Period: Dec 6, 2007 to Jan 22, 2008
Lead Plaintiff Deadline: Mar 22, 2010 + Deadline passed
Summary of Case:
A securities class action has been filed against Motorola, Inc. (2010) (MOT) ("Motorola" or the "Company") on behalf of all securities purchasers from December 6, 2007 through January 22, 2008, inclusive ("Class Period"), in the United States District Court for the Northern District of Illinois.
The complaint alleges that during the Class Period, Motorola spokespersons made numerous positive statements about the Company's latest product offering, the RAZR2 handset, to analysts and investors. As it turns out, these statements were materially false and misleading because they failed to disclose the following adverse facts, among others: (i) RAZR2, which went on sale in the U.S. in August 2006, failed to attract buyers in the 2007 holiday season because it was not different enough from the original RAZR to warrant the $299 price tag; (ii) as a result, Motorola was losing significant market share to Apple, Inc.'s iPhone, Samsung Electronics. Co.'s Sync camera handset and Nokia Oyj's devices, among others; (iii) though the Company reported having sold 900,00 of the new RAZR2s between August 2007 and September 31, 2007, the Company was only on track to sell a total of 1.5 million RAZR2s between October 1, 2007 and December 31, 2007; and (iv) Motorola's senior executives knew the Company was not on track to achieve anywhere near the $0.12-$0.14 per share in profits Motorola's executives promised on December 6, 2007.
On January 22, 2008, Motorola issued a release reporting Motorola's 4Q 07 financial results, followed by an earnings conference held with the investment community later that day, during which this information was finally disclosed to investors. Significantly, Motorola's senior executives expressly conceded that they knew demand for the RAZR2 was lackluster dating back as early as Thanksgiving 2007 - two weeks before the start of the Class Period. Defendants also downgraded their 1Q 08 earnings guidance. As the market reacted to these disclosures, Motorola shares plummeted 18.8%, or $2.31 per share, to close at $10.01 per share, its lowest level in five years, on unusually high volume.
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.