, Cisco and Nvidia vulnerable to hacks.
In addition, the misleading representations caused the company and its shareholders “material damage to their reputation” and an “artificially inflated” market price of SolarWinds.
| Teleprinter | security | Latest | Change | Change% |
|---|---|---|---|---|
| SWI | SOLARWINDS CORPORATION | 14.53 | -0.42 | -2.81% |
Shareholders claim that management had “actual knowledge of material omissions and / or the falsity of material statements” and intended to “mislead the plaintiff and other class members, or, alternatively, acted with it. a reckless disregard for the truth when they have failed to verify and disclose the actual facts in statements made by themselves or by other SolarWinds staff to members of the investing public. “
“If the Plaintiff and the other members of the Class had known that the market price of the SolarWinds securities had been artificially and falsely inflated by the misleading representations of the Defendants and by material adverse information which the Defendants did not disclose, they did not would not have bought the SolarWinds titles at the artificially inflated prices they did, or not at all “, adds the lawsuit.” As officers and / or directors of a public company, individual defendants had a duty to broadcast accurate and truthful information regarding SolarWinds’ business practices, and promptly correct any public statements made by SolarWinds that have become materially false or misleading. “
The lawsuit seeks unspecified damages for “reasonable costs and expenses incurred,” including attorney and expert fees, as well as any additional relief the court deems appropriate.
CLICK HERE TO LEARN MORE ABOUT FOX BUSINESS
In addition to shareholders, at least 18,000 SolarWinds customers were affected by the hack, including many Fortune 500 companies and many government agencies. U.S. intelligence officials blamed Russia, but the Kremlin denied any involvement.
A spokesperson for SolarWinds did not comment directly on the lawsuit, but told FOX Business it was “only focused on helping industry and our customers to understand and mitigate this attack,” noting that ‘He quickly released updates to customers that he said “will address the vulnerability.”
“We are working closely with federal law enforcement and intelligence agencies to investigate the full scope of this unprecedented attack, including whether it was backed up by foreign government resources,” the spokesperson added. word. “We are also working with leading third-party cybersecurity experts to help investigate, mitigate and correct this attack.”
Additionally, the company said it has taken a number of steps to further secure its network and products, including through advanced endpoint detection and monitoring tools.
GET FOX BUSINESS ON THE ROAD BY CLICKING HERE
The company’s shares have fallen more than 34% since news of the attack broke. Additionally, Truist Securities and Baird both downgraded SolarWinds stock from buy to own, with both also predicting stock price targets to drop to around $ 15. The stock closed at $ 14.53 per share at the end of Monday’s trading session.
Paul Best of Fox Business contributed to this report.
[ad_2]
Source link