fraud

An angry shareholder has dropped a class-action suit that he filed back in May accusing Nokia of fraud. Robert Chmielinski, a Nokia investor, had claimed that Nokia spokespeople, including CEO Stephen Elop, knowingly made false statements about how its Lumia line of Windows Phones would boost their position in the global mobile phone market. The suit was based declining stock prices.

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While Nokia has filed a patent lawsuit against HTC and RIM, the Finnish company is now on the receiving end of litigation. Robert Chmielinski, a Nokia investor, has filed a class action suit in U.S. Federal Court claiming Nokia made false and misleading comments on its Windows Phones and how the new phones would effect the company's position in the market.

The complaint was filed in the Southern District of New York and cites several statements from Nokia's CEO Stephen Elop where he spoke of the company's plans for success with the Lumia Windows Phones.  The claim also cites industry experts who claimed Nokia had all the right tools to win the smartphone game.  Chmielinski sees these as false statements and fraud because Nokia's market shares have declined and the Lumia 900 had a software glitch which resulted in $100 credit to customers, making the Lumia 900 basically a free phone for most consumers.

"Defendant's statements set forth above were materially false and misleading because Nokia's migration to a Windows platform was not going as well as represented. The Lumia 900 had a glitch which forced Nokia to offer a $100 credit and earlier Lumia offerings were not as well accepted as represented"

Chmielinski feels that due to this fraud, he and the class suffered economic loss that could have been avoided. While the complaint doesn't place a dollar amount, the plaintiffs are asking for damages, interest and costs from Nokia as well as equitable, injunctive or other relief the Court may deem just.

Nokia has issued a very brief response to the litigation saying,

"Nokia is reviewing the allegations contained in the complaint and believes that they are without merit. Nokia will defend itself against the complaint."

So, what do you think? Did Nokia overstep it's bounds and falsely predict the Lumia's success? Or did Nokia simply have a positive outlook and investors knew the risks? Does the term caveat emptor come to mind?

You can find the full complaint against Nokia here.

Source: PCMag; Thanks, Andrew, for the tip!

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