A proposed class action filed in federal court in Seattle alleges that technology company F5 misled investors about its cybersecurity strength before disclosing a significant breach that later coincided with steep stock declines, according to court documents.
The lawsuit, filed in U.S. District Court for the Western District of Washington, was brought by Matthew Smith on behalf of investors who bought or acquired F5 securities between Oct. 28, 2024, and Oct. 27, 2025.
It names F5 and four top executives as defendants, including CEO François Locoh-Donou and CFO Edward Cooper Werner.
F5 is headquartered in downtown Seattle.
According to the complaint, the company repeatedly told investors it offered industry-leading application and API security while a long-term breach was already underway inside key development systems tied to its BIG-IP product line.
BIG-IP is described in the filing as F5’s highest-revenue product.
The lawsuit alleges that investors were first alerted to the issue on Oct. 15, 2025, when F5 disclosed that a sophisticated threat actor had maintained “long-term, persistent” access to internal systems.
The company said files were taken from its BIG-IP product development and engineering knowledge platforms, including portions of source code and information tied to undisclosed vulnerabilities.
F5 stated at the time that it learned of the breach in August 2025 and that it had taken steps to contain the intrusion.
The company also said it had not seen new unauthorized activity since those efforts began and that it was working with cybersecurity firms and government partners.
Following that disclosure, F5’s stock price fell sharply.
Shares dropped from a closing price of $343.17 on Oct. 14, 2025, to $295.35 two days later, a decline of nearly 14%, according to figures cited in the complaint.
The lawsuit claims that despite the October disclosure, the company did not initially provide investors with key details about the potential business impact, including possible effects on customer behavior, future sales, or remediation costs.
Additional information emerged after the market closed on Oct. 27, 2025, when F5 released its fourth-quarter earnings and issued a weaker-than-expected outlook for fiscal 2026.
The company said it anticipated slower growth, citing disruptions to sales cycles as customers assessed and addressed their own environments.
After that announcement, F5 shares again declined, falling from $290.41 on Oct. 27 to $258.76 the next day, an additional drop of nearly 11%, the lawsuit states.
The complaint argues that throughout the class period, F5 executives emphasized confidence in the company’s cybersecurity capabilities during earnings calls and investor conferences, including repeated descriptions of its security platform as the most effective and comprehensive in the industry.
The lawsuit alleges those statements painted an incomplete picture because the breach was already underway or had not been fully disclosed.
F5 has said publicly that it continues to invest heavily in strengthening security and that customers have been updating systems following the disclosure.
KIRO 7 News has reached out to F5 for comment.
The case seeks damages under federal securities laws and requests a jury trial.
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