Kaspersky sues US Homeland Security Department over ban
Kaspersky Labs is firing back at the U.S. government and filed a lawsuit against the Department of Homeland Security for failing to provide the company basic due process. In the suit, filed Tuesday in the U.S. District Court for the District of Columbia, the company alleged DHS harmed Kaspersky’s reputation and commercial interest in the U.S. without evidence of wrongdoing.
In September, DHS issued a ban on the use of Kaspersky products at all federal departments and agencies — like the Department of Health and Human Services. In its suit, the security firm claimed it wasn’t given prior notice or an opportunity to be heard by DHS. Under the Administrative Procedure Act, the suit alleged that DHS was required to provide Kaspersky with adequate due process before the binding operating directive that banned the company’s products was issued.
DHS, when it issued the ban, claimed that Kaspersky products caused security risks, gave the vendor broad access to files and elevated privileges, and could be exploited by hackers. However, the mentioned capabilities aren’t unique to Kaspersky. “There is no evidence presented by DHS of improper coordination between Kaspersky Lab or its executives and the Russian Government in furtherance of demonstrable illicit activities,” according to the suit. “Rather, DHS speculates that cybersecurity risks are presented by Kaspersky Lab products merely by virtue of the fact that the Company is headquartered in Moscow.”
Further, 85 percent of Kaspersky’s revenue is generated outside of Russia. That alone, the lawsuit claimed, is a “powerful economic incentive to avoid any action that would endanger the trusted relationships and integrity that serve as the foundation of its business.” While the use of Kaspersky licenses by federal agencies is only about £54,000 or .03 percent of total annual sales, the real issue is the government ban’s effect on U.S. sales to commercial and enterprise U.S. clients.
Staples, Best Buy and Office Depot — among others — pulled Kaspersky products from shelves after the rumors began. “The BOD, supported by other actions in Congress, has also had a severe adverse impact on Kaspersky’s other commercial interests in the U.S., which began long before the Defendants’ decision was officially declared ‘final,'” according to the suit. Kaspersky’s third-quarter sales “have fallen significantly” when compared to previous years.
And the suit also revealed the company is “receiving and processing an unprecedented volume of product return and early termination requests,” as a direct result of government actions. In fact, customers specifically refer to those actions when explaining the reason for their returns. The security firm is asking the court to invalidate and rescind DHS’ ban and for DHS to declare the use of Kaspersky products on federal IT systems.