Slashdot Mirror
Class-action Suit Filed Against Microsoft Over Surface Write Off
New submitter used2win32 writes with news that at least one investor is unhappy with the Surface inventory write off, claiming that Microsoft mislead investors who purchased stock during Q2 and Q3 by not announcing just how slow inventory was moving at the time "The class action lawsuit claims false and misleading information regarding sales performance of Windows RT based tablets. Microsoft has earned a U.S. $900 million write off and a market share of less that 1% to show for its Windows RT endeavors. Asus, Lenovo, HP, Samsung and HTC discontinued their models leaving Dell as the only OEM producing a Windows RT tablet."
Stockholders win the lawsuit and each get 10 bucks. Microsoft stock takes a huge hit. Stockholders lose a lot more than 10 bucks.
Nevermind, I forgot about the lawyers. The lawyers always win.
Typical sue-happy mentality of the USA: My bad judgement is your fault.
If these people had made money with the stock, do you think they'd be offering to pay Microsoft part of their profits?
Enjoy life! This is not a dress rehearsal.
It's strange that everyone except microsoft saw this coming. None of the tech folks I know thought those tablets were gonna go anywhere---why in the world did Microsoft spend so much on such a bad idea? Same with the phones...
"If anything can go wrong, it will." - Murphy
The summary says that is not what the lawsuit is about. Surface was clearly not doing well in the first two quarters of its release (Q2, Q3) but MS didn't disclose this until Q4 when they took a $900M writeoff. I'm not sure what the rules are on reporting but I'm guessing the losses were just too large not to report. The lawsuit claims investors who bought stock in Q2 and Q3 were misled by this lack of information. MS does put into their financial statements a disclaimer about how poor sales may affect their overall revenue: "significant investments in new products and services that may not be profitable;" The litigants felt that was not enough. I don't think they have much of a case.
Well, there's spam egg sausage and spam, that's not got much spam in it.
Well, maybe they assumed "we're Microsoft, people will buy anything we make", or they were completely out of touch with what consumers actually wanted and missed the mark completely, or maybe they're losing a lot of good-will with people who no longer care about them or their products. Tough to say.
But Microsoft really needs to be asking themselves this. Because this is now several products which are proving to be failures in the market, and the investors aren't going to stand for a company which keeps making billion-dollar gambles on stuff nobody buys.
Right now, except for maybe Office and the enterprise market -- it's hard not to think that Microsoft is losing money on every product they make, and trying to make it up on volume.
Lost at C:>. Found at C.
Only if the company misled about the existence of the lawsuit.
But because even microsoft isn't completely retarded you'll find their 10-K will always have something like:
"""
We have claims and lawsuits against us that may result in adverse outcomes. We are subject to a variety of claims and lawsuits. Adverse outcomes in some or all of these claims may result in significant monetary damages or injunctive relief that could adversely affect our ability to conduct our business. The litigation and other claims are subject to inherent uncertainties and management’s view of these matters may change in the future. A material adverse impact on our financial statements also could occur for the period in which the effect of an unfavorable final outcome becomes probable and reasonably estimable.
"""
in it.
The complaint alleges that Microsoft's first quarter 2013 financial reports were false and misleading. Much of $900 million write down they acknowledged
in the second quarter should have been included in the first quarter statements, they say. If it's true that Microsoft executives knew about the problem and
concealed it in from the investors / potential investors (the owners of the company), that's unlawful, as it should be. That's a fraud on people trying to save
for retirement.
The lawyers will take half the money, so people who were victims of the fraud won't recoup their loss, but punishing fraudulent behavior may tend to
discourage Microsoft and other companies from perpetrating similar lies in the future.
Of course it'll be up to the judge or jury to decide if Microsoft actually did know about the problem by the end of March, in such a way that concealing it
in the first quarter reports mislead investors.