Adding more than a dozen confidential witnesses and working with a truncated class period, Labaton Keller Sucharow resurrects the securities class action against Hewlett-Packard and reaches a $57 million settlement on behalf of lead plaintiffs and the class.
On September 15, 2014, the court finally approved a $57 million settlement with Hewlett-Packard (HP) on behalf of lead plaintiffs.
Lead plaintiffs alleged that after HP bought Palm Inc., HP announced a new business strategy focusing on its newly acquired webOS operating system and its signature corporate initiative to build that business into a connected "ecosystem" across smartphones, tablet computers, PCs and printers. After months of fanfare, HP announced that it would shut down its webOS efforts, ultimately abandoning its $1.2 billion investment of Palm Inc. WebOS-enabled PCs and printers were never offered for sale. HP stock fell nearly 25 percent on this news.
Lead plaintiffs initially alleged that HP's former CEO Leo Apotheker and current executive vice president Todd Bradley made misleading statements about its commitment and ability to put the webOS products out in the market.
The class action was dismissed in September 2012, but investors were given a second chance to file an amended complaint in late October 2012. This time, the theory was modified to allege that HP recklessly misled the market regarding its plans to put webOS on its PCs and printers in a specific time frame. Labaton Keller Sucharow found an additional 13 confidential witnesses whose accounts were included in the amended pleading. The claims partially survived with the court finding that certain statements from June 1, 2011, forward were actionable.
After HP's motion for reconsideration was denied, the parties went into discovery and ultimately mediation, which resulted in a $57 million settlement.
The case is In re Hewlett-Packard Company Securities Litigation, No. SACV 11-1404 AG (RNBx). Lead Plaintiffs are Arkansas Teacher Retirement System, Union Asset Management Holding AG, Labourers' Pension Fund of Central and Eastern Canada, and the LIUNA National (Industrial) Pension Fund and LIUNA Staff & Affiliates Pension Fund. Defendant is Hewlett-Packard.
Settlement Hearing
A settlement hearing was held on September 15, 2014, at 10:00 am before the Honorable Andrew J. Guilford in courtroom 100 at the United States District Court for the Central district of California, 411W. Fourth Street, Santa Ana, California, 92701.
The deadline for objecting to the settlement or seeking exclusion from the class has passed.
