Snowflake Inc

From time to time, we have been and will continue to be subject to legal proceedings and claims. We are not presently a party to any legal proceedings that, if determined adversely to us, would individually or taken together have a material adverse effect on our business, results of operations, financial condition, or cash flows.

We have received, and may in the future continue to receive, claims from third parties asserting, among other things, infringement of their intellectual property rights.

On February 29, 2024, a stockholder class action lawsuit was filed against us, our former Chief Executive Officer, and our Chief Financial Officer in the United States District Court in the Northern District of California, alleging violations under Sections 10(b) and 20(a) of the Exchange Act. The complaint seeks an unspecified amount of damages, attorneys’ fees, expert fees, and other costs. The case is at a very preliminary stage. In addition, since the filing of the class action lawsuit, four additional securities derivative claims have been filed against us and certain of our directors and executive officers alleging similar violations. We are in the process of attempting to stay the derivative claims pending resolution of the class action lawsuit. We and the other defendants intend to vigorously defend against the claims in this action.

On June 13, 2024, a class action was filed in the United States District Court for the District of Montana against Snowflake alleging that Snowflake failed to take reasonable measures to secure systems that contained consumer data, thereby allowing threat actors to access and exfiltrate the customers’ data. In the weeks that followed, numerous additional class actions making the same or similar allegations were filed against Snowflake and/or customers whose consumer or employee data was exfiltrated. Among other claims, the complaints assert common law claims for negligence, breach of fiduciary duty, breach of implied contract, and unjust enrichment, as well as statutory claims, and seek an unspecified amount of damages, attorneys’ fees and costs, as well as injunctive relief. The cases are at a preliminary stage. We intend to vigorously defend against the claims.

Future litigation may be necessary to defend ourselves, our partners, and our customers by determining the scope, enforceability, and validity of third-party proprietary rights, or to establish our proprietary rights. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. See Note 10, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.