Steve Jobs health revelation triggers lawsuit speculation

Stephen Withers
Friday, 16 January 2009 02:53

Opinion and Analysis

A Reuters report quotes Joseph Grundfest, a former US Securities and Exchange commissioner, as saying that Apple would only have a problem if company insiders had made stock trades based on knowledge of Jobs' health before it was made public.

Other experts quoted in various reports suggest one or more suits are almost certain to be launched. One of the main issues seem to be the question of whether statements issued by the company were actively misleading or whether they simply failed to tell the whole story.

For example, if it turned out that Jobs knew at the time that his condition was more serious than the "hormone imbalance" causing a "nutritional problem" that he described in his open letter of January 5, that could be viewed as a misstatement.

But if that was an accurate summary of the medical advice he had been given, and that advice subsequently changed... well, that's a very different story.

And even if there was evidence that a misstatement was made, the plaintiffs would have to show that it was material to the share price.

According to the Reuters story, "No securities rules and no legal precedents directly address CEO health".

It sounds like any lawyers taking on the case could have a hard time achieving a payday.