CDK Global Faces Legal Battles as Dealerships Struggle with Cyberattack Fallout

Money | July 3, 2024, 5:54 p.m.

CDK Global is facing multiple lawsuits from auto dealerships following cyberattacks that disrupted the software provider's dealer management system. Employees and customers of these dealerships using CDK tools claim the company failed to adequately protect customer data, potentially exposing tens of thousands of individuals to hackers. The lawsuits, including a proposed class-action suit filed by an Asbury Automotive Group employee, allege CDK's weak cybersecurity measures left sensitive information vulnerable. Despite CDK's claims of strong cybersecurity capabilities, the lawsuits argue that the company's ineffective security training and system maintenance allowed cybercriminals to access personal data, including Social Security numbers and financial details. Affected dealerships are seeking damages and demand better protection of customer information. The lawsuits underscore the devastating impact of the cyberattacks on dealership operations, with one dealer describing the breach as a "disaster" disrupting sales, financing, and car payments. CDK's decision to restore systems without addressing underlying security flaws is likened to stitching up a wound without cleaning it, causing prolonged financial losses and exposure to further breaches. The company's response to the lawsuits and potential compensation for affected dealers remain uncertain.