British Columbia

Cyber attack alleged in BC Supreme Court lawsuit

Vancouver technology company claims former employee mounted cyber attack on customer databases in a bid to influence corporate negotiations.

Skunkwerks claims former employee targeted customer databases in a bid to impact business

Skunkwerks Software is suing a former employee over a cyber attack allegedly timed to disrupt business negotiations.

A Vancouver technology company is accusing a former employee of mounting a cyber attack on customer databases in an incident deliberately timed to influence business negotiations.

In a BC Supreme Court claim, Skunkwerks Software says servers housed at Simon Fraser University and UBC were simultaneously targeted during contentious mediation with shareholders over ownership of subsidiary iClinic.

"The cyber attack was timed to occur when the controlling minds of (Skunkwerks) were engaged in the mediation," the lawsuit reads. 

"The decision to carry out the cyber attack was for the purpose of both injuring (Skunkwerks) and asserting pressure on (the company's) representatives at the mediation to settle the shareholder dispute."

Criminal investigation

The incident is also the subject of an investigation by the RCMP's Integrated Technological Crime Unit.

Skunkwerks is suing former employee Chris Hii for breach of duty, civil conspiracy and civil intimidation.

The Vancouver-based software company creates interactive databases for clients ranging from universities to HBO.

The servers allegedly struck in the cyber attack belonged to SFU's Office of Research Ethics and the UBC office of Mitacs, a not-for-profit organization which links research and industry.

According to the claim, Hii worked for Skunkwerks from 2009 to 2013, rising to the position of vice-president of project development. In that time, the company claims he was privy to confidential client information.

Skunkwerks founded iClinic in 2005, ultimately spinning it into a separate company dedicated to working with doctors and health authorities. But Skunkwerk's founders kept a controlling interest.

While Hii's job at Skunkwerks ended, the lawsuit says he kept working at iClinic until he was terminated without cause on Feb. 20, 2015.

At about that time, a dispute arose between the founders of Skunkwerks and iClinic's minority shareholders.

The two sides attended mediation on the morning of Feb. 23; in the afternoon, the databases at Mitacs and SFU came under attack. Over a million records were modified and "sensitive electronic documents" and records disappeared.

"The timing of the cyber-attack was deliberate," the lawsuit says. "(Hii) conspired with one or more persons to use the cyber-attack as a pressure tactic."

The founders of Skunkwerks gave up their controlling interest in iClinic and transferred all their shares as of Feb. 24, 2015. According to the lawsuit, Hii was hired by the new owners "on or about" the next day.

Reached at iClinic, Hii declined comment. In a response to the lawsuit filed in BC Supreme Court, he has challenged the court's jurisdiction.

RCMP obtained a search warrant in relation to the allegations in June; no charges have been filed. Mitacs says no sensitive information was breached, and SFU described the incident as "quite minor."

Skunkwerks claims it was forced to spend 171.25 hours investigating and fixing the corrupted databases. The company claims it also lost business.