Feeds

back to article Lawsuit claims Microsoft misled investors in Surface RT fiasco

A US law firm has filed a class-action lawsuit on behalf of Microsoft shareholders, alleging that Redmond misled investors when it failed to alert them to dismally poor sales of its ARM-based Surface RT fondleslabs. According to a press release issued by the law firm of Robbins Geller Rudman & Dowd on Monday, the suit charges …

COMMENTS

This topic is closed for new posts.
Gold badge

If telling the truth, the whole truth and nothing but the truth

without dissembling during calls with investors is to become a standard to which American executives are held, their economy is toast.

6
0

Re: If telling the truth, the whole truth and nothing but the truth

I disagree. At a company as big as Microsoft, not telling the truth to shareholders about stock sales from a previous quarterly statement, is lunacy. It strikes of pure desperation, in terms of gaining confidence to ensure ongoing investment. The problem is that being sued by shareholders is only going to lose the company more money, create even more resentment and friction, which could eventually lead to a catastrophic implosion. Ballmer is an idiot (and according to this information a barefaced liar). Of course even after this latest fuck up, it's most likely he still won't go and the shareholders will just keep on suing to the bitter end. If I were a share holder I'd bypass the legal action and get out fast.

1
0

Remember. In the US you have a God™ given right to make money when you buy stocks. If the market doesn't respond well to a product launch, and you were to oblivious to the blatantly obvious warning signs to see it coming, it is MSFT's fault and they must pay dearly.

They never sue when something goes really well and company execs didn't tell investors in advance. I hate US investors.

7
1

Investors fault?

So you support a companies right to lie to investors, potential or current? And if said investors believe them, then it's their own fault?

The problem here isn't that the market didn't "respond well to a product launch", it was that Microsoft repeatedly LIED about the market response. Ohhhh..... pardon me. They didn't "lie", they over-estimated.

10
0
Silver badge

Re: Investors fault?

So it's basically greed and $ signs flashing before the eyes versus Caveat Emptor and "the value of stocks may go down as well as up" and similar quotes that always get brought out in such cases?

As noted above, due diligence and a little market research would have done wonders here, rather than just rushing headlong into throwing dollars around.

1
0
Silver badge

Due Diligence

This is 100% on the heads of the investors. If they had bothered to try out a Surface for themselves they'd have known it was shit.

If I was the MS lawyer that's how I'd approach it too. Listen here you whiny tosser; if you had bothered to do a little due diligence you'd have seen the problems, but noooo, instead you just threw your money at them and hoped the magic money fairy would multiply your holdings. Well tough shit. It doesn't work that way, keep your own house in order, jackass.

That's probably why I'm not a lawyer though.

9
2
Silver badge

Re: Due Diligence

I don't think they would even have to try one. Just google it (or even bing it) and see what type of response it was getting.

Who do I sue because my mutual funds went down?

And my Captain Crunch didn't stay crunchy in milk! I'm going to sue!

1
0
Law

Re: Due Diligence

"If they had bothered to try out a Surface for themselves they'd have known it was shit."

I had one as a toy (through work) to tinker with.... tried to use it as a daily tablet. It wasn't horrific, I actually liked it. I'd never pay what they were asking for it though, that's why it bombed I think. They were asking mid-range laptop money for a fairly limited heavy tablet. Sub £/$300 and they'd have had a decent response to it I think.

My main issues were fixable with the current gen... the number of stability bugs in the software/drivers (wifi randomly stopped working constantly and requiring reboots to connect again), and the snap-on keyboard-cover died within a couple of weeks of use (replaceable no questions asked by MS though).

No longer using it though, gathers dust in the office with a sign saying "free tablet".

0
0
Anonymous Coward

Re: Due Diligence

"If they had bothered to try out a Surface for themselves they'd have known it was shit."

Clearly you havn't then. Its a lot better and more powerful in many ways than an iPad for instance....

1
5
Silver badge
FAIL

Re: Due Diligence

Indeed the RT and the Pro we got for the office are better than the iPads, for the head. We put the Surfaces in the lab restrooms so people would stop taking their company equipment in there when doing their business.

0
0
Bronze badge

Almost makes me want to buy one share

so I can join in the fun.

2
0

Re: Almost makes me want to buy one share

Well, in some respects, ME TOO. Then again, who really gives a sh*t if idiots (m$ investors) {get hurt | wake up}?

2
0

never understood those shareholder lawsuits

Suing a corporation because the share price is too low?

Current shareholders paying indemnities to previous shareholders?

