Apple's AuthenTec buy already being investigated for class-action suit
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.
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.
Comments
Lawsuits are not really "investigations". I think describing them either as class-action legal trolling or shareholder revolts would be more accurate.
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Originally Posted by SpamSandwich
Lawsuits are not really "investigations". I think describing them either as class-action legal trolling or shareholder revolts would be more accurate.
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.
so they're fishing for a lead plaintiff as opposed to actually doing any investigation ...
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....
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Originally Posted by Pooch
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.
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 ...
Yeah, Apple has billions in the bank so you bet it is worth investigating whether there is cause for a lawsuit. ;-)
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Originally Posted by Wurm5150
Jeez, Mary, and Joseph..
...on a bicycle.
Many lawyers like these need to be disbarred.
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.
Quote:
Originally Posted by mjuarez
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.
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.
Quote:
Originally Posted by msimpson
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.
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!
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Originally Posted by sd-diver
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.
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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.
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'.