Apple's AuthenTec buy already being investigated for class-action suit

Posted:
in General Discussion edited January 2014
Following the announcement of Apple's purchase of AuthenTec on Friday, a pair of law firms are "investigating" the security company's board of directors for possible breaches of fiduciary responsibility.

Law firms Levi & Korsinsky and Rigrodsky & Long, P.A. are looking to wrangle shareholder class action lawsuits on allegations that AuthenTec's board of directors purposely undervalued the company in its $356 millon sale to Apple.

Documents released by the two law firms note an investigation is currently underway and ask for shareholders to sign up for representation if a class action suit is indeed initiated.



An online announcement from Levi & Korsinsky notes of the buyout: "Under the terms of the transaction, AuthenTec shareholders will receive $8 per share of AuthenTec stock they own. The transaction has a total approximate value of $350 million."

According to the firm, the "investigation concerns whether the AuthenTec Board of Directors breached their fiduciary duties to AuthenTec stockholders by failing to adequately shop the Company before entering into this transaction and whether Apple is underpaying for AuthenTec shares, thus unlawfully harming AuthenTec stockholders."

Although the investigation is directed at AuthenTec, a suit could affect Apple's acquisition of the company. Neither company has released an official statement regarding the matter.

While Apple's plans for AuthenTec remain unknown, some industry insiders have speculated the company's fingerprint-sensing technology could be integrated into a future iPhone for e-wallet authentication.
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Comments

  • Reply 1 of 45
    SpamSandwichSpamSandwich Posts: 31,087member


    Lawsuits are not really "investigations". I think describing them either as class-action legal trolling or shareholder revolts would be more accurate. :D

  • Reply 2 of 45
    anantksundaramanantksundaram Posts: 19,149member

    Quote:

    Originally Posted by SpamSandwich View Post


    Lawsuits are not really "investigations". I think describing them either as class-action legal trolling or shareholder revolts would be more accurate. :D



     


    Agree. To call this an "investigation" is quite silly.


     


    These sorts of nuisance filings are par for the course in most acquisition announcements. Like the vast majority, it will go nowhere.

  • Reply 3 of 45
    poochpooch Posts: 768member


    so they're fishing for a lead plaintiff as opposed to actually doing any investigation ...

     

  • Reply 4 of 45


    if ANYBODY other than Apple bought them shareholders would be celebrating.....but NO..... Apple STOLE the company, right?????


     


    just add it to the list of reasons why Apple is the most sued company in America.....


     


    one of the unavoidable problems with having $117Bil cash on the balance sheet....

  • Reply 5 of 45
    SpamSandwichSpamSandwich Posts: 31,087member

    Quote:

    Originally Posted by Pooch View Post


    so they're fishing for a lead plaintiff as opposed to actually doing any investigation ...

     



     


    Interesting that it's cheaper to file a lawsuit first instead of actually performing an "investigation". Ridiculous, actually. If there were any justice, Apple would countersue and reduce them to ashes.

  • Reply 6 of 45


    All their shareholders just made a 66% gain in a single day ... 


     


    Good luck finding someone to pity them for not making enough.


     


    Lawyer trolls ...

  • Reply 7 of 45
    mactelmactel Posts: 1,275member


    Yeah, Apple has billions in the bank so you bet it is worth investigating whether there is cause for a lawsuit.  ;-)

  • Reply 8 of 45
    wurm5150wurm5150 Posts: 763member
    Jeez, Mary, and Joseph..
  • Reply 9 of 45
    SpamSandwichSpamSandwich Posts: 31,087member

    Quote:

    Originally Posted by Wurm5150 View Post



    Jeez, Mary, and Joseph..


     


    ...on a bicycle.

  • Reply 10 of 45
    jameskatt2jameskatt2 Posts: 718member


    Many lawyers like these need to be disbarred.

  • Reply 11 of 45
    mjuarezmjuarez Posts: 6member


    Knowing that this is just troll lawyer firms is one thing.  However, the headline on this article is clearly misleading, and should be changed.  "Being investigated" is more like SEC or FTC is investing a company.  As in, serious shit is going on, potential civil and even criminal charges.  This is nothing like that.  ANYBODY can attempt to launch a lawsuit.  See any other recent buyout with a significant premium, there's literally dozens of troll companies falling over each other, trying to launch a class action suit.  Hell, all these companies ever did was pay $600 to Reuters for a press release, and hope that some stupid shareholders will fall for it.  There's no lawsuit, it's just a threat (with a press release), so it sounds "official".  


     


    AppleInsider should be ashamed of themselves for putting this out as news-worthy headlines.

