Slack Technologies Must Defend Stock Drop Securities Class Suit

Slack Technologies Inc. failed to shake off a proposed securities class action after the Northern District of California found allegations that the company misled investors about vulnerabilities related to service outages sufficient to survive dismissal.

The plaintiffs may also proceed with claims that the company failed to inform investors that it had agreed to compensate customers for such disruptions, the U.S. District Court for the Northern District of California said.

But the court dismissed the plaintiffs’ challenge to Slack’s statements about the strength of its “market leadership,” which allegedly downplayed the impact of potential competitors, including Microsoft Corp.

Slack adequately ...