{"id":50032,"date":"2023-01-09T13:40:53","date_gmt":"2023-01-09T13:40:53","guid":{"rendered":"https:\/\/packetstormsecurity.com\/news\/view\/34200\/Shareholders-Ask-To-Revive-SolarWinds-Orion-Breach-Lawsuit.html"},"modified":"2023-01-09T13:40:53","modified_gmt":"2023-01-09T13:40:53","slug":"shareholders-ask-to-revive-solarwinds-orion-breach-lawsuit","status":"publish","type":"post","link":"https:\/\/www.threatshub.org\/blog\/shareholders-ask-to-revive-solarwinds-orion-breach-lawsuit\/","title":{"rendered":"Shareholders Ask To Revive SolarWinds Orion Breach Lawsuit"},"content":{"rendered":"
<\/div>\n

SolarWinds shareholders have appealed to the Delaware Supreme Court after a lower Chancery Court dismissed their lawsuit against the software company\u2019s directors last year, arguing that the board \u201cdid absolutely nothing\u201d for years to address cybersecurity flaws that were exposed in a massive 2020 hack of their flagship Orion IT management software.<\/p>\n

In an opening brief<\/a> filed Wednesday and obtained by SC Media, the shareholders told the state high court that Delaware Vice Chancellor Sam Glasscock III\u2019s September ruling ending their case was wrongly decided.<\/p>\n

The shareholders sued current and former SolarWinds directors in 2021 for their \u201cutter failure\u201d to monitor the systems and deal with cybersecurity deficiencies, which led to a 2020 hack that is widely viewed as one of the most severe cybersecurity incidents in U.S. history. <\/p>\n

However, Delaware Vice Chancellor Sam Glasscock III said last year that the company was the \u201cvictim of a major crime,\u201d and its leadership shouldn\u2019t carry the burden of responsibility under corporate law for \u201coperational loss\u201d and \u201csimple negligence.\u201d<\/p>\n

\u201cHistorically, only utter failures by directors to impose a system for reporting risk, or failure to act in the face of \u2018red flags\u2019 disclosed to them so vibrant that lack of action implicates bad faith, in connection with the corporation\u2019s violation of positive law, have led to viable claims under Caremark,\u201d the vice chancellor noted in a Sep. 6, 2022 opinion<\/a> obtained by SC Media.<\/p>\n

In Sunburst\u2019s case, there is no solid evidence indicating that the directors were operating in bad faith or ignore red flags to violate the law, the vice chancellor said, and the leadership seems to make efforts to minimize the impact of the incident.<\/p>\n

In Wednesday\u2019s opening brief, shareholders appealed to the vice chancellor\u2019s ruling by presenting evidence of how the company\u2019s directors were aware of the security flaws but neglected their duties to fix them over the years.<\/p>\n

Most of the claims underpinning this argument are identical to those made in a consolidated lawsuit<\/a> filed in Texas by a group of shareholders who purchased stock during the affected period of Sunburst. That case was settled<\/a> last November with the company agreeing to pay $26 million.<\/p>\n

In 2017, SolarWinds\u2019 previous global cybersecurity strategist, who expressed his concern over SolarWinds\u2019 security control, resigned in protest when senior executives were \u201cunwilling to make the corrections\u201d necessary.<\/p>\n

Shareholders added that in 2019, SolarWinds management was notified by an external researcher that an important company\u2019s password \u2014 \u201csolarwinds123\u201d \u2014 was leaked on the internet. SolarWinds executives have since said that a thorough investigation determined that the leaked password played no role in the eventual compromise.<\/p>\n

In addition, shareholders said that they reviewed SolarWinds board of directors\u2019 materials spanning the 26 months leading up to the revelation of Sunburst in 2020, and found an utter \u201cdearth of any board-level effort at monitoring.\u201d<\/p>\n

\u201cIndeed, the Board as a whole never received a single report or held a single discussion regarding cybersecurity,\u201d the brief read. \u201cThe Board\u2019s Audit Committee, specifically charged with overseeing cybersecurity issues, likewise never received a single report or held a single discussion regarding cybersecurity.\u201d<\/p>\n

SolarWinds, headquartered in Austin, Texas, is a company that develops software for businesses to help manage their networks and information technology infrastructure. The company owns nearly 300,000 clients, including most Fortune 500 companies and top U.S. government agencies, such as the FBI and the U.S. Department of Defense.<\/p>\n

A SolarWinds spokesperson told SC Media that the company \u201cdisagree[s] strongly\u201d with shareholders\u2019 allegation and \u201clook[s] forward to the truth coming to light.\u201d<\/p>\n

READ MORE HERE<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

READ MORE HERE…<\/p>\n","protected":false},"author":2,"featured_media":50033,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"colormag_page_layout":"default_layout","footnotes":""},"categories":[277],"tags":[8575],"class_list":["post-50032","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cybersecurity-blogs","tag-headlinehackergovernmentusadata-loss"],"yoast_head":"\nShareholders Ask To Revive SolarWinds Orion Breach Lawsuit 2026 | ThreatsHub Cybersecurity News<\/title>\n<meta name=\"description\" content=\"ThreatsHub Cybersecurity News | ThreatsHub.org | Cloud Security & Cyber Threats Analysis Hub. 100% Free OSINT Threat Intelligent and Cybersecurity News.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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