After allegations that Apple Chief Executive Tim Cook defrauded shareholders by concealing falling demand for iPhones in China, the company has agreed to pay $490 million to settle a class-action lawsuit.
Apple filed a preliminary settlement with the US District Court in Oakland, California, on Friday and it requires approval by US District Judge Yvonne Gonzalez Rogers.
The lawsuit stemmed from Apple’s announcement on Jan 2, 2019 that the iPhone maker would slash its quarterly revenue forecast by up to $9 billion. The cut in quarterly revenue forecast was blamed on the US-China trade tensions.
On a Nov 1, 2018, analyst call, Cook told investors that although Apple faced sales pressure in markets such as Brazil, India, Russia and Turkey due to weakened currencies, “I would not put China in that category.”
A few days later, Apple told suppliers to curb production.
It was Apple’s first lowered revenue forecast since iPhone’s launch in 2007. Apple’s shares fell 10 per cent the next day, wiping out $74 billion of market value.
Apple and its lawyers did not immediately respond to requests for comment on the ruling.
