CASES
Hewlett-Packard Co.
Class Period: Nov 22, 2010 to Aug 18, 2011
Lead Plaintiff Deadline: Nov 14, 2011 + Deadline passed
Summary of Case:
A securities class action has been filed against ("HP" or the "Company") on behalf of all persons who purchased or otherwise acquired HP common stock. between November 22, 2010 to August 18, 2011. This case has been filed in the USDC - California (Central).
The complaint alleges that during the Class Period, Defendants issued materially false and misleading statements regarding the Company's business and financial results. As a result of Defendants' false statements, HP's stock traded at artificially inflated prices during the Class Period, reaching a high of $48.99 per share on February 16, 2011.
In July 2010, HP completed its acquisition of Palm Inc., a provider of smartphones powered by the Palm webOS mobile operating system, for $1.2 billion. During the Class Period, Defendants represented that webOS was going to play an integral role in the Company's strategy going forward, including running on HP's new TouchPad tablet PC as well as on all of the Company's PCs by 2012.
Then, on August 18, 2011, HP announced disappointing third quarter fiscal 2011 financial results and issued revised guidance for fiscal year 2011. In addition, HP announced several major shifts in its long-term business model, including that it "will discontinue operations for webOS devices, specifically the TouchPad and webOS phones." As news began to leak into the market, on August 18, 2011, HP's stock declined $1.88 per share, to close at $29.51 per share. The next day, HP's stock price fell to its lowest level in 6 years, trading as low as $22.75 per share before closing at $23.60.
According to the complaint, the true facts, which were known by the Defendants but concealed from the investing public during the Class Period, were as follows: (a) HP's business model was not working, as the Company was unable to leverage its extensive portfolio and scale of products and services in a strategically beneficial manner; (b) webOS, the TouchPad and the PC business were not central to HP's business model and webOS would not be integrated across the Company's entire product line; (c) the TouchPad hardware was inefficient, limiting the degree of effectiveness of the webOS operating system; and (d) based on the foregoing, Defendants lacked a reasonable basis for their positive statements about HP's turnaround, revenue growth rates, market share, new product introductions, diluted EPS, and the Company's ability to deliver upon its long-term growth model.
If you purchased this company's shares during the Class Period and suffered a loss or for further information about the case, please review the links below.