Delta CEO says CrowdStrike IT outage will cost airline $500m — as tech firm also sued by shareholders
Delta has “no choice” but to sue
When you purchase through links on our site, we may earn an affiliate commission.Here’s how it works.
CrowdStrike shareholders have filed a lawsuit against the cybersecurity company followinga faulty software update that led millions of devices to crasharound the world.
The lawsuit, filed in Austin, Texas, accuses CrowdStrike of making “false and misleading” statements regarding its software testing procedures.
It claims the company’s share price plummeted a staggering 32% within 12 days of the incident, leading to a market value loss of $25 billion.
Shareholders sue CrowdStrike after outage
Subsequently, those who held stock between November 29 and July 29 are seeking unspecified compensation, alleging that executives defrauded investors by falsely assuring them that software updates were thoroughly tested.
On March 5, CEO George Kurtz had stated that the firm’s software was “validated, tested and certified.”
A company person told theBBC: “We believe this case lacks merit and we will vigorously defend the company.”
The issues stemmed from a bug in the system designed to ensure the proper functioning of software updates, which allowed “problematic content data” in a file to go undetected.
Are you a pro? Subscribe to our newsletter
Sign up to the TechRadar Pro newsletter to get all the top news, opinion, features and guidance your business needs to succeed!
On its ongoing incident reportpage, CrowdStrike declared that virtually all devices had been restored: “Using a week-over-week comparison, ~99% of Windows sensors are online as of July 29 at 5pm PT, compared to before the content update. We typically see a variance of ~1% week-over-week in sensor connections.”
The disruption hit Delta Airlines particularly hard, costing the airline around $500 million in lost revenue and passenger compensation. The company had to cancel more than 5,000 flights and manually reset 40,000 servers.
Delta CEO Ed Bastian has indicated that the airline will seek damages from CrowdStrike, stating: “We have no choice.” The company hasreportedlyenlisted the help of renowned lawyer David Boies to seek compensation from both CrowdStrike andMicrosoft.
More from TechRadar Pro
With several years’ experience freelancing in tech and automotive circles, Craig’s specific interests lie in technology that is designed to better our lives, including AI and ML, productivity aids, and smart fitness. He is also passionate about cars and the decarbonisation of personal transportation. As an avid bargain-hunter, you can be sure that any deal Craig finds is top value!
LG Electronics sets ambitious B2B revenue goal to offset declining consumer demand
New fanless cooling technology enhances energy efficiency for AI workloads by achieving a 90% reduction in cooling power consumption
Phishing attacks surge in 2024 as cybercriminals adopt AI tools and multi-channel tactics
