Brit County Suing Apple Over Misleading Information
Norfolk County Council in Britain has been granted class-action status by a judge in California in their case against Apple, who they claim lost them money in a pension fund because they misled shareholders about the performance of their business in China.
The council runs the multi-billion pound Norfolk Pension Fund, which includes council employees and workers from other public bodies.
As administrator of the fund, the council is lead plaintiff and is suing Apple, as well as their chief executive Tim Cook and CFO Luca Maestri.
Apple are contesting the legal action, which also includes a number of US pension funds.
Court documents allege the “defendants misrepresented the state of Apple’s business in Greater China, the company’s most important growth market at the time.”
Cook was allegedly challenged about a “deceleration” in emerging markets on a call with analysts and investors on November 1, 2018.
It is claimed he admitted pressure in certain markets, such as Turkey and Russia, but didn’t put China in the same category, allegedly saying, “In relation to China specifically, I would not put China in that category,” adding “iPhone, in particular, was very strong double-digit growth there.”
Reports cames to light a few days later, on November 5, that Apple told their top phone assemblers to “halt plans for additional production lines” on the recently released iPhone XR.
Then, in January 2019, Apple pre-announced their first earnings shortfall in 15 years, with Cook telling investors there had been “lower than anticipated iPhone revenue, primarily in Greater China.”
Shares then fell from $157.92 on January 2 to $142.19 on January 3.
The plaintiffs are claiming Cook misled shareholders, though Apple contest this, maintaining that his comments “were statements of opinion, and thus protected.”