CrowdStrike is being sued by its shareholders over a faulty software update that caused a global IT outage, affecting more than eight million computers. The lawsuit claims the company made “false and misleading” statements about its software testing.
The suit alleges that CrowdStrike executives defrauded investors by making them believe the company’s software updates were adequately tested. It also states that the company’s share price dropped 32% after the incident, causing a loss in market value of $25 billion.
CrowdStrike denies the allegations and plans to defend itself against the proposed class action lawsuit. The company claims it has fixed the issue and computers affected by the outage are now back to normal.
The lawsuit is seeking an unspecified amount of compensation for investors who owned CrowdStrike shares between November 29 and July 29. Delta Air Lines’ CEO, Ed Bastian, has also stated that the disruption caused by the outage cost the airline $500 million.
CrowdStrike attributes the issue to a “bug” in its software update system, which allowed “problematic content data” in a file to go undetected. The company claims it can prevent a repeat of the incident with better software testing and checks.
Source: https://www.bbc.com/news/articles/cy08ljxndr4o