Four Sets of Lawsuits, Three DismissedNarrow moat

CrowdStrike (CRWD) — moat facet

Courts have dismissed the shareholder, passenger and derivative suits over CrowdStrike's outage, leaving Delta as the one live claim.

The legal fallout from July 2024 has gone better for CrowdStrike than many expected. The securities class action, filed on 30 July 2024, was dismissed on 12 January 2026, and on 28 January 2026 "the court entered final judgment and closed the case"1.

How the July 2024 lawsuits ended12 Jan 2026securities classaction dismissed28 Jan 2026final judgment,case closedMar-Apr 2026derivative suitsdismissed15 Jun 2026passenger appealrehearing deniedCrowdStrike FY2026 10-K; Q2 FY2027 10-Q
Three of four fronts closed.

The passenger class actions in the Western District of Texas were dismissed on 18 June 2025; the Fifth Circuit affirmed on 20 May 2026 and denied rehearing on 15 June 20262. The shareholder derivative suits were all dismissed in March and April 20263.

That leaves Delta Air Lines, whose case is covered on the next page, and the costs of getting here. Net costs associated with the incident were $60.1 million in fiscal 2025 and $117.7 million in fiscal 20264. In the second quarter of fiscal 2027 the line turned into a net recovery of $14.5 million, from insurance, against $35.7 million of costs a year earlier5.

The dismissals matter for the moat because they cap the damage. A company that had to pay out to passengers and shareholders for an outage would face claims every time something went wrong. Courts so far have not treated a vendor's failed update as a liability to everyone downstream.

The derivative cases ended in three separate orders, on 18 March, 7 April and 16 April 20266, closing the last of the shareholder suits that followed the outage.

The incident cost line is the clearest measure of legal exposure. It swung to a $14.5 million net recovery in the latest quarter; a return to net costs above the $35.7 million of a year earlier would mean the legal tail is growing again.

Moat trajectory: Holding steady

Net July 19 line swung to a $14.5M recovery in Q2 FY2027.

The number that tests this moat
Reported
Net July 19 costs, latest quarter
Net recovery of $14.5M (Q2 FY2027), against $35.7M of costs

The legal and remediation tail; a return to net costs above $35.7M would mean it is growing again.

Source: CrowdStrike Q2 FY2027 results release ↗
⚠ Threats to the moat
⚠ THREAT 01
The Legal Bill Is Not Finished
CrowdStrike's outage-related costs doubled in the second year, to $117.7 million, even as it won its cases.
References
  1. ReportedThe securities class action, filed on 30 July 2024, was dismissed on 12 January 2026, and on 28 January 2026 "the court entered final judgment and closed the case".
    CrowdStrike Form 10-K for fiscal 2026 (year ended 31 January 2026) - Item 1A risk factors and Item 3 legal proceedings: competition, the July 19 incident, customer commitment packages, insurance and litigation. — FY2026 · publ. 5 March 2026 · source ↗
  2. ReportedThe passenger class actions in the Western District of Texas were dismissed on 18 June 2025; the Fifth Circuit affirmed on 20 May 2026 and denied rehearing on 15 June 2026.
    CrowdStrike Form 10-Q for the quarter ended 31 July 2026 - remaining performance obligations of $10.7 billion (46% within twelve months), unbilled backlog of $5.9 billion, the SGNL, Seraphic and XM Cyber transactions, the $750 million 3.00% senior notes, legal proceedings, the DOJ and SEC requests, purchase commitments and the share repurchase programme. — Q2 FY2027 · publ. 27 August 2026 · source ↗
  3. ReportedThe shareholder derivative suits were all dismissed in March and April 2026.
    CrowdStrike Form 10-Q for the quarter ended 31 July 2026 - remaining performance obligations of $10.7 billion (46% within twelve months), unbilled backlog of $5.9 billion, the SGNL, Seraphic and XM Cyber transactions, the $750 million 3.00% senior notes, legal proceedings, the DOJ and SEC requests, purchase commitments and the share repurchase programme. — Q2 FY2027 · publ. 27 August 2026 · source ↗
  4. ReportedNet costs associated with the incident were $60.1 million in fiscal 2025 and $117.7 million in fiscal 2026.
    CrowdStrike fourth-quarter and fiscal 2026 results release, Form 8-K exhibit 99.1 - fourth-quarter and full-year results, ARR, retention and module adoption. — Q4 FY2026 · publ. 3 March 2026 · source ↗
  5. ReportedIn the second quarter of fiscal 2027 the line turned into a net recovery of $14.5 million, from insurance, against $35.7 million of costs a year earlier.
    CrowdStrike second-quarter fiscal 2027 results release, Form 8-K exhibit 99.1 - fiscal 2027 and third-quarter guidance. — Q2 FY2027 · publ. 26 August 2026 · source ↗
  6. ReportedThe derivative cases ended in three separate orders, on 18 March, 7 April and 16 April 2026, closing the last of the shareholder suits that followed the outage.
    CrowdStrike Form 10-Q for the quarter ended 31 July 2026 - remaining performance obligations of $10.7 billion (46% within twelve months), unbilled backlog of $5.9 billion, the SGNL, Seraphic and XM Cyber transactions, the $750 million 3.00% senior notes, legal proceedings, the DOJ and SEC requests, purchase commitments and the share repurchase programme. — Q2 FY2027 · publ. 27 August 2026 · source ↗
Sources
Generated September 28, 2026