Norfolk County Council takes Apple to court
PUBLISHED: 11:42 07 November 2020 | UPDATED: 09:32 08 November 2020
Norfolk County Council is suing Apple over claims the multinational technology giant misled investors about its iPhone sales.
The local authority, which runs a Norfolk Pension Fund valued at £3.8bn, holds an undisclosed amount of shares in Apple.
A council spokesperson said: “We are a part of the class action against Apple to do with pension involvement and cannot comment further because there is live litigation.”
As part of the legal fight, the world’s most valuable firm is accused of concealing weak demand for its handsets before it put out a profit warning in January 2019.
It alleges Apple boss Tim Cook made “false and misleading” statements on a call with analysts on November 1, 2018, when he said the company was not facing sales pressure in China.
Days later the media reported California-based Apple was reducing production of the new iPhone XR due to lower than expected demand.
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By January, the technology boss admitted to investors the firm would miss its profit forecasts by about £6bn.
The county council has argued Mr Cook must have known in November 2018 the new iPhone was not selling as strongly as Apple had hoped.
On Wednesday, November 4, US District Judge Yvonne Gonzalez Rogers said shareholders led by a UK pension fund could sue over Mr Cook’s comment made in November 2018, during an analyst call.
During a conversation that Apple was facing sales pressure in some emerging markets, the firm’s boss said: “I would not put China in that category.”
But falling demand for iPhones in China resulted in billions of dollars of investor losses.
Apple told suppliers to slow down production a few days after Mr Cook spoke in 2018, and by the following January its quarterly revenue forecast tumbled by up to $9bn, which he partly blamed on pressure on China’s economy from US-China trade tensions.
In a 23-page decision, Judge Rogers said that while Mr Cook might not have known specifics about “troubling signs” in China that the company had begun seeing, it “strains credulity” he would have been in the dark about the trade tensions and their possible impact on Apple.
Apple said there was no proof it misled investors.
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