It doesn’t rain, but it pours for HP. In a class action lawsuit shareholder Richard Gammel accused the world's largest technology company of concealing the fact that its existing business model was not working and that webOS -- the operating software it inherited after buying Palm -- was no longer central to its business model reports Reuters.
After the announcement on August 18 it was considering a spinoff of the world's largest PC business, killing off webOS devices such as the TouchPad, and buying British software company Autonomy Corp for $12 billion its share price plunged 20 percent the following day, marking their biggest single-day drop since the Black Monday stock market collapse of 1987.
The lawsuit, filed this week in U.S. District Court by Robbins Geller Rudman & Down, accuses HP executives including CEO Leo Apotheker and CFO Cathie Lesjak of misleading investors by making positive statements about the company's performance that later proved unfounded.
The lawsuit seeks to recover unspecified damages on behalf of any who bought into HP between November 22, 2010, and Aug 18 of this year, arguing that the lack of disclosure about potential issues means its shares were artificially inflated.
