A preliminary settlement of $490 million was filed with the U.S. District Court in Oakland against Apple’s CEO Tim Cook on Friday.
The class-action lawsuit alleged that Chief Executive, Tim Cook, defrauded shareholders by hiding the declining demand for iPhones in China.
The settlement sum equates to around two days’ worth of earnings for Apple, which according to reports generated $97 billion in net income for 2023.
It began with Apple’s shocking declaration on January 2, 2019, citing trade concerns between the United States and China, that the iPhone manufacturer would cut its quarterly sales projection by up to $9 billion.
During an analyst call on November 1, 2018, Cook informed investors that while Apple was seeing sales pressure in countries where currencies had fallen, such as Brazil, India, Russia, and Turkey, “I would not put China in that category.”
After U.S. District Judge Yvonne Gonzalez Rogers denied Apple’s motion to dismiss the case and scheduled a trial for September 9, a settlement was struck through mediation.
In a hearing set for April 30, Gonzalez Rogers is now being asked to approve the settlement.
A portion of the settlement, which will be allocated from a pool that will be less than $490 million after the lawyers engaged in the lawsuit are paid, may be available to thousands of stockholders who purchased Apple stock in late 2018.
Up to one-fourth, or around $122 million, of the compensation is what the lawyers want to take.
