Class action suit averted as appeals court rules that Steve Jobs is not psychic
Some unfortunate investors who purchased AAPL shares between July 19 and Sept 28, 2000 have been told their class action suit against Apple can’t move forward.
A federal appeals court last week upheld a lower court’s ruling that Apple investors cannot sue the company over the fact that the Power Mac G4 Cube didn’t live up to Apple predictions.
The snuffed out suit alleged that Apple knew some of its sales projections were false at the time they made them. The charges were based on a 10% quarterly growth estimate made by then-CEO Fred Anderson and then-controller Peter Oppenheimer’s statements about Apple’s progress in education sales. The appeals court found that the charges were unsupported by the facts.
The Ninth Circuit Court of Appeals said that “companies are to be given leeway because forecasts are by their nature only estimates,” and that the “plaintiffs did not present evidence to show that any problems in the education sales force transition would translate into lower sales for the company.”
The lawsuit accused Steve Jobs of over-hyping sales projections for the Power Mac G4 Cube and ignoring early signs of problems with the Cube, such as the “overly sensitive power switch” “mold lines,” that marred the aesthetics of the Cube’s clear acrylic enclosure.
The court ruled that there was no evidence that Jobs knew of the problems when he introduced the Cube and that “although plaintiffs do allege that Jobs learned that Apple was having significant problems in the manufacture of the Cube during (the fourth quarter of 2000), they fail to allege with specificity when Jobs learned this information, exactly what information was conveyed to Jobs, or that Jobs knew the extent of the problems.”
The moral of the story? Rumors that Apple has secretly been developing an iCrystal Ball are way off the mark.
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Reader Comments (Page 1 of 1)
Al said 4:15PM on 6-16-2005
[sarcasm]
Man, I *so* wish this had gone forward...
Then I could sue Segway for over-hyping THEIR products.
[/sarcasm]
Reply
Small Paul said 4:15PM on 6-16-2005
Jobs not a psychic? Pft. Shows how much the court knows...
Reply
Rick James said 4:15PM on 6-16-2005
If they still own shares they should now be worth more shouldn't they? If you are serious about buying shares it can be a long term investment before you see decent profits
Reply