Fund manager David Einhorn sues Apple, wants cash to go back to shareholders
David Einhorn is a fund manager at Greenlight Capital, and he's leading the charge with a lawsuit against Apple, claiming that the company hasn't done enough to make sure its shareholders receive the benefits of their success. Apple's been making plenty of money lately, of course, but Einhorn's problem isn't with the making, it's with what Apple is doing with that money. The company from Cupertino has built up a cash bank of nearly $100 billion, and investors have already made it clear they're not happy that Apple hasn't turned that money back into bonuses for shareholders.
"We understand that many of our fellow shareholders share our frustration with Apple's capital allocation policies," says Einhorn. "Apple has $145 per share of cash on its balance sheet. As a shareholder, this is your money," he told fellow investors. And so Einhorn has filed suit in a New York court to try and modify a proposal Apple has pending, and change the company's stance on paying off its shareholders.
We'll have to see how this plays out. Certainly Apple has a duty to its stockholders, and that is definitely a lot of money (more than any one company's ever seen before). But Apple's R&D costs are rising all the time. If Tim Cook has a good reason to have such a big cash pile, odds are it'll come out in this case.
