Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
Lessons for CISOs from the SolarWinds Breach and SEC Enforcement
In an era where digital threats loom large, the responsibilities of Chief Information Security Officers (CISOs) have expanded beyond traditional IT security to encompass a broader governance, risk management, and compliance role. The infamous SolarWinds Corp. attack, which compromised numerous public and private organizations globally, illustrates the complex cybersecurity landscape CISOs navigate. The subsequent legal and regulatory responses, including a complaint by the U.S. Securities and Exchange Commission (SEC), underscore the critical role of CISOs in not only safeguarding digital assets but also ensuring compliance with evolving cybersecurity disclosure requirements. This article examines the SolarWinds incident and the SEC's actions to derive essential governance lessons for CISOs.
In 2020, SolarWinds disclosed that it had been subject to a cyberattack, commonly referred to as "SUNBURST." SUNBURST is believed to have been conducted by Russian state-sponsored hackers and affected over 18,000 customers, including government agencies and Fortune 500 companies. See, Complaint, Securities and Exchange Commission v. SolarWinds Corp. et al, Case No. 1:23-cv-09518. Filed Oct. 30, 2023. Attackers compromised the infrastructure of SolarWinds, a leading provider of IT management software, to distribute malicious updates to the company's Orion software.
In response to the breach, on Oct. 30, 2023, the SEC sued SolarWinds and its CISO, Timothy G. Brown, in connection with the SEC Division of Enforcement's investigation of the cyberattack. Id. The SEC alleges that from October 2018, when SolarWinds went public, to January 2021, SolarWinds and Brown "defrauded SolarWinds" investors by overstating SolarWinds' cybersecurity practices and understating or failing to disclose known risks. See, "SEC Charges SolarWinds and Chief Information Security Officer with Fraud, Internal Control Failures," U.S. Secrities and Exchange Commission. Oct. 30, 2023. In its filings with the SEC, SolarWinds allegedly misled investors by disclosing only generic and hypothetical risks at a time when SolarWinds and Brown knew of specific deficiencies in SolarWinds' cybersecurity practices as well as the increasingly elevated risks the company faced at the same time. See, Amended Complaint, Securities and Exchange Commission v. SolarWinds Corp. et al, Case No. 1:23-cv-09518. Filed Feb. 16, 2024. Recently, the SEC filed an amended complaint that lays out the same claims it made against the company last fall, only in greater detail. Id.
This premium content is locked for Entertainment Law & Finance subscribers only
ENJOY UNLIMITED ACCESS TO THE SINGLE SOURCE OF OBJECTIVE LEGAL ANALYSIS, PRACTICAL INSIGHTS, AND NEWS IN ENTERTAINMENT LAW.
- Stay current on the latest information, rulings, regulations, and trends
- Includes practical, must-have information on copyrights, royalties, AI, and more
- Tap into expert guidance from top entertainment lawyers and experts
Already a have an account? Sign In Now Log In Now
For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473
How Secure Is the AI System Your Law Firm Is Using?
What Law Firms Need to Know Before Trusting AI Systems with Confidential Information In a profession where confidentiality is paramount, failing to address AI security concerns could have disastrous consequences. It is vital that law firms and those in related industries ask the right questions about AI security to protect their clients and their reputation.
COVID-19 and Lease Negotiations: Early Termination Provisions
During the COVID-19 pandemic, some tenants were able to negotiate termination agreements with their landlords. But even though a landlord may agree to terminate a lease to regain control of a defaulting tenant's space without costly and lengthy litigation, typically a defaulting tenant that otherwise has no contractual right to terminate its lease will be in a much weaker bargaining position with respect to the conditions for termination.
Pleading Importation: ITC Decisions Highlight Need for Adequate Evidentiary Support
The International Trade Commission is empowered to block the importation into the United States of products that infringe U.S. intellectual property rights, In the past, the ITC generally instituted investigations without questioning the importation allegations in the complaint, however in several recent cases, the ITC declined to institute an investigation as to certain proposed respondents due to inadequate pleading of importation.
Authentic Communications Today Increase Success for Value-Driven Clients
As the relationship between in-house and outside counsel continues to evolve, lawyers must continue to foster a client-first mindset, offer business-focused solutions, and embrace technology that helps deliver work faster and more efficiently.
The Power of Your Inner Circle: Turning Friends and Social Contacts Into Business Allies
Practical strategies to explore doing business with friends and social contacts in a way that respects relationships and maximizes opportunities.