  • Reply 12 of 45
    SpamSandwichSpamSandwich Posts: 31,087member

    Quote:

    Originally Posted by mjuarez View Post


    Knowing that this is just troll lawyer firms is one thing.  However, the headline on this article is clearly misleading, and should be changed.  "Being investigated" is more like SEC or FTC is investing a company.  As in, serious shit is going on, potential civil and even criminal charges.  This is nothing like that.  ANYBODY can attempt to launch a lawsuit.  See any other recent buyout with a significant premium, there's literally dozens of troll companies falling over each other, trying to launch a class action suit.  Hell, all these companies ever did was pay $600 to Reuters for a press release, and hope that some stupid shareholders will fall for it.  There's no lawsuit, it's just a threat (with a press release), so it sounds "official".  


     


    AppleInsider should be ashamed of themselves for putting this out as news-worthy headlines.



     


    As you will learn if you stick around long enough, the excuse is that AppleInsider "isn't a news site, it's a blog"... I still think they should uphold journalistic standards since they are regularly cited by other news sites.

  • Reply 13 of 45
    msimpsonmsimpson Posts: 452member


    Geez, lawyers. I wonder how many of them dream every night about suing Apple and its big cash hoard.  


     


    It would be nice if we had a law that for every frivolous case a lawyer files, and loses, they get an appendage cut off.  A hand or a foot to start.  


     


    Apple paid a 58% premium over what the market had valued AuthenTec at.   If the board of directors had not taken that offer, they could have breached their duty to the stockholders as well.  

  • Reply 14 of 45
    solipsismxsolipsismx Posts: 19,566member
    Makes me want to [I]investigate[/I] blunt force trauma on the heads of these lawyers.
  • Reply 15 of 45
    SpamSandwichSpamSandwich Posts: 31,087member

    Quote:

    Originally Posted by msimpson View Post


    Geez, lawyers. I wonder how many of them dream every night about suing Apple and its big cash hoard.  


     


    It would be nice if we had a law that for every frivolous case a lawyer files, and loses, they get an appendage cut off.  A hand or a foot to start.  


     


    Apple paid a 58% premium over what the market had valued AuthenTec at.   If the board of directors had not taken that offer, they could have breached their duty to the stockholders as well.  



     


    Technically, most companies would "shop around" their company to make certain they were getting the best return on the sale of their company, but I suppose if the premium was high enough, as it appears to be in this case, there may be less of an argument to be made.

  • Reply 16 of 45
    sd-diversd-diver Posts: 53member
    gyro.mac wrote: »
    if ANYBODY other than Apple bought them shareholders would be celebrating.....but NO..... Apple STOLE the company, right?????

    just add it to the list of reasons why Apple is the most sued company in America.....

    one of the unavoidable problems with having $117Bil cash on the balance sheet....

    I can hear it now - "Apple used a shill company to buy our company and cheat our share holders". We now want 1000 times more!
  • Reply 17 of 45
    mjuarezmjuarez Posts: 6member

    Quote:

    Originally Posted by sd-diver View Post





    I can hear it now - "Apple used a shill company to buy our company and cheat our share holders". We now want 1000 times more!


    It sounds stupid, but that's exactly what happened in China with the iPad trademark.  Shell company set up by Apple bought it for $50K, when iPad was nowhere close to being the household name it is now.  A big part of the lawsuit, I think, was that Apple was not honest about it.  Apple ended up paying them $60M I think.  That's OVER 1000 times what Apple had ALREADY paid.


     


    I honestly think in this case, these troll lawyer firms have no case.  58% premium to current market closing price is as good as it gets.

  • Reply 18 of 45
    radjinradjin Posts: 165member
    Lawyers shopping for peoples money to take as class actions are useless for getting individuals any money. The whole thing was likely started by Samsung or another company who uses the companies services.
  • Reply 19 of 45
    radjinradjin Posts: 165member
    [quote]Technically, most companies would "shop around" their company to make certain they were getting the best return on the sale of their company, but I suppose if the premium was high enough, as it appears to be in this case, there may be less of an argument to be made.
    [/quote]

    Likely they had not even considered a sale to anyone. Then along came Apple and they started working together. Once Apple realized they are worth having they made an offer. Totally legal. No shopping required.
  • Reply 20 of 45
    charlitunacharlituna Posts: 7,215member
    gyro.mac wrote: »
    if ANYBODY other than Apple bought them shareholders would be celebrating.....but NO..... Apple STOLE the company, right?????

    just add it to the list of reasons why Apple is the most sued company in America.....

    one of the unavoidable problems with having $117Bil cash on the balance sheet....

    Yep. As I recall the stock is only valued at like $5 a share. But because it's Apple folks think they should get like $800 a share 'because Apple can afford it'.
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