Investor lawsuits against Apple continue
updated 01:55 am EDT, Tue August 29, 2006
Investor lawsuits continue
Yet another shareholder lawsuit was filed last week against Apple in the United States District Court for the Northern District of California. Filed by the law firm of Kantrowitz, Goldhamer & Graifman and its co-counsel, the lawsuit claims to be filed on behalf of "shareholders who purchased securities and/or sold put options of Apple" and seeks certification as a "class action." As with many of the previous lawsuits, it charges that Apple and certain of its officers and directors violated Sections 10(b), 14(a) and 20(a) of the Securities Exchange Act of 1934 and Rules 10-b(5) and 14a-9 promulgated thereunder as well as alleges that defendants made false and misleading statements and omissions concerning Apple's improper and undisclosed practice of backdating options granted to executives.
The case follows a string of earlier lawsuits filed throughout July and into August, naming top executives and alleging that defendants breached their fiduciary duties and colluded with one another to improperly backdate stock grants.
"This improper backdating masked the virtually instant profits the option recipients obtained," the new complaint alleges. "Under generally accepted accounting principles, these profits were required to be recognized as an expense in the Company's financial statements for the appropriate period, but were not. Thus, the Company's financial statements in its Form 10-K filing for the fiscal year 2005 and interim financial statements for 2005 and 2006 were materially false and misleading."
In June, Apple disclosed that it discovered option grant irregularities and later said that it may have to restate its earnings for the affected years following the internal investigation. The company has been notified by NASDAQ for failure to file its quarterly report--ending July 2006 (but will unlikely be delisted). Apple CEO Steve Jobs, among other executives--atleast one of whom has already retained legal counsel--may also be at risk of criminal charges.
biting off one's nose
08/29, 02:25am reply
... to spite one's face. uhmmm correct me if i'm wrong, but as a shareholder isn't suing the company you own shares in not the best of ideas?
dashiel
Fresh-Faced Recruit
Joined: Sep 2001
Dashiel
08/29, 05:20am reply
Yes you're right. These lawsuits are just a string of desperate attempts to make money that cheap and low class way rather than earning it. Regardless, my opinion is that all these lawsuits will be thrown out once the issue is resolved by having Apple pay whatever difference it owes due to these irregularities.
jarod
Fresh-Faced Recruit
Joined: Apr 2005
Re: dashiel
08/29, 12:55pm reply
Yes you're right. These lawsuits are just a string of desperate attempts to make money that cheap and low class way rather than earning it. Regardless, my opinion is that all these lawsuits will be thrown out once the issue is resolved by having Apple pay whatever difference it owes due to these irregularities.
Right, and what for us stockholders whose value of their stock was deflated because (a) apple cooked their books in order to get their executives top-dollar on their options, and (b) all the talk of stock irregularities flying off the bad press?
I guess we're just supposed to be happy that Apple got caught and fixed the problem. So what if we sold our stock for less then what we should have. Apple fixed the problem now, so we're all happy. (BTW, its not Apple who has to pay, its the executives, to cover the difference. Apple will/should have to pay a penalty itself as well because they let this c*** go on. Oh, great, more money leaving the company. Hope those execs enjoyed their new cars and boats with the money they made.)
testudo
Fresh-Faced Recruit
Joined: Aug 2001
Doncha love it
08/29, 05:02pm reply
how testudo already has Apple tried and convicted with no evidence? And was dumb enough to sell based on this little hiccup rather than thinking longer term. I lived through the days of Apple trading @ $19 a share back in the 90s but hung in there and my faith has been rewarded.
bigpoppa206
Fresh-Faced Recruit
Joined: Jun 2003