Apple Unsuccessful In Overturning Lawsuit Alleging That CEO Tim Cook Kept Information From Shareholders Regarding Falling iPhone Demand In China
Apple CEO Tim Cook remarked on the company’s November 2018 earnings call about the iPhone sales position in China. When the company faced challenges in markets like Brazil, Russia, Turkey, India, and others due to a weakening currency, Cook left out China, stating, ‘I would not put China in that category.’
However, shortly after, Apple informed its suppliers to slow down production in the region, cutting its revenue forecast by $9 billion. Cook’s comment concerning the country has been highlighted in the lawsuit, stating that shareholders would have suffered financially for not being kept in the loop.
U.S. District Judge Yvonne Gonzalez Rogers made the decision late Monday, and with it, shareholders led by Norfolk County Council and England-based local government authority can sue for a day-one incident that saw Apple’s market value dwindle by $74 billion. With Tim Cook withholding information regarding China’s iPhone market, Apple lowered its revenue forecast, the first since the OG iPhone’s launch in 2007.
What followed was the company’s shares falling by 10 percent the next day. Judge Rogers also states that Apple was well aware that China’s economy was slowing down, and it was holding back valuable data stating that iPhone demand could call. Apple’s reasoning for keeping this information has not been mentioned, but failure to provide these insights could have ruined shareholders financially.
According to AppleInsider, Apple states that CEO Tim Cook’s comment regarding China was his own opinion, with the company’s attorneys stating that the lawsuit’s claim ‘fails to plead any actionably false or misleading statement.’ Fast forward to 2023, and Apple’s market value has increased by four times the value in 2018, reaching $3
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