Angry investors start class action against Microsoft over Surface RT losses

Angry investors start class action against Microsoft over Surface RT losses
A new class action suit filed by Robbins, Geller, Rudman, & Dowd has accused Microsoft of hiding major losses related to its Surface RT tablet.

Last month, the company reported its quarterly earnings and had to take a $900 million write-off for inventory adjustments and the recent 30 percent price cut made on the failed tablet.



The complaint accuses the software giant of "materially misrepresenting the true financial effect" that the tablet was having on the company's businesses and that it failed to tell investors about the excess inventory of Surface RT it was hoarding at the time.

By failing to alert shareholders, the company violated "generally accepted accounting principles" and "SEC rules and regulations."

Reads the suit (via AllTD): "What Defendants knew, but failed to disclose to investors, however, was that Microsoft's foray into the tablet market was an unmitigated disaster, which left it with a large accumulation of excess, over-valued Surface RT inventory. Defendants' materially false and misleading conduct enabled Microsoft to forestall Surface RT's day of reckoning and delay what would be tantamount to an admission by the Company that its all-important entry into the tablet market had been a failure."

Following earnings, the company's stock fell 8 percent, destroying over $20 billion in market value. The suit is looking to recover damages for any shareholder who invested from April 18, 2013 until July 18th.

Written by: Andre Yoskowitz @ 14 Aug 2013 22:25
Tags
Lawsuit microsoft surface rt
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  • 5 comments
  • nu2duo

    Didn't Microsoft initially state that they had sold xxxxx amount of Tablets? They sure made it sound like Surface was such a hit but I do not know of anyone owning one. Microsoft you f..d up.

    15.8.2013 00:35 #1

  • dali

    What did they expect? Windows RT is a piece of crap. The worst parts of Windows 8 without anything good on it. And very expensive also.

    "You know, it seems that quotes on the internet are becoming less and less reliable." -Abraham Lincoln.

    15.8.2013 08:55 #2

  • mukhis

    the major problem with surface RT is not its cost or its trimmed down capability, the area where MS FAILED is app optimization. if you consider user experience with the apps, win RT does not come close to iOS/android or even blackberry or windows phone OS! they thought they would come up with a great tablet just by putting a chopped version of windows there.

    honestly, if this would not be the case, i would buy it despite it feels expensive; the reason is that i would get a nice hardware design with full MS office, and other win apps. the sad part is that MS is known to be a good software company, and not a good hardware company.

    ASUS G73JW | Intel Core i7-740QM, 1.73GHz | 8GB DDR3 | Nvidia GeForce GTX 460M, 1.5GB | OCZ 120GB SSD + Seagate 500GB Hybrid 7200rpm | 17.3" FHD/3D | Blu-ray Write | Win7Pro64

    15.8.2013 12:07 #3

  • SuckRaven

    It's called gambling. No one forced these people to "invest", so they ought to suck it up and shut up. And yes, the sales have sucked. So what? These people are worse than taking candy away from a baby. Jeez!

    SuckRaven

    15.8.2013 13:04 #4

  • Bozobub

    Originally posted by SuckRaven: It's called gambling. No one forced these people to "invest", so they ought to suck it up and shut up. And yes, the sales have sucked. So what? These people are worse than taking candy away from a baby. Jeez!
    Well, if M$ essentially lied to investors, as implied here, the plaintiffs should win a lawsuit. Fraud/deceit is not part of the risk burden investors are legally expected to carry.

    15.8.2013 17:29 #5

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