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Judge believes Greenlight Capital has a strong case against Apple
Earlier this month, David Einhorn of hedge fund Greenlight Capital and Apple shareholders brought a lawsuit against Apple seeking to force the company to share more of its massive cash reserves with shareholders, and claiming that it had violated SEC rules in a proposed amendent to its corporate charter. Yesterday in New York, US District Judge Richard Sullivan, who's hearing the case, said that the "likelihood of success is in favor for Greenlight on the merits," according to a report by Fortune. Einhorn is seeking to block a vote on the proposition that Apple intends to conduct during its next shareholder meeting on February 27. Judge Sullivan stated that he wasn't entirely convinced that Greenlight would suffer "irreparable harm" if the vote goes through, and is inclined to let it happen since the results could be undone if he later finds that Apple violated SEC rules. Einhorn actually supports two of the three items in the proposition, but strongly opposes the third, which would let Apple issue preferred shares without a shareholder vote. Judge Sullivan said that he will issue a ruling on Einhorn's request to block the shareholders from voting before they gather next Wednesday. It's seeming likely that Sullivan -- who called the situation "a mess" -- will simply wait to see what the shareholders decide before taking further action. For his part, Apple CEO Tim Cook is calling the hole thing a "silly sideshow."
WSJ: Apple will respond to Greenlight Capital lawsuit by Wednesday
The pace is picking up in the lawsuit filed against Apple by Greenlight Capital fund manager David Einhorn. The Wall Street Journal reports that 1 Infinite Loop will issue its response to the suit by this Wednesday, February 13, with Greenlight expected to follow up with its comments by Friday in the US Court for the Southern District of New York. George Riley of O'Melveny & Myers, a longtime Apple attorney and close friend of Steve Jobs, will be arguing the case. Apple is eager to address the suit quickly, before its scheduled shareholder meeting on February 27. The suit is likely to be a top topic during the meeting, as it concerns the belief of Einhorn and other shareholders that Apple should share more of its earnings -- particularly a more than $100 billion cash stockpile -- with investors. We'll have more on the story after Apple files its response in court.
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.
Yahoo starts selling half of its Alibaba stake as promised, sends $3.65 billion to giddy shareholders
Anyone who's been holding on to Yahoo shares through thick and thin is about to reap the rewards of that patience. As the company promised, it's starting to sell back half its stake in Alibaba, closing the first stage of the deal with the equivalent of $7.6 billion in pure revenue. The struggling search and content firm 'only' pockets a net $4.3 billion after taxes and other overhead costs, but it won't even see that much in its bank account: it's purposefully sending $3.65 billion of that money to shareholders, both to inspire new confidence and (unofficially) to head off activist investors like Dan Loeb that might otherwise want a coup d'état. If share owners plan on using the second stage of the sale to fund a vacation to Maui, though, they'll need to wait. Yahoo's deal prevents it from selling half of its remaining 23 percent stake unless Alibaba files for an initial public offering, and there's no guarantee that investors will see another dime of the proceeds.
Best Buy founder ever closer to finalizing company buyout bid
Best Buy founder Richard Schulze may have stepped down as chairman of the board, but he's certainly not out. His plan to buy the turbulent company has reached the next step -- an agreement which pre-empts the formal offer. Schulze now has access to all the private numbers he'll need to put together an investor group within the 60-day timeframe. And, if this round is unsuccessful, it'll be next January before another bid can go to the Board of Directors, followed by direct shareholder offers if the second attempt fails. Given that Schulze owns 20 percent of Best Buy, he gets two seats-worth of voting power as long as he sticks to the agreed process. So, with a new CEO taking the reigns in September and the acquisition machinery in top gear, is there fresh hope for the big box retailer?
Frogster changes name to Gameforge Berlin AG
After two years of working together in harmony under the separate names Frogster and Gameforge, Frogster's shareholders decided to fully integrate the two and ditch the Frogster name. Not only will this affect the German company's European subsidiaries, but it will also change the Frogster America and Frogster Pacific GmbH names to Gameforge America Inc. and Gameforge Pacific GmbH, respectively. There's no word of any staff changes or (further) game shutdowns associated with this name change, and the company's CEO, Seth Iorio, commented the company now has "the combined experience and expertise of around 600 employees in all locations available and can thus offer [its] players even better service." [Source: Gameforge press release]
Nexon pays $685 million for 14.7 percent of NCsoft
Nexon is now a minority shareholder in MMO publisher NCsoft, having purchased 3.218 million shares of the company from NCsoft chairman/cofounder Taek Jin Kim to the tune of ₩804.5 billion ($685.43 millon) – 14.7 percent of total stock. This makes Nexon the largest shareholder in NCsoft, according to VentureBeat.The purchase is part of a two-year agreement between the two South Korean game companies, though the specifics of said agreement remain shrouded in mystery. This announcement comes somewhat cooly on the heels of reports that claimed Nexon had designs to take over EA; reports that ended up being far less interesting than originally thought. Update: Nexon has informed us that the deal was a "one-time purchase" and that they "have not made any announcements about any future plans."
