Apple has agreed to pay $490 million to settle a lawsuit. The lawsuit claimed that Tim Cook, the CEO, didn't tell investors the truth about iPhone sales in China dropping. The court in Oakland, California, got the settlement details, but a judge still needs to approve it.
The lawsuit began after Apple said it would make $9 billion less than expected in early 2019. This drop was blamed on trade issues between the U.S. and China. Back in November 2018, Cook said China's sales were fine, even though other countries were struggling.
Soon after, Apple told its factories to make fewer iPhones. This was the first time Apple had to lower its sales forecast since the iPhone came out in 2007. The company's stock value fell by $74 billion the next day.
Apple hasn't responded to the settlement news. The company says it did nothing wrong but decided to settle to avoid the hassle and expense of a court fight. A lawyer for the investors who sued called the settlement a great outcome. This group includes people who bought Apple stock in the two months after Cook said China's sales were good.
Judge Yvonne Gonzalez Rogers, who is handling the case, decided not to end the lawsuit last year. She thought it was possible that Cook was misleading about how well iPhones were selling. She also noted that Apple was aware of the economic slowdown in China and the risk of falling demand.
The main plaintiff in the case is a pension fund from Norfolk, England. The lawyers for the investors might ask for up to 25% of the settlement money as their fee.
Despite this lawsuit, Apple's stock price has gone up more than four times since January 2019. Now, Apple is worth more than $2.6 trillion. The legal case is known as In re Apple Inc Securities Litigation and is being handled in the Northern District of California.
Image: DIW-AIgen
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The lawsuit began after Apple said it would make $9 billion less than expected in early 2019. This drop was blamed on trade issues between the U.S. and China. Back in November 2018, Cook said China's sales were fine, even though other countries were struggling.
Soon after, Apple told its factories to make fewer iPhones. This was the first time Apple had to lower its sales forecast since the iPhone came out in 2007. The company's stock value fell by $74 billion the next day.
Apple hasn't responded to the settlement news. The company says it did nothing wrong but decided to settle to avoid the hassle and expense of a court fight. A lawyer for the investors who sued called the settlement a great outcome. This group includes people who bought Apple stock in the two months after Cook said China's sales were good.
Judge Yvonne Gonzalez Rogers, who is handling the case, decided not to end the lawsuit last year. She thought it was possible that Cook was misleading about how well iPhones were selling. She also noted that Apple was aware of the economic slowdown in China and the risk of falling demand.
The main plaintiff in the case is a pension fund from Norfolk, England. The lawyers for the investors might ask for up to 25% of the settlement money as their fee.
Despite this lawsuit, Apple's stock price has gone up more than four times since January 2019. Now, Apple is worth more than $2.6 trillion. The legal case is known as In re Apple Inc Securities Litigation and is being handled in the Northern District of California.
Read next: What's the Most Common Way for Smartphones to Get Damaged?
