CrowdStrike Holdings, Inc. (CRWD) Class Action

The litigation focuses on the propriety of CrowdStrike’s representations concerning the efficacy of its AI-native CrowdStrike Falcon platform, including assurances that its technology was “validated, certified, and tested.”

The complaint alleges that CrowdStrike’s assurances were false and misleading because the company failed to disclose that: (1) it instituted deficient controls in its procedures for updating Falcon and was not properly testing updates to Falcon before rolling them out to customers; (2) this inadequate software testing created a substantial risk that an update to Falcon could cause major outages for a significant number of CrowdStrike customers; and (3) such outages could pose, and ultimately created, substantial reputational harm and legal risk to the company.

The company’s assurances came into question beginning on July 19, 2024, when CrowdStrike issued an automatic update for its flagship Falcon Sensor security product which contained a bug and caused a massive overnight outage that affected 8.5 million Windows computers around the world, disrupting businesses, airports, train stations, banks, broadcasters, and the healthcare sector. Many affected machines were unable to restart, instead showing a blue error screen sometimes called “the blue screen of death.”

The news was accompanied by several analyst downgrades with one at Guggenheim downgrading CrowdStrike from buy to neutral, reportedly writing that “[t]he restoration of its reputation may take more time and will likely affect new business signings at least in the near-term.”

Then, on July 29, 2024, news outlets reported that one of CrowdStrike’s customers (Delta Airlines) which suffered more than 6,000 flight cancellations hired a prominent attorney to seek damages caused by the faulty update.

These events have driven the price of CrowdStrike shares down $84.24 (-24%) since July 18, 2024.

FREQUENTLY ASKED QUESTIONS ABOUT THE CASE

What is the CRWD securities class action about?

The investigation focuses on the propriety of certain statements made by cybersecurity company, CrowdStrike Holdings, about its AI-native CrowdStrike Falcon platform.

WHAT SHOULD I DO?

I worked at CRWD. What should I do?

If you were an employee of CRWD, you may have valuable information that could be relevant to the investigation. Hagens Berman is one of the nation’s top whistleblower law firms, and has successfully represented many individuals who come forward with information regarding corporate malfeasance. Under the new SEC Whistleblower program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, contact Reed Kathrein at 844-916-0895 or [email protected].

There are multiple law firms participating, do I need to contact all of them?

No, you do not need to contact all participating law firms. Generally, class-action investigations and lawsuits are consolidated into a single case to streamline the legal process, and attorneys from only a few law firms are selected to serve in a leadership role on the consolidated case. Hagens Berman has a proven track record of being appointed to leadership roles in complex, multidistrict litigation regarding investor fraud and other consumer rights issues, and your claim will be handled by attorneys who have helped secure approximately $325 billion in class-action settlements on behalf of individuals who have suffered due to corporate malfeasance and the wrongdoing of other powerful institutions.

AM I ELIGIBLE?

What is the threshold amount to be eligible? What are “substantial” losses?

The threshold amount and the definition of "substantial" losses may vary depending on a number of factors specific to the case, including the size of the company, market cap, shares outstanding and who holds them and the damages alleged by the fraud. In general, to be eligible to participate in a class-action lawsuit, you must be able to demonstrate that you suffered financial losses as a result of the alleged wrongdoing and that your losses meet the criteria set by the court or law firm. Fill out the form and submit your losses.

CAN I PARTICIPATE?

Am I affected? What do I need to do to participate?

If you were an investor in CRWD, you may be affected and eligible to participate in the case. To determine your eligibility and potential involvement, fill out the form and submit your losses.

Can any CRWD investor participate?

In most class-action investigations and cases, any investor who meets the eligibility criteria, including purchasing the shares during the relevant period, can participate, regardless of the size of their investment. Fill out the form to find out your rights.

I bought on a non-U.S. Exchange. Can I participate?

No. This investigation only covers shares bought on a U.S. exchange, i.e. NASDAQ or NYSE. Fill out the form to find out your rights.

Am I included if I still hold my shares, or do I need to sell to participate?

Participation is based on purchasing shares during the relevant period, rather than your current holdings. Accordingly, you do not need to sell to participate. Fill out the form to find out your rights.