Facebook CEO Mark Zuckerberg says mobile apps the top focus, we say it's about time
Facebook has been making a lot of promises during a tour to drum up interest in its ever-nearing IPO, but the one gadget-heads have been wanting to hear the most, a commitment to its mobile apps, has been elusive -- until now. Everyone's favorite hooded CEO, Mark Zuckerberg, is telling investors in his home 'burg of the San Francisco Bay that mobile is front and center in his company's plans. We're hoping that means new app features, although Zuck is likely referring to money-making as well: shareholders are jittery knowing that Facebook makes most of its money on web ads that it's not running on smartphones and tablets. Paid titles in App Center will go a long way towards scratching that itch, mind you. As for us, we'll just be happy if Facebook takes less than a year and a half to produce a major tablet app.
AT&T stockholders vote down net neutrality proposal
AT&T stockholders took to the ballot box today at their annual meeting and voted not only to reelect the entire board of directors, but also on a number of measures concerning how the company should conduct business. Chief amongst them was a provision that would have required the carrier to operate its network according to the tenets of net neutrality. Unfortunately for you (unless you're an AT&T exec), the proposal was voted down by a pretty stunning margin. 94.1 percent of shareholders opposed, with only 5.9 casting their voice in favor of true network neutrality. For more info check out the PR after the break.
Kaz Hirai reveals 'One Sony' turnaround strategy, will cut 10,000 jobs
Freshly minted Sony CEO Kaz Hirai has revealed his plan to turn around Sony's fortunes and as rumored, it includes significant cuts. Two days ago, the company revised its projections for the 2011 fiscal year to reflect a $6.4 billion loss. The One Sony plan includes reducing headcount by 10,000 in the 2012 financial year, a number that also reflects jobs leaving Sony as businesses are sold or otherwise reorganized, and will cost it 75 billion yen ($926 million) during 2012. Currently, the plan is to focus on digital imaging, gaming and mobile for growth, until those three make up 70 percent of its total sales in 2014. As far as its beleaguered HDTV business, it's going forward with the plans announced during CES to streamline the product line, reduce its costs, and return to profitability by 2014. Looking forward, there's slightly fuzzier promises to "develop and commercialize" OLED and Crystal LED technology. Beyond those the idea is to expand in emerging markets, as well as medical and 4K related technologies. There's more details in the press release after the break and presentation slides linked below, we'll let you know if there's any more information revealed on a conference call later on today.
Sony CEO Kaz Hirai to reveal new strategy on April 12th
If you want to pick up some tips before appearing on The Apprentice, or perhaps you're just want to know how Sony plans to wriggle back from a predicted $2.7 billion loss this fiscal year (its fourth concurrent in the red) then cancel all your plans for April 12th. Sony Corp will be holding a briefing on that date to share its rescue strategy plan with the shareholders, and the world. In attendance, of course, will be the newly minted CEO Kazuo Hirai, who'll no doubt be taking the opportunity to assert his position for the first time. Details of the call are in the source, just resist the temptation to scream "You're Fired."
Protesters aimed to deliver new letter to Apple during shareholders meeting
Protestors delivered letters to Apple Stores around the world asking Apple to re-examine its use of Foxconn production factories overseas. Apple decided (relatedly or otherwise) to step up its inspections of those factories, so you probably won't be surprised to hear that protestors planned to do it all again. SumOfUs aimed to deliver a letter to Apple during its recent shareholder meeting, allegedly written by two factory workers who claim they were poisoned while working on the line. The protest and the meeting were both held the morning of February 23, so hopefully the handoff went off without a hitch. Apple hasn't officially acknowledged these protests, and I'm sure it would rather not have these kinds of claims bouncing around in public. Still, Apple hasn't been closed off to the issue; the company often runs inspections on overseas factories and has consistently said that every facility where its products are built adheres to all standard regulations. So far, all these protestors have asked for is to "reform working conditions," but exactly what that means, or what form of action that might mean for Apple, is unclear. As long as these protestors remain civil and Apple continues to hear their concerns and act on them as best it can, hopefully everyone will do what's right for any workers dealing with unfair or possibly harmful conditions at these plants.
