Company News

Boardman Molded Products Sues IT Provider After $1.7M Loss

BOARDMAN, Ohio – Following a cybersecurity breach in 2018 that cost Boardman Molded Products $1.75 million, the company is suing its IT provider, Involta LLC.

In a suit filed Jan. 21 with the Mahoning County Common Pleas Court, Boardman Molded Products, 1110 Thalia Road, alleges that Involta “failed to protect Boardman’s bottom line and failed to provide the secure, highly available services” agreed to in April 2017, including virus and malware protection, firewalls, access controls, and patch and virus updates.

“Boardman relied upon the representations of Involta and accepted Involta’s offer to let Boardman’s IT staff focus on innovation and business-oriented tasks,” the suit states.

Between Jan. 16 and 25, 2018, accounting staff at Boardman Molded Products received fake invoices requesting more than $1.7 million be paid to companies in Hong Kong and Cambodia. On Jan. 25, 2018, a request for $765,000 was sent, but there wasn’t enough money in the company’s account  to cover the transaction, thus alerting Boardman Molded Products to the breach.

“The emails all came from [owner Ron Kessler’s] account and seemed legitimate to accounts payable,” said a report filed with Boardman Police Jan. 25, 2018.

When Involta was notified of the breach, the lawsuit alleges, the ticket was given a “medium” priority rating and the next day was closed after the IT provider “insisted that the breach had never taken place.”

Over the course of their service agreement, Boardman Molded Products says Involta had “an overall relaxed attitude regarding security issues,” including an “at risk” notification from cybersecurity management program AV Defender that remained for at least three months after the breach. Issues also arose when Boardman Molded Products’ internal IT staff was not able to set security rules for their network due to permissions established by Involta.

“At no time relevant hereto did Involta provide any proactive advice, suggestions and/or recommendations regarding training, potential concerns or any other topics regarding security or protection,” the lawsuit says.

Boardman Molded Products his filed two counts against Involta, one of breach of service order and one of professional negligence and malpractice, and is seeking at least $25,000 in damages. The company is seeking a trial by jury, which will determine the final amount. The case will be tried by Judge Anthony D’Apolito. 

Boardman Molded Products was established in 1957. The company designs and products plastic products ranging from caps to PVC flooring systems.

Involta, based in Cedar Rapids, Iowa, expanded into the Youngstown area in 2015 through the acquisition of DRS LLC and its two data centers here. In the time since, the IT firm has opened data centers in Akron, Cleveland and Pittsburgh and acquired three other IT companies: Kadium, BluePrairie and IT Lynk. It has 250 employees.

The full suit can be read here.

Related Coverage

Jan. 29, 2018: FBI Joins Probe into $1.75M Theft at Boardman Molded Products

Pictured: Boardman Molded Products’ office on Thalia Road.

Copyright 2020 The Business Journal, Youngstown, Ohio.