Related Articles
In June, Research In Motion suffered its worst month to date.
First, a $518 million quarterly loss. Second, its lowest share price
since the company’s peak in 2008. And last, a delay for the forthcoming
line of BlackBerry models and an updated operating system that may make or
break RIM’s future.
Considering this, with RIM’s annual meeting scheduled this week, CEO Thorsten Heins may not be looked upon with friendly eyes by
investors.
More BlackBerry news
- Best Password Manager to Use for 2022
- Your Phone Screen Is Gross. Here’s How to Clean It Without Causing Damage
- Spending All Night With the First iPhone
- Kanye West’s Donda 2 Skips Spotify, 5G BlackBerry is Dead
- BlackBerry’s 5G Phone Is Officially Dead
Displeasure, and investors brooding over their dwindling stake, may not
be the only thing to occupying shareholders’ minds at the meeting. The New York Times
reports that investing parties and security law experts may take the issue
of the BlackBerry 10 delay further, and transform worry over invested capital
into lawsuits.
Combatting opinions of analysts who forecast RIM’s future as nothing more than a “death spiral,”
Heins said in a radio interview last week that “there’s nothing wrong with the company as it exists right
now.”
The perhaps overly optimistic
remarks of Heins have not helped alleviate these concerns.
If the delay of the BlackBerry 10 coincides with documented
statements and quotes from RIM’s management, there may cause for relevant parties to consider company misrepresentation a possibility.
Venture capitalist Jean-Louis Gassee, former president of Apple’s
products division, agrees with this idea. He told the Times:
They’re going to get sued and they should get sued because I think a
closer look at the record is likely to unearth knowing and willful
misrepresentation. When the C.E.O. says there’s nothing wrong with the
company as it is, it’s not cautious, it doesn’t make sense.
But can this lead to misrepresentation, and therefore a stack of court
orders laid at the technology giant’s door? In a recent statement, RIM
rejected the idea that it had misled investors:
RIM is well aware of its disclosure obligations under applicable
securities laws and is committed to providing a high level of
transparency, as evidenced by RIM’s decision to issue an interim business
update on May 29, 2012, to alert shareholders that it expected to report
an operating loss.
This leads to the crux of the matter: securities laws differ in separate
countries. RIM is based in Canada, and its stock is traded across the
United States. In both, however, generally any sudden developments or
changes are notifiable to investing parties — and the delay in the
BlackBerry 10 is such a change.
With so much riding on the success of the product, it is no wonder
Canadian and U.S. law specialists feel that that this development — which
is likely to further impact the company’s financial health — could be
grounds for a visit to the courtroom.
If investors decide to bear arms and take a class action suit against
RIM, they would be required to prove that RIM’s management knew a delay
was a strong possibility at the time Heins was promising on-time delivery.
Over the course of this year, including at a May 1 conference where a
BlackBerry 10 prototype was unveiled, Heins said:
Every day I get questions about the progress on BlackBerry 10. I
appreciate all of the interest on our next-generation platform and I
promise, I promise to you that the whole company is laser-focused on
delivering on time and exceeding your expectation.
We’re making good progress, and I’m committed to sharing the progress with
everyone right up until the launch later this year.
Repeated, documented assurances by Heins and other RIM executives are
the first piece of the puzzle. The next is to discover what changed,
exactly, between the start of May and the end of June, and when Heins
decided the delay of the BlackBerry 10 was necessary. If lawsuits appear on the horizon, then the delay of the smartphone and OS may have additional waves of repercussion for Research in Motion.
RIM was unavailable for comment at the time of writing.
Now playing:
Watch this:
BlackBerry 10 in action
1:45