'Staunchly British' Jagex sets the record straight about its new ownership
Jagex doesn't take kindly to being called an American company these days, it appears. In an interview with GamesIndustry.biz, CEO Mark Gerhard set the record straight about the recently reported deal that put the British game studio under the purview of an American investment firm. Because the deal was made earlier last year, Gerhard sees this as old news and stressed that the company was trucking on much the same as it ever was. "The insinuation that this is a company that somehow now is run by bankers in the US again couldn't be further from the truth," he said. "Sure we therefore have some American shareholders, but the management and the culture and the ethos and everything else is the same people, in the same hands, and staunchly British." He also clarified why the studio's profits were reported to be down: "If you look at our company's house filings, revenues are up but profits are down, and those aren't because we're doing a crap job, that's because we're consciously taking those profits and ploughing them back into the business." Gerhard said that the company was "very, very selective" when it came to investors, and that it feels completely comfortable with the current board of directors. He said that the new investors were not interfering with the day-to-day development and operations of Jagex's ever-expanding library of titles: "I'm very excited for the year ahead and everyone in the studio is very focused on, not just making RuneScape and 8Realms a financial success, but our work on Stellar Dawn and even Transformers coming together to make truly great games for this year."
Dell speaks out on infamous Apple quote
Dell CEO Michael Dell spoke at the Web 2.0 Summit, and he discussed his infamous quote regarding Apple. Back in 1997, Dell famously said that if he were put in charge of Apple, "I'd shut it down and give the money back to the shareholders." Nowadays, given all of Apple's success, it's easy to laugh at Dell's thinking. But Dell today says the quote "was misconstrued." In fact, he says, he was asked the same question a few times, and when he finally answered, it was from his point of view not as a potential Apple CEO, but as the head of Dell, which is where he says he belongs. "The meaning of my answer was that I'm the CEO of Dell, I don't think about being the CEO of any other company, I'm not a CEO for hire, so if you asked me what I'd do for any other company, it's not really something I think about," he says today. Dell in fact says he has great respect for both Steve Jobs and Apple. "Obviously Steve will be missed and was a friend." Well, OK then. That makes Mr. Dell sound pretty reasonable, actually. Of course, even if he was CEO of Dell and Apple, he'd still have been smart to keep the company going (and no matter what he says, Apple fans will probably always use his quote as an example of why you should never vote against this company), but sure, thinking of himself as head of Dell always, he'd have good reason to go ahead and shut the company from Cupertino down.
Engadget Podcast 255 - 09.09.2011
As a lover of all things nostalgic and good, you'll certainly appreciate the dulcet tones of Peter Rojas, Engadget founder, major proponent of All Things Good With Tech, and the original voice of the Engadget Podcast, on this edition of the Engadget Podcast. There's a lot of thought work to be done on the week's news, fraught with patent kerfuffles, Android editions, and listener questions, and we do believe we've done the heavy lifting -- with Peter's help. Come join us.Host: Tim Stevens, Brian HeaterGuest: Peter RojasProducer: Trent WolbeMusic: There Is A Light That Never Goes Out01:30 - Droid Bionic review10:00 - Droid Bionic arrives at Verizon tomorrow, we go hands-on today (video)20:00 - Motorola Droid Bionic finally available on Verizon, angels sing in chorus41:08 - Is this Nintendo's 3DS joystick add-on?47:35 - Shareholder calls for RIM to sell itself or its patents, in critical open letter51:25 - HTC sues Apple with help from formerly Google-owned patents55:25 - Eric Schmidt: Ice Cream Sandwich coming in October or November57:51 - Listener questionsHear the podcastSubscribe to the podcast[iTunes] Subscribe to the Podcast directly in iTunes (enhanced AAC).[RSS MP3] Add the Engadget Podcast feed (in MP3) to your RSS aggregator and have the show delivered automatically.[RSS AAC] Add the Engadget Podcast feed (in enhanced AAC) to your RSS aggregator.[Zune] Subscribe to the Podcast directly in the Zune MarketplaceDownload the podcastLISTEN (MP3)LISTEN (AAC)Contact the podcastSend your questions to @tim_stevens.Leave us a voicemail: (423) 438-3005 (GADGET-3005)E-mail us: podcast at engadget dot comTwitter: @tim_stevens, @bheater, @peterrojas
RIM aims to launch seven smartphones with BlackBerry OS 7 in 'the coming months'
