A new lawsuit filed against Apple has accused the company of securities fraud for concealing a slump in demand for iPhones, specifically in China, which apparently led to a $74 billion one-day slide in its market value.
According to Reuters, the class action was filed in the federal court in Oakland, California by the City of Roseville Employees’ Retirement System.
The lawsuit, represented by securities class-action specialist Robbins Geller Rudman & Dowd, seeks damages for investors who bought Apple stock in the two months before CEO Tim Cook unexpectedly reduced Apple’s quarterly revenue forecast as much as $9 billion on Jan. 2.
Cook and Chief Financial Officer Luca Maestri have also been named as defendants in the proposed class action:
The complaint said iPhone demand was falling because of U.S.-China trade tensions and customers’ growing preference to replace batteries in older iPhones, prompting Apple to slash orders from suppliers for new iPhones and cut prices to reduce inventory.
But none of this was disclosed when it should have been, the complaint said, in part because of Apple’s Nov. 1, 2018 decision to stop disclosing unit sales for iPhones.
Apple has not yet issued an official comment regarding the matter.