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Ubiquiti Inc.

Company NameUbiquiti Inc.
Stock SymbolUI
Class PeriodJanuary 11, 2021 to March 30, 2021
Lead Plaintiff Motion DeadlineJuly 19, 2021

On March 30, 2021, after the market closed, Krebs on Security published an article entitled “Whistleblower: Ubiquiti Breach ‘Catastrophic’” stating that the Company had downplayed a data breach from January 2021 and that the “third-party cloud provider claim was a fabrication.”  According to the article, the attacker(s) had accessed “privileged credentials that were previously stored in the LastPass account of a Ubiquiti IT employee, and gained root administrator access to all Ubiquiti AWS [Amazon Web Services] accounts, including all S3 data buckets, all application logs, all databases, all user database credentials, and secrets required to forge single sign-on (SSO) cookies.” As a result, the article noted that the Company should have immediately invalidated customers’ credentials and forced a reset, rather than asking customers to change their passwords when they next log on.”

On this news, the Company’s stock price fell $50.70, or 14.5%, to close at $298.30 per share on March 31, 2021, on unusually heavy trading volume.

The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants, in their statements concerning the data breach, failed to speak fully and truthfully because they failed to disclose to investors: (1) that the Company had downplayed the data breach in January 2021; (2) that attackers had obtained administrative access to Ubiquiti’s servers and obtained access to, among other things, all databases, all user database credentials, and secrets required to forge single sign-on (SSO) cookies; (3) that, as a result, intruders already had credentials needed to remotely access Ubiquiti’s customers’ systems; and (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

 

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