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Nokia Faces Class-Action Suit Over Windows Phone Deal

Posted by Soulskill on from the barn-doors-and-horses dept.

nk497 writes "Nokia has been hit with a class-action suit, with the claimant accusing the company of making 'false and misleading' statements about the ability of its deal with Microsoft to revive the struggling mobile maker. 'The complaint alleges that during the Class Period, defendants told investors that Nokia's conversion to a Windows platform would halt its deteriorating position in the smartphone market,' read a statement (PDF) from the law firm Robbins Geller Rudman and Dowd. 'It did not.'"

10 of 257 comments (clear)

  1. Another ridiculous lawsuit by yog · · Score: 2, Interesting

    It just proves that in America, you can sue anybody for anything.

    Nokia's defense would obviously be that market conditions changed, they could not possibly know the future, and all business decisions are inherently risky.

    Also, given that Microsoft invested hundreds of millions of dollars into Nokia, their decision to go with Windows phone OS can hardly be regarded as the riskiest of choices. When one of the world's largest corporations invests in you, you are not going to go out of business the next day, or the next year.

    That said, I believe Nokia would be better off turning their engineering expertise to producing some Android phones, to take advantage of the enormous app market. They are capable of making a great phone, but their operating systems have been marginalized by the success of Apple and Android. So why not go with one of the winners?

    Plus I can say from personal experience that their support for developers has been shaky, what with all but dropping support for Java, then releasing the N7 and N9, then dropping them in favor of Windows Mobile. What are they going to surprise us with next month? It's safer to stick to an established and relatively stable market such as Android or IOS.

    --
    it's = "it is"; its = possessive. E.g., it's flapping its wings.
    1. Re:Another ridiculous lawsuit by Anonymous Coward · · Score: 5, Interesting

      It just proves that in America, you can sue anybody for anything.

      Uh...yeah? That's the way the system works. Anyone can bring an action against anyone else and the court must hear it.

      I could file paperwork with my local court saying you are a douche and that somehow harmed me. They would read through the documents and (probably pretty easily) come to the conclusion that I haven't made a case that you broke the law and/or harmed me and throw it out.

      Some cases aren't as clear-cut as my example and require a judge and jury to decide.

      Could you imagine if we used your model? You can't sue anybody for anything--only stuff I think is legit. That would put you in a fairly powerful position....something like 'dictator' or whatever.

    2. Re:Another ridiculous lawsuit by fuzzyfuzzyfungus · · Score: 5, Interesting

      Eh, I wouldn't be so quick to dismiss it.

      If you look at various SEC mandated, or voluntary, disclosures from publicly traded companies, you'll almost always see something like this example from Time Warner.

      Legally, distinguishing between statements of fact and 'forward looking statements' makes a difference. It's like the securities equivalent of the “These statements have not been evaluated by the FDA. This product is not intended to diagnose, treat, cure or prevent any disease.” tag you always see on 'dietary supplements'.

      So, if some optimist was given information that constituted a forward looking statement, with the usual boilerplate, about what Nokia hoped their strategy would do, they can go shove it. If Nokia outright claimed that this move would have a specific, definite effect, on their market position or stock price, Nokia may well have shoved their foot in their mouth, good and hard...

    3. Re:Another ridiculous lawsuit by Anonymous Coward · · Score: 4, Interesting

      Also, given that Microsoft invested hundreds of millions of dollars into Nokia, their decision to go with Windows phone OS can hardly be regarded as the riskiest of choices. When one of the world's largest corporations invests in you, you are not going to go out of business the next day, or the next year.

      Except that Nokia intentionally and dramatically increased this risk by killing MeeGo, which is a production quality OS which kicks the shit out of Android and Windows Phone 7.

      I believe it's highly likely that Elop is acting in bad faith. However, unless a high ranking Nokia exec leaks information, I don't think there will be any tangible evidence against him.

    4. Re:Another ridiculous lawsuit by oakgrove · · Score: 1, Interesting

      Slashdot is done. It's little more than copy-pasta'd talking points between the shills and the fanboys at this point. The signal to noise ratio has dropped through the floor. It's pretty sad. The only way for anything to change for the better would be for geek.net to step in and start actively deleting comments and they don't seem to be interested in doing that. I'd suggest dropping the AC posting ability too. Also, new accounts should have a cooling off period. Say 3 days maybe. Who knows what it would take but Slashdot/Engadget/ZDNet/Disqus etc. are all overrun by the various shill factions.

