Apple has recently settled a class-action lawsuit with investors, costing the company a whopping $490 million. The lawsuit stems from a statement made by CEO Tim Cook in 2018 that was accused of being misleading. Specifically, at a meeting with investors in November 2018, Cook said the newly launched iPhone model had a “good start” in China. However, the truth was quite different, leading to a 10% decline in the company’s shares in one day.
Following the statement, Apple’s global revenue was approximately $9 billion lower than expected in the most recent fiscal quarter, mainly due to the situation in China. This event marked the first time since the launch of the iPhone in 2007 that the company had to lower its revenue forecast. Investors were alarmed by this news, and $70 billion was wiped away from the hands of those holding Apple shares.
Initially, Apple denied that Cook intended to deceive investors with his statements, but the lawsuit, which lasted over four years, tired the company. As a result, the company decided to settle the case entirely. The settlement is subject to a hearing on April 30, overseen by district judge Yvonne Gonzalez Rogers. Investors who bought Apple shares at the end of 2018 can receive a share of the settlement after deducting $122 million (25%) in legal fees.
