Andre Yoskowitz
4 May 2012 21:17
Nokia has been sued by angry investors this week over the sad turn of events in the company's fortunes over the past year.
Robbins, Geller, Rudman & Dowd, the New York-based law firm, is in charge of the class action suit which names the company, CEO Steven Elop and CFO Timo Ihamuotila.
The suit itself claims that Nokia failed to "halt its deteriorating position in the smartphone market" and withheld that info from its shareholders. When Nokia first announced Windows Phone devices last October, the company's stock was above $7 per share. As of today, the price is 57 percent lower, at $3.15 per share.
Reads the suit: "Two million Lumias in three months is not encouraging; that's the same number that the Nokia N97 (a product which was a large-scale failure) shipped back in 2009, in first three months. Today, if you bring a hit product to market, 5 million in three months should not be a problem (Samsung Galaxy S2). In addition, 10 million Symbian smartphones shipped was expected, but the 16 per cent gross margin in smartphones says these phones were shipped with big discounts in order to defend market shares."
Nokia, which at one time controlled over 60 percent of the global smartphone market with its Symbian platform, shut down the platform after iOS and Android were released, and now controls less than 5 percent.