It may look like it's losing the ongoing smartphone war, but Research in Motion is at least preparing for the next battle with reinforcements. Co-CEOs Jim Balsillie and Mike Lazaridis announced at this week's annual shareholder meeting that seven new OS 7-powered BlackBerry smartphones are set to be launched in the near future. As the company struggles to meet its financial goals due to delays, it's confident that releasing a large number of smartphones will make up for a miserable Q1 and get RIM back on track by the end of the year. This seems to be a bitter contrast to earlier rumors suggesting the company scrapped other projects to make room for its QNX "superphone." No word was given by either executive as to which phones we can expect, nor the precise dates when these devices will become available. We also haven't heard if the Bold Touch series is included as part of that count since its launch looks to have been pushed back. Lazaridis mentioned the delays are a result of his company trying to meet (read: not exceed) consumer expectations, and that RIM will "come out ahead" in the smartphone race. Now that's extraordinary confidence; unless the execs had a heart-to-heart with the anonymous letter-writer, however, it's a hard pill to swallow. [Image courtesy of CrackBerry]
AAPL's top owners have cashed in some stock recently
Fortune's Apple 2.0 blog has an interesting tidbit about Apple's stock lately. A blogger who calls himself Sammy the Walrus IV has been poking around into AAPL records, and has found out that several of Apple's top shareholders have sold some of the stock recently. There's nothing shocking here (nothing outside of the usual buy and sell on the stock exchange), but the numbers are interesting, with firms like Janus Capital and Capital Research investing back into AAPL for over a billion dollars each. Four of the top 10 holders of Apple shares have sold off some this past quarter, including Goldman Sachs, who got rid of 61% of its shares, and these same top 10 holders basically determine the fate of AAPL, as they own around 25% of the company as a whole. Again, these are all routine sales, and as you can see from the chart above, there's still plenty of AAPL buying going on (and we'll even state the obvious: this post should not be considered financial advice). But it's an interesting overview of some of the core firms and shareholders behind the movements of AAPL lately.
Ron Sugar wins board member popularity contest
OK, weekend pop quiz! Quick, who's the most popular member of the Apple board with shareholders? Head-scratching allowed, coffee may be taken, think hard, no taking peeks at the illustration or headline here...Well, if you answered 'Steve Jobs', you're probably human. And if you're an anonymous financial institution you answered 'Ronald Sugar.' Since anonymous financial institutions outweigh humans more than two-to-one when it comes to owning Apple shares, the most popular Apple director is, as reported by Fortune's Apple 2.0, Ronald Sugar. The former CEO of aerospace company Northrop Grumman joined Apple in November to replace Jerry York, who died last March and Google's Eric Schmidt, who left in 2009. As you can see from the table taken from the SEC form 8-K filed last Thursday, Steve Jobs was re-elected to the board of Apple with nearly 3.5 million votes less than were cast for Ronald Sugar -- and that, as before, Andrea Jung was the least popular board member. We probably shouldn't read too much into the voting -- 70% of Apple shares are held by financial institutions, and 4.8 million votes were cast against re-electing Steve Jobs to the board at all. chart courtesy of Apple 2.0/Fortune
Viacom denies keeping payments from Harmonix
Viacom has responded to claims this morning from Harmonix shareholders that the company avoided paying out bonuses to the developers of the Rock Band series. Viacom of course denies it dodged any obligations, and says instead that the representative for Harmonix's shareholders, Walter Winshall, was offered agreements that included big payouts for the developer but "spurned" those, hoping for a bigger reward later. That reward never came, says Viacom, and Winchell is allegedly lashing out with this lawsuit for not meeting his shareholders' expectations. That doesn't quite cover the other allegation in the lawsuit against Viacom, which claims that it set up an agreement with EA on the Rock Band brand that benefited its own interests rather than those of Harmonix (by doing things like trading advertising sales on MTV rather than passing on profits to the developers). Proof on that allegation, one way or the other, will have to come out in court -- if this lawsuit goes that far.
Michael Dell given an unsubtle hint by displeased shareholders
It's looking very much like that SEC investigation into Dell and Intel's overly intimate relationship has aggrieved investors in the former company. In a recent shareholder vote on the subject of Michael Dell's continued presence on his eponymous company's board, an almost unprecedented 25 percent expressed their desire that he leaves. We can't say we blame them, considering Michael had to spend $4 million of his own cash to square things with the SEC. He never admitted any personal guilt for the company's misreported earnings, but then innocent people don't tend to pay multimillion-dollar personal fines either. As it stands, he still has the backing of the majority of investors, but Mike might still do best to hand over the CEO reins to someone who hasn't been dragged through the mud of impropriety quite so thoroughly. We hear Mark Hurd might be on the market soon.
