Cisco Systems agreed on July 31 to pay $8.6 million to settle litigation that the enterprise-technology giant violated the US False Claims Act for years when it failed to patch vulnerabilities in its family of video-surveillance products while continuing to sell the devices and software to the US government.
The whistleblower lawsuit, brought by law firm Constantine Cannon LLP, alleged that Cisco violated the US act when it sold vulnerable video-surveillance systems to federal agencies, state governments, and the District of Columbia. The lawsuit originated from issues in Cisco's Video Surveillance Manager that were reported in 2009 by a security consultant, James Glenn, while working for a Cisco partner. After initially listening to Glenn, the company fired him and continued selling the product, the lawsuit maintained.
"Cisco markets the product as particularly suited for government customers, and knows that the product is routinely sold to government customers, even though Cisco knows that these critical security flaws render the product largely ineligible for purchase by government entities," the court filing states.
The settlement is part of a trend of companies having to increasingly pay fines for their lapses in cybersecurity. In July, a UK regulator notified British Airways that the airline will face a $229 million fine for a 2018 data breach, the largest fine to date under the European Union's General Data Protection Regulation (GDPR).
For security companies, the settlement should be seen as a warning that they could be held liable for vulnerabilities in their products if the issues are not h ..
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