Norfolk County Council beats Apple in £385m iPhone row

The local authority – and others – had accused the tech giant of misleading shareholders.
Norfolk County Council beats Apple in £385m iPhone row
A person on their phone in front of the Apple logoReuters

Apple has agreed to pay $490m (£385m) to settle a lawsuit led by Norfolk County Council.

The class action alleged the tech giant’s boss, Tim Cook, defrauded shareholders by covering up lower demand for iPhones in China.

Norfolk Council said a pension fund it administered lost money as a result of Mr Cook’s actions.

In a statement, the Norfolk Pension Fund said it was “very proud of this recovery for investors.”

The statement continued: “We are mindful that we are stewards of pensions relied upon by thousands of families and individuals.

“When and where it’s warranted, we will take decisive action to recover losses when our participants’ investments are harmed by fraud.”

The BBC has approached Apple for comment.

The class action lawsuit – meaning it is on behalf of a group of claimants – centred around comments made by Apple’s chief executive Tim Cook.

He told investors on 1 November 2018 that there was “sales pressure” in some countries but he “would not put China in that category.”

However, two months later, on 2 January 2019, Apple downgraded its quarterly revenue forecast, citing tensions between China and the US – leading to a sharp drop in Apple’s share price.

Within that two-month window, reports emerged that Apple had told its top smartphone assemblers to “halt plans for additional production lines” for the recently released iPhone XR.

The claimants in this case were all investors who had bought shares between November 2018 and January 2019.

They said they lost money because they had been falsely reassured by Mr Cook’s comments in November.

The case was originally brought against Apple and Mr Cook by the US city of Roseville. Norfolk Council, which administers the £4.9bn Norfolk Pension Fund, took over the lawsuit as lead plaintiff in 2020.

Apple had fought the litigation, and a trial was scheduled for later this year. This preliminary settlement – filed on Friday with the U.S. District Court in Oakland, California – should mean that will no longer happen, however it still requires approval by a judge.

It is not known what portion of the settlement Norfolk County Council will receive.

Apple posted $97 billion of net income in the last fiscal year. The pay-out equals a little under two days of profit for what is one of the world’s wealthiest companies.

Source: bbc.co.uk

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