I'm pretty sure the execs never pay a dime and the lawyers are the only ones profiting from this.

Oh well, not a stock I own.

0
0
Silver badge

Re: never understood those shareholder lawsuits

Almost makes it sound like a Ponzi scheme...

0
0

I get it, but you can't blame the shareholders.

The core issue that everyone harps on is the shareholders should have tried the device or test it. Lets be honest, reviews (both positive and negative) are often inflated, and no shareholder is going to try EVERY product the company produces..

Lets break this down..

A lot of products get negative reviews and still sell very well (either in corporate environments or in other markets).. An example, almost every week I read a blog article of why Apple <insert product> sucks, should I, as an investor listen to the company that makes the product and has a legal responsibility to report the earnings/expenses so investor can make an informed decision, or a bunch of unknowns who often report data based on emotion and does not represent the billions of people on the planet?

And lets get one thing clear.. MS lied to the investors.. there is a legal responsibility for them to report accurate truthful information.. sure they may put a spin on things. and almost every company "adjusts" to make the numbers look better, so investors assume there is a 5 - 10% "fudge" rate... but when you have a 40+% difference, that is not fudge, that is a flat out lie which yes, investors who are looking for real data can not make honest investments.

To give an analogy, if you got married, and your wife said she didn't want kids and you felt the same, and as soon as you get married, she says she wants kids and will.. is that your fault for not checking her our through ex-boyfriends, or her's for not disclosing her true feelings?

4
3

Re: I get it, but you can't blame the shareholders.

'To give an analogy, if you got married, and your wife said she didn't want kids and you felt the same, and as soon as you get married, she says she wants kids and will.. is that your fault for not checking her our through ex-boyfriends, or her's for not disclosing her true feelings?'

You may be not to blame; however you had poor judgement in the choice of a partner. It's like that with company directors: they are always dishonest and mendacious after the stock falls. Stocks rises are your excellent judgement, falls someone else's fault - it's always the same old story on shareholder forums.

As to whether shareholders should have tried the Surface, well of course not everyone invests the same way. Some people will look very closely at the financials, others are chartists. If the company selling a product that nobody wants to buy doesn't figure somewhere in your investment strategy, I don't have a lot of sympathy.

2
0
Facepalm

Microsoft != Pied Piper of Investments

Sorry, investors. If you want more and more money. Don't be too surprised if your greedy little mitts get burnt every once in a while - the value of investments may go down as well as up, every school child knows this.

Read the information available (ALL the information) and you can see, regardless of numbers by MS, the Surface wasn't massively well received in the market, hence it would not have been reasonable to expect any growth large enough to slingshot shares through the roof.

Get real and stop blaming your own failures on someone else, take responsibility for your own lack of thoroughness and diligence. You weren't forced to buy the shares, you had a choice.

2
0
Silver badge

They knew and didn't say

Microsoft knew their Surface RT wasn't selling ( and wasn't staying sold), and didn't say. That's misleading investors. The Surface Pro isn't doiing much better, so more writedowns and lawsuits to come.

2
1
Silver badge

If a business was sued every time they made an unsuccessful product, there would be no businesses, no new products, and lawyers that own everything that is still worth owning.

Did Microsoft not include the relevant nonsense stating "this might not sell"? Who cares - unless investors were lobotomised, they must know this is a possibility.

3
0
Bronze badge

@ Anonymous Coward 101

You've missed the point completely.

MS are not being sued for making a crap/unsaleable product, they're being sued for allegedly lying to investors, and withholding material facts that they are required to divulge by law.

6
0
Silver badge

That's not the point (@ AC, 14th August 2013 08:30 GMT)

"If a business was sued every time they made an unsuccessful product, there would be no businesses, no new products, and lawyers that own everything that is still worth owning."

MS didn't only make an unsuccessful product, they LIED about its sales figures and market acceptance, and, purely by chance, they released the correct info after many investors had lost -some of- their dough. I think the investors have a case, and I hope Ballmer gets served his own ass on a plate.

3
0
Anonymous Coward

Can't you see the difference here?

Yes they made an unsuccessful product. That's not the issue. The point is they continued to present information to potential and current shareholders that the product was fine, when they knew it wasn't selling.

They KNEW they had a near $1billion loss about to happen but hid that fact out of one financial quarter and into the next while continuing to feed vague and misleading information out.

5
0
Bronze badge

Re: they LIED about its sales figures

If they'd come right out and said "everyone thinks it's crap and we can't sell it" what are the chances the investors would have sued them for devaluing the product?

