Kyndryl Faces Class Action Lawsuits Over Alleged Securities Fraud

Investors have until April 13, 2026 to apply to be lead plaintiffs in the cases against the IT infrastructure services company.

Mar. 28, 2026 at 4:34am

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Kahn Swick & Foti, LLC, a law firm led by former Louisiana Attorney General Charles C. Foti, Jr., has filed class action lawsuits against Kyndryl Holdings, Inc. on behalf of investors who suffered losses due to alleged securities fraud between August 1, 2024 and February 9, 2026. The lawsuits were prompted by Kyndryl's disclosure on February 9, 2026 that it would be unable to timely file its Q3 2025 financial report and that it anticipated reporting material weaknesses in its internal controls, as well as the departures of its CFO and General Counsel.

Why it matters

The class action lawsuits against Kyndryl highlight the potential consequences for publicly traded companies that fail to maintain robust financial reporting and internal controls. Investors rely on accurate and timely disclosures to make informed decisions, and allegations of securities fraud can significantly impact a company's stock price and reputation.

The details

According to the lawsuits, Kyndryl failed to disclose material information about its financial reporting and internal control weaknesses, which led to a 55% drop in the company's stock price on February 9, 2026 when the issues were revealed. The class period covers a period of nearly 18 months, suggesting the alleged fraud may have been ongoing for an extended period.

  • On February 9, 2026, Kyndryl disclosed that it would be unable to timely file its Q3 2025 financial report and that it anticipated reporting material weaknesses in its internal controls.
  • The first-filed case, Brander v. Kyndryl Holdings, Inc., et al., was filed on February 26, 2026.
  • A subsequently filed case, Westchester Putnam Counties Heavy & Highway Laborers Local 60 Benefit Funds v. Kyndryl Holdings, Inc. et al., expanded the class period on March 15, 2026.

The players

Kyndryl Holdings, Inc.

An IT infrastructure services company that was spun off from IBM in 2021.

Kahn Swick & Foti, LLC

A law firm that has filed the class action lawsuits against Kyndryl on behalf of investors. The firm is led by former Louisiana Attorney General Charles C. Foti, Jr.

Charles C. Foti, Jr.

The former Attorney General of Louisiana and a partner at Kahn Swick & Foti, LLC.

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What they’re saying

“Kyndryl investors should contact KSF Managing Partner Lewis Kahn toll-free at 1-877-515-1850, or via email (lewis.kahn@ksfcounsel.com), or visit https://www.ksfcounsel.com/cases/nyse-kd/ to learn more.”

— Lewis Kahn, Managing Partner, Kahn Swick & Foti, LLC

What’s next

Investors have until April 13, 2026 to apply to be lead plaintiffs in the class action lawsuits against Kyndryl. The court will then decide on the lead plaintiffs, but all investors who suffered losses during the relevant time period can participate in any potential recovery, even if they are not selected as lead plaintiffs.

The takeaway

The Kyndryl case highlights the importance of public companies maintaining robust financial reporting and internal controls to ensure transparency and protect investor interests. The class action lawsuits serve as a reminder that alleged securities fraud can have significant consequences for a company's stock price and reputation, and that investors have legal recourse to seek compensation for their losses.