Norfolk County Council Triumphs Over Apple in £385m iPhone Dispute
Apple has agreed to a settlement of $490 million (£385 million) to resolve a lawsuit initiated by Norfolk County Council. The lawsuit, a class action, accused Apple’s CEO, Tim Cook, of deceiving shareholders by concealing dwindling iPhone demand in China. Norfolk Council, representing a pension fund it manages, asserted financial losses attributable to Cook’s actions.
In a statement, the Norfolk Pension Fund expressed satisfaction with the settlement, emphasizing its commitment to safeguarding the investments of numerous families and individuals. The fund underscored its responsibility as stewards of pensions, pledging to pursue decisive action against fraud when investors’ interests are compromised.
The lawsuit revolved around statements made by Apple’s CEO, Tim Cook, in November 2018. Cook assured investors of stable sales globally, excluding China from concerns of “sales pressure.” However, Apple revised its revenue forecast downward two months later, citing US-China tensions, which triggered a significant decline in Apple’s stock value. During this period, reports surfaced of Apple instructing smartphone assemblers to halt additional production lines for the newly launched iPhone XR.
The claimants, investors who purchased shares between November 2018 and January 2019, alleged financial losses due to Cook’s misleading statements. Originally initiated by the US city of Roseville, the lawsuit was later assumed by Norfolk Council, acting as the lead plaintiff in 2020.
Despite Apple’s resistance, opting for litigation, a trial slated for later this year may now be averted following the preliminary settlement, filed with the U.S. District Court in Oakland, California. However, the settlement’s final approval rests with a judge.
The specific portion of the settlement allocated to Norfolk County Council remains undisclosed. For Apple, the $490 million settlement represents a fraction of its substantial earnings, amounting to less than two days of its annual profit.
As one of the world’s wealthiest companies, Apple’s resolution of the lawsuit underscores the ongoing scrutiny faced by tech giants regarding transparency and accountability in their operations and communications with shareholders.
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