Apple faces second financial misrepresentation suit
Talked products up then failed to deliver, case claims
More investors may be lining up to attack Apple's bosses for allegedly misleading shareholders last year about the Mac maker's financial performance.
This week lawyers at Schiffrin & Barroway launched a suit on behalf of investors who bought Apple stock between 19 July 2000 and 28 September the same year.
A class-action lawsuit was filed last month by law firm Milberg Weiss, initially on behalf of a pension fund but later expanded to take in other interested parties.
The latest suit, like the first, claims that Apple executives knowingly made false statements regarding the company's anticipated Q4 2000 sales performance.
The new action focuses more on Apple's promotion of the (then) new Power Mac G4, Cube and iMac, claiming that Apple said they were "exceptionally powerful, fast and attractive, coming with exceptionally attractive designs and containing new and revolutionary features" and that they were "ready for mass production, and would be available in quantity shortly".
When Apple published its Q4 2000 results in October last year, the company said that sales of all three products were disappointing. The reason, alleges the Schiffrin & Barroway suit, was that the products were "late to market, had defects and lacked features essential for market success".
The upshot is that Apple's stock, which had risen to $64, the lawyers say, on the back of the launch of said products, fell to $13 when the Q4 results were made known.
But not before at least four senior Apple staffers sold 370,000 shares for $22 million. The Milberg Weiss suit claims they did so with inside knowledge of where the company's sales were going.
Like the Milberg Weiss suit, the Schiffrin & Barroway action seeks unspecified damages. ®