Apple settles for $490 million in lawsuit over CEO's 'misleading' sales comments

Apple has reached a settlement in a lawsuit filed by a group of investors who alleged that Cook made false statements about the company's business in China, which caused Apple's shares to trade at artificially inflated prices.

Under the preliminary settlement filed with the U.S. District Court in California, Apple has agreed to pay $490 million.

IPHONE SALES IN CHINA DROPPED

The settlement comes at a time when Apple is facing headwinds in China. An independent study released earlier this month reported that the company's iPhone sales in China dropped by 24 percent in the first six weeks of this year.

During an analyst call on November 1, 2018, Cook told investors that although Apple was facing sales pressure in markets where currencies were weakening, "I would not put China in that category."

"COMPANY SHARES HAD DECLINED"

In an announcement on January 2, 2019, Apple lowered its quarterly revenue forecast due to "U.S.-China trade tensions." The day after the revenue forecast was lowered for the first time since the iPhone's launch in 2007, the company's shares fell by 10 percent.

The settlement covers investors who purchased Apple shares in the two months between Cook's comments and the revenue forecast.

News Source: AA