Last month, the United States District Court for the Southern District of New York granted a motion to dismiss in In re Fed Ex Corp. Securities Litigation, a putative class action securities fraud case filed against FedEx following numerous disclosures in 2017 and 2018 regarding the impact of a Russian cyberattack on its recently acquired subsidiary, TNT Express Services B.V.
The court held that the complaint failed to adequately plead that FedEx had made any material misrepresentations or had the requisite scienter. FedEx’s successful defense against the lawsuit highlights the importance for companies to consider their disclosure obligations following a cyber-incident and carefully tailor their disclosures to account for their risks and accurately reflect the consequences of the incident.
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