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Apple must face U.S. shareholder lawsuit over CEO's iPhone, China comments

Added 06-03-20 11:03:02am EST - “A federal judge said Apple Inc must face part of a lawsuit claiming it fraudulently concealed falling demand for iPhones, especially in China, leading to tens of billions of dollars in shareholder losses.” - Reuters.com

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Posted By TheNewsCommenter: From Reuters.com: “Apple must face U.S. shareholder lawsuit over CEO's iPhone, China comments”. Below is an excerpt from the article.

(Reuters) - A federal judge said Apple Inc (AAPL.O) must face part of a lawsuit claiming it fraudulently concealed falling demand for iPhones, especially in China, leading to tens of billions of dollars in shareholder losses.

While dismissing most claims, U.S. District Judge Yvonne Gonzalez Rogers ruled late Tuesday that shareholders can sue over Chief Executive Tim Cook’s comments touting strong iPhone demand on a Nov. 1, 2018 analyst call, only a few days before Apple told its largest manufacturers to curb production.

“Absent some natural disaster or other intervening reason, it is simply implausible that Cook would not have known that iPhone demand in China was falling mere days before cutting production lines,” Rogers wrote.

The Oakland, California-based judge also said a decision by Apple to stop reporting iPhone unit sales “plausibly suggests that defendants expected unit sales to decline.”

The complaint, led by the Employees’ Retirement System of the State of Rhode Island, came after Cook on Jan. 2, 2019 unexpectedly reduced Apple’s quarterly revenue forecast by up to $9 billion, in part because of U.S.-China trade tensions.

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