Report: RIM could face shareholder action - Mobile World Live

Report: RIM could face shareholder action

09 JUL 2012

RIM could be facing legal action from disgruntled shareholders, following “overly optimistic” comments made by Thorsten Heins, its CEO, according to the New York Times (NYT).

In recent weeks, the executive has made a number of appearances in the press defending the company, while during the same period it has reported a quarterly loss, falling revenue, job cuts, and delays to its next-generation BlackBerry 10 operating system.

In a statement issued on 29 May 2012, RIM said that BB10 was “still on track to launch in the latter part of calendar 2012.” However, by the time of its results release one month later, this was “now scheduled for Q1 of calendar 2013.”

According to the NYT, venture capitalist and former Apple exec Jean-Louis Gassee has said: “they’re going to get sued and they should get sued because I think a closer look at the record is likely to unearth knowing and wilful misrepresentation.”

RIM said in a statement that it is “committed to providing a high level of transparency, as evidenced by RIM’s decision to issue an interim business update on 29 May 2012, to alert shareholders that it expected to report an operating loss.”

The challenge for a lawsuit would be in proving how much was known about the delay to BB10 at the point which Heins made his comments, and if investors were misled by the statements issued by the company.

However, the report also suggested that with RIM’s share price sliding following its recent news, “the market speaks before any adjudication body.”

In addition, as head of RIM, it is Heins’ job to portray the company in the most positive light – as Jill Fisch, a professor at the Unviversity of Pennsylvaina Law School told the paper: “Everybody expects the chief executive to put an optimistic spin on the company.”

RIM is likely to come under pressure from shareholders at its AGM, which is scheduled to take place tomorrow.

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Steve Costello

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