The $8.1 billion Employees’ Retirement System of Rhode Island (ERSRI) has been named the lead plaintiff in a class action lawsuit against Alphabet Inc., the parent company of Google, over the October 2018 revelation that the company failed to disclose a security breach that compromised the personal information of 500,000 users.
Following the October news, Alphabet later revealed the number of users whose private information was compromised was significantly larger than it had originally reported, surmounting to over 52.5 million accounts.
“Google knew that there had been a security breach and that users’ private information had been compromised, and instead of disclosing the information, they chose to hide it,” Rhode Island Treasurer Seth Magaziner said in a statement.
All similar class action lawsuits brought against Google in relation to its failure to disclose the security breach will be consolidated under the ERSRI-led case. Suitors objecting to the consolidation will have 10 days from the January 25 ruling to file their objections with the Northern District of California.
The ERSRI, which holds about 44,500 shares in Alphabet Inc., valued at approximately $47.7 million, “petitioned to serve as lead plaintiff because we felt that we had both the standing and internal resources to support the suit,” a spokesperson for the retirement system told CIO.
“We monitor the behavior at companies in which we invest regularly and encourage practices that are in the long-term interest of the company and its shareholders,” the spokesperson added. “Often, this involved engaging companies to help improve practices, however in matters like the one at Alphabet, we feel it is necessary and appropriate to seek legal remedy.”
The ruling, ordered by United States District Judge Jeffrey White, also approved Robbins Geller Rudman & Dowd LLP as lead counsel.
As a result of the case, Google is shutting the doors on its Google Plus social network, which the company claims third-party apps that integrated the platform onto their software were granted the ability to view private information of its users through a “glitch.” The social network is expected to cease operations March 7, 2019.
“We found no evidence that any developer was aware of this bug, [or that] any profile data was misused,” Google said in an earlier statement.
Tags: Alphabet, Employees’ Retirement System of Rhode Island, Google, Seth Magaziner