      --
      The soylentnews experiment has been a dismal failure.
    5. Re:Another ridiculous lawsuit by c.r.o.c.o · · Score: 3, Interesting

      The difficulty with the N900 was that they introduced one phone. As an N900 user (still) I know that the N900 is not for everyone, and was targeted more at the tech-savvy user than your bog standard just-want-a-phone-that-works user. Not everyone wants a built in keyboard or a phone that large. In fact, one of the reasons I haven't changed phone is that it is so difficult to get a decent phone with a slide-out keyboard, similar the the N900. Suggestions welcomed...

      Nokia needed to produce several phones around a similar theme aimed at different users, or do what Apple did and produce one phone to a very high standard aimed at the average user, not at a niche market (80/20 rule). Doing what they did was narrow minded and poor business sense.

      This issue was discussed extensively on talk.maemo.org, but you are mostly correct. I had an N900 for a very long time, and not only did it have an awkward form factor due to its bulk and resistive screen (some UI elements were only accessible with the stylus), the hardware also had an enormous defect. The USB port would fall out even without being abused. At first Nokia denied the issue outright, but then started replacing the damaged phones. Which phone you'd get would be anyone's guess, ranging from the N900, N8 or E7.

      I still loved it though, and with care and a couple of mods my USB survived. I loved the fully customizable interface (for instance one thing that just pisses me off about Android is the desktop grid that insists on spacing icons miles away from each other unless you run alternative launchers). I loved the true Linux repositories and apps that did not have ads. Yes, developers should be able to make money, but on the N900 people developed apps like they do on Linux, because it's fun and interesting. And I never found myself missing any features because some random Android app did not have an N900 equivalent.

      The N900 was not without other problems. In Canada on my carrier I could only get Edge, not 3G. The hardware, while high end when the phone was released, is really old now and you could feel it. But most importantly, Nokia gave up on it only a year after its release. Ditching a high end, $700 phone so quickly is inexcusable. Their infrequent software updates, left bugs that were never fixed until the CSSU took over.

      And you simply can't maintain a community around a single device. Eventually my N900 broke down when I crashed my bike, and when faced with replacing it I opted for a much faster Android. Many lead developers for the N900 went the same route, and I can't blame them.

      So yes, Nokia should have released several devices running Maemo 5, and should have continued development of that platform. Jumping to Maemo 6, then Meego, then Windows only made them waste time and resources. I disagree with the need to always have a bleeding edge platform, which is why Maemo 5 was abandoned. Take the Samsung Galaxy Note for instance, which shipped with Android 2.3.5, a year and a half old OS and is extremely popular.

      Nokia's support for developers was, frankly, not an enjoyable experience. This is where being part of the Windows universe will be an advantage to Nokia as that will be Microsoft's responsibility, not their own.

      So they gave up control over half their product to a company that is known to release crappy OSes. Development and support may no longer be Nokia's responsibility, but it definitely affects its bottom line.

  2. Does "class action suit" not mean what it used to? by Chrisq · · Score: 4, Interesting
    From TFA:

    Filed in New York by a single complainant, the class-action suit....

    Surely if there is a single complainant then this should not be a class action suit?

  3. Re:Big Surprise! by oh_my_080980980 · · Score: 2, Interesting

    Again, management claimed all was right and performance would improve. If management knew this was untrue, then management was lying to investors, which is illegal.

  4. Re:The ole' Embrace and Extend by gtall · · Score: 2, Interesting

    I hate Microsoft like Satan hates his mother-in-law, but there's very little chance what you said is true. Some high profile cases have gone down the toilet hole, but a company the size of MS must work with hundreds of companies none of which would bother with MS if what you said was true.

  5. Microsoft had a reason to destroy Nokia by Sara+Chan · · Score: 4, Interesting

    Microsoft had a great reason to fear, and to conquer, Nokia: the Nokia N900. The N900 was arguably the best device ever: a full computer in a mobile form factor. It just needed some polishing of the user interface. Had the polishing been done, Nokia could have been on top of the smartphone market.

    With the planned successors to the N900, people would no longer need separate phones and computers. They would just have their Nokia N900-successor, carrying that with them all the time. At home, or in the office, they would attach a keyboard wirelessly and plug in a screen--and there is their computer. This would have led to a revolution in the way both computers and phones are considered.

    The N900 ran Linux. So the N900 was a vector for getting rid of Windows. Microsoft saw the threat, presumably, and moved to destroy it.