Nokia sued by investor for using Windows Phone

An upset investor filed a complaint against Nokia for its choice of Windows Phone. Robert Chmielinski, represented by Robbins Geller Rudman & Dowd LLP, is suing on behalf of all investors who purchased Nokia stock between Oct. 26, 2011, and April 10, 2012. Stephen Elop, Nokia's CEO, and Timo Ihamuotila, Nokia's CFO, are also listed as defendants.

The complaint alleges federal security laws violations by Nokia and some of its officers and directors, including Elop and Ihamuotila, specifically in regards to the Securities Exchange Act of 1934. According to the complaint, Nokia violated federal security law when it stated its Windows Phone partnership with Microsoft would halt the company's financial slide, which the complaint considers  to be "false and misleading statements."

Defendants' statements set forth above were materially false and misleading because Nokia's migration to a Windows Phone platform was not going as well as represented. The Lumia 900 had a glitch which forced Nokia to offer a $100 credit and earlier Lumia offerings were not as well accepted as represented. 

Filing of the complaint comes a week after Nokia was hit with two "junk" credit rating drops from separate credit rating agencies. Nokia has seen lackluster sales figures despite dominating the Windows Phone market.

The complaint was filed in the United States District Court for the Southern District of New York. Robbins Gellar Rudman & Dowd is a firm that specializes in class-action lawsuits; the company has some of the "largest recoveries in history," including a class action recovery of $7.2 billion from Enron. The company is giving potential plaintiffs 59 days from today to seek lead plaintiff status.

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22 Comments

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This guy is an idiot - the statement made by the CEO comes with the usual disclaimer attached, it is a forward looking statement the tis dependent on a number of factors. The fact that the idiot bought shares from October 2011 to April 2012 (6 month window) and expecting a turn around is a moron - he should be chained to a fence post and beaten without the slightest hint of mercy.

the company was in the **** long before WP and elop came along, Symbian was a sinking ship and the newer os did nothing to improve the situation. After all this they switched to WP and if you look at the actual stats for all of this over the past 3 years you will see that until WP came along nokia was in free-fall, since the adaption of WP they are actually starting to climb out of the hole that Symbian left, this investor is full of crap.

I bought a bunch of NOK in pre-market extended trading the morning after the move to Windows Phone was announced. When the market opened, the stock started plummeting, so I liquidated and shorted to recoup my loss. Guess Chmielinski should have done the same thing, or understood that investment has inherent risk no matter what's promised.

Nokia said the WP/Microsoft partnership would put an end to their financial slide. That much they qualified, but they never said when to expect this so called recovery to occur.

Any reasonable person/investor would agree that it takes time for this to occur, and that there hasn't been a sufficient amount of time to consider the recovery a failure or a success.

What does this guy expect, an instant cure?

Umm...this guy knows that investment requires risk, right? And that risk implies that things might not work out, even if you do all the right things (probabilistic universe and all that) ?

lordcanti86 said,
Umm...this guy knows that investment requires risk, right? And that risk implies that things might not work out, even if you do all the right things (probabilistic universe and all that) ?

I'm pretty sure he does, he's a business and legal consultant..... this is just a guy whining that he isn't making money fast

It seems the guy just wants to take advantage of the situation for personal gain.

And if he truly believes the partnership is doomed then he's one shortsighted investor.

zhiVago said,
It seems the guy just wants to take advantage of the situation for personal gain.

And if he truly believes the partnership is doomed then he's one shortsighted investor.


This so much.
He should spend his money elsewhere.

GS:mac

This will never go through. The stockholder would not have given the company adequate time to turn the company around. Given the time frame in which he purchased the stock, at best it will be viewed as a person taking advantage of an opportunity to sue and nothing more. Holding a company responsible for an expected rough patch during a transition would open the doors for legislation whenever a company is going through a restructuring. It would be detrimental to the long term success of companies as well as their existing shareholders, as it would now make more sense to dissolve common stock and reincorporate during a restructuring.

M_Lyons10 said,
This will never go through. The stockholder would not have given the company adequate time to turn the company around. Given the time frame in which he purchased the stock, at best it will be viewed as a person taking advantage of an opportunity to sue and nothing more. Holding a company responsible for an expected rough patch during a transition would open the doors for legislation whenever a company is going through a restructuring. It would be detrimental to the long term success of companies as well as their existing shareholders, as it would now make more sense to dissolve common stock and reincorporate during a restructuring.

This would never go through regardless. He'd have to show criminal neglect of duty of persons involved. Investment involves risk

MrHumpty said,

This would never go through regardless. He'd have to show criminal neglect of duty of persons involved. Investment involves risk

Absolutely. I agree with your point as well. I was actually just coming back to add that. LMAO Talk about a ridiculous law suit.

M_Lyons10 said,
This will never go through. The stockholder would not have given the company adequate time to turn the company around. Given the time frame in which he purchased the stock, at best it will be viewed as a person taking advantage of an opportunity to sue and nothing more. Holding a company responsible for an expected rough patch during a transition would open the doors for legislation whenever a company is going through a restructuring. It would be detrimental to the long term success of companies as well as their existing shareholders, as it would now make more sense to dissolve common stock and reincorporate during a restructuring.

I don't think it will go through either, but I'm no law expert. The firm that's handling this case is massive and one of the most well-known class-action firms in the country. Maybe they know something we don't?

But, basically, I think it's not going to go through because companies can't predict the future. It's not lying to say if you think something will happen. If the facts indicate that, then you say it. The only way this case has merit is if they can prove Nokia knew of certain issues, like the Lumia design problem, or if they lied about any of their previous statements.

shra1 said,
Wow! And this guy hopes for the Company he's invested in, to turn around. Amazing...

Yeah, look at when he bought the stock? Suspicious.