Delta Sues CrowdStrike Following July Outage That Cost Them $500M

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Posted on 10/26/2024 6:19:35 PM PDT by george76

Delta Airlines has filed a lawsuit against CrowdStrike following a global outage in July that costed them over $500 million.

On Friday, Delta filed a lawsuit against CrowdStrike in Georgia accusing the security software vendor of breach of contract and negligence following an outage in July that affected millions of computers and caused 7,000 flight cancellations.

Other airlines recovered faster than Delta, which said the incident reduced revenue by $380 million and cost $170 million. The flawed software update impacted computers running Microsoft’s Windows operating system.

Days following the outage, Delta hired David Boies of law firm Boies Schiller Flexner to seek damages from CrowdStrike and Microsoft.

Delta sought damages to cover its losses, as well as litigation costs and punitive damages.

The airline said CrowdStrike is liable for over $500 million in out-of-pocket losses as well as for an unspecified amount of lost profits, expenditures, including attorneys’ fees and “reputational harm and future revenue loss.”

“CrowdStrike caused a global catastrophe because it cut corners, took shortcuts, and circumvented the very testing and certification processes it advertised, for its own benefit and profit,” Delta said in its complaint. “If CrowdStrike had tested the Faulty Update on even one computer before deployment, the computer would have crashed.”

Delta stated that as part of its IT planning and infrastructure, it has spent billions of dollars “in licensing and building some of the best technology solutions in the airline industry.” CrowdStrike has questioned why Delta performed so poorly compared to other airlines.

Last month, CrowdStrike’s senior executive apologized to Congress for the faulty software update.

CrowdStrike’s senior vice president, Adam Meyers, stated that the company released a content configuration update for its Falcon Sensor security software, which resulted in system crashes worldwide.

“We are deeply sorry this happened and we are determined to prevent this from happening again,” Meyers told the media.

However, CrowdStrike spokesperson told CNBC in an email that Delta’s claims “are based on disproven information.

“While we aimed to reach a business resolution that puts customers first, Delta has chosen a different path,” a CrowdStrike spokesperson told CNBC in an email. “Delta’s claims are based on disproven misinformation, demonstrate a lack of understanding of how modern cybersecurity works, and reflect a desperate attempt to shift blame for its slow recovery away from its failure to modernize its antiquated IT infrastructure.”

1 posted on 10/26/2024 6:19:35 PM PDT by george76

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