FedEx is in deep trouble over alleged cover up of cyber attack impact

FedEx cyber attack Reuters

The American multinational courier delivery services company FedEx is currently facing a lawsuit as it has violated security laws after a cyber attack.

This lawsuit impacts those individuals who purchased FedEx stock in a 15-month period since 2017 September. As per the reports, the suit alleged that the company, headquartered in Tennessee misguided the investors about how fast they would be able to cover up costs from the cyber attack, which hampered TNT Express, one of its subsidiaries.

Pomerantz Law Firm has filed the lawsuit, while claiming that executives downplayed the impact of the data breach in June 2017 of its largest acquisition ever that includes $4.8 billion purchase of TNT Express.

The lawsuit also revealed that the FedEx cybersecurity breach also caused large shipping customers to go with competitors as well as suffer losses, but as per the suit, the company assured the investors that the losses were minimal. It further added that the integration caused members of the class action lawsuit to buy FedEx stocks at artificially inflated prices.

On the other hand, a spokesperson from FedEx said in a statement that the company and some of its current, as well as former executives, have been named as "defendants in two putative class action lawsuits purported to be brought on behalf of persons or entities who acquired FedEx common stock during the period from 19 September 2017 through 18 December 2018."

"The lawsuits allege violations of the U.S. securities laws in connection with the Company's public disclosures during that period. FedEx intends to vigorously defend itself against these allegations and will respond accordingly," the statement added.