0
0
Bronze badge

The warning signs were there....

Just wait 'til investors realise what a mess Windows8 has turned out to be.

MS had plenty of warnings from users of beta version of 8. Investors could have seen the same warning signs had they read comments on tech sites.

As for Surface and varients, MS has a bad record on me-too products like Zune. As soon as Surface prices were revealed (and the mindless, empty, ads) perceptive shareholders would have jumped ship.

2
0

I thought this was part of the gamble?

You can hardly expect Micro$oft to tell the world the sales are awful - they are trying to market that it's going well, and why haven't you bought one yet?

It does seem a bit silly to sue for something like this, but trading in shares is a funny ol' game.

2
0

Nothing to do with share price or even Surface!

I'm an RT customer, using {outlook,word,excel} on a laptop that's been running two days without a recharge.. I may be one of only a few customers, but I'm a pleased one.

This case will be all about getting Steve Ballmer out of the CEO seat, and getting Bill Gates to take over (at least in the short term).. with Bill in the seat they'll get a price bounce for all shareholding, and not just the ones traded in a relatively short window.

If "bouncing Ballmer" has got nasty enough to try SEC disbarment, heaven knows what's happening round the water-coolers.

2
0
Silver badge

Re: Nothing to do with share price or even Surface!

"I'm an RT customer, using {outlook,word,excel} on a laptop that's been running two days without a recharge.. I may be one of only a few customers, but I'm a pleased one."

I hope you weren't doing work for a business, or you broke the license agreement.

1
0
Meh

Re: Nothing to do with share price or even Surface!

most people who also have desktop Office licences are covered.. and my Office Pro Plus licence me.. but..

.. since I can't run Visual Studio or other dev tools on RT, it just provides another windows for docs/email/web.. while I work on another box.

0
0
Bronze badge
Pint

What a job

Wow, I should really become investment banker and just invest into anything, whenever the stock price of a company falls, I'll simply sue them and get my losses returned, when the stock rises, I will collect my winnings and call it a day.

0
0
Facepalm

Quel surprise

Microsoft fibbed.

Well, knock me down with a feather

1
0
Bronze badge
Facepalm

Re: Quel surprise

Well, let's put it another way.

I risk my money buying stocks from a particular company to support a new product. I won't put all my money in, and I'll try to make contingency plans for the eventuality that the money is going to be lost. This does not include sueing the company since in any situation like this, I can't be sure if legal action would give any return and would cost me money into the bargain.

I would then consider how I monitor the situation regarding these stocks. This would certainly include the company presented information but not to the exclusion of other metrics. I should be able to determine, even if not to the very machine, certainly a rough idea of the numbers being exchanged, and determine any error in representation. I can then act accordingly.

If I do all of the above, then there are all sorts of things I can do before it all goes wrong and only one person can be held responsible if I don't. If I don't do all of the above, then there's only one person I can blame if it all goes wrong.

I'm not a fan of Microsoft by any means, but I can't blame them for risking an attempt to start a market with Windows RT and I can certainly not accept that anyone should be sueing them for it!

0
0

Re: Quel surprise

You're right. In this case, however, investors didn't buy shares to support a product. These weren't new shares. They simply bought somebody else's shares. None of the money went to Microsoft, nor supported a product. This issue simply highlights the foolishness in quarterly results - what can they possibly show in a market with multi-year product cycles?

0
0
Silver badge
Meh

Translation

We took a chance without a proper risk assessment and now want someone else to pay.

1
0
Gold badge

World's smallest violin

Here I am playing the world's smallest viloin *doo doo doooooo*. Do your research before you by stock. Research doesn't mean "look at the company's press releases and believe all the hype". It was clear before this tablet even shipped that public opinion was strongly against it, and that sales would be tepid at best. These stock numptys are a bunch of idiots for thinking they should be able to sue for missing the obvious.

1
0

Can't win

Give the impression it is doing well, get sued by investors.

Say it isn't doing well, scupper your own product's already shaky traction in the market. Then get sued by investors for trainwrecking your own product...

0
0

M$ H8er

Those who are cretin enough to invest in M$ deserve ALL they get.

Like investing in White Star Line when you know what will happen to Titanic.

Everybody on this planet knows that M$ will sink real fast, the only question that remains is "when".

Windows Vista hurt, with Windows 8 and Windows phone, they really tried very hard to die quickly ... and I am not even mentioning surface, xbox one ... name anything from Redmond that has a chance ... right, told ya!

0
0
This topic is closed for new posts.