Stock holder sues HP execs for rosy outlook
Hewlett-Packard (HP) is being sued by a stock holder who accuses executives of painting a deceptively rosy picture of the computer company's prospects.
Richard Gammel filed a suit in federal court in Southern California and asked a judge to give it class-action status to represent everyone who acquired HP stock between November 22 of last year and August 18.
The world's largest computer maker "issued materially false and misleading statements regarding the company's business and financial results," lawyers representing Gammel charged in court documents available online Thursday.
The suit specifically targeted HP chief executive Leo Apotheker and chief financial officer Catherine Lesjak.
HP misled investors about the health of its personal computer business and the potential for a webOS mobile operating system obtained by the acquisition of Palm to be a "game changing event" for the company.
Last month HP said it planned one last production run of its TouchPad tablet computer powered by webOS, which became a hot seller following a price cut and the announcement the company was killing the tablet computer.
Citing disappointing sales, HP, the world's largest personal computer maker, announced on August 18 that it was ending production of the TouchPad, its rival to Apple's iPad, after just seven weeks on the market.
Palo Alto, California-based HP also said it was halting production of phones based on the webOS mobile operating system acquired from Palm last year for $1.2 billion.
HP also announced in August that it was exploring a spinoff of its PC unit in a historic shift away from the consumer market.
(c) 2011 AFP