A wave of cyberattacks that targeted CDK Global in June has triggered a substantial lawsuit from several car dealerships and related businesses. The attack impacted CDK’s financial services at various dealerships across the United States. The plaintiffs argue that CDK’s alleged lax security measures were a direct cause of their substantial business losses.
According to sources from Automotive News, Manderbach Ford from Hamburg, Pennsylvania, and DLR Auto Group from Agoura Hills, California, are among the plaintiffs. The lawsuit, filed on July 12, holds CDK responsible for an attack that began on June 19 and lasted until July 15, causing more than $1 billion in damages and disrupting over 56,200 new vehicle sales.
“This case stems from CDK Global’s failure to implement sufficient data security protocols, resulting in a predictable data breach and subsequent financial harm to numerous automotive-related enterprises relying on CDK’s dealer management system,” the lawsuit alleges.
Manderbach Ford elaborated on the impact, stating that they were forced to revert to pen-and-paper transactions due to the inability to use CDK’s system. This not only hampered their sales processes but also prevented them from leveraging available rebates and incentives, thereby further curtailing their business operations.
“Our dealership was unable to process sales through the CDK system, forcing us to use manual methods and miss out on potential rebates, which decreased our revenue even further. Our service schedules also suffered considerable disruptions,” Manderbach Ford stated.
Similarly, DLR Auto Group highlights that they were non-operational for three weeks, attributing the extensive downtime directly to the cyberattack.
This lawsuit is part of a series of legal actions, with at least ten similar complaints filed against CDK. Each of these lawsuits underscores significant financial losses suffered by dealerships and related businesses. CDK reportedly paid a ransom of $25 million to resolve the attack.
Donald Smith, Editor of Automotive.fyi
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