Nokia shareholders file class action lawsuit against the company over Windows Phone "fraud"

Nokia shareholders file class action lawsuit against the company over Windows Phone "fraud"
Nokia has willfully misled its investors by falsely claiming that Lumia sales could turn around the company’s position. That’s the exact accusation Nokia shareholder Robert Chmielinski used when he filed a class action lawsuit against Nokia and its highest ranking officials - CEO Stephen Elop and CFO Tomy Ihamuotila. He doesn’t claim that Nokia didn’t know about the risks associated with the Windows Phone transtion. Instead, he throws a heavy punch by saying that the company knew, but misrepresented reality to sell shareholders on the new strategy.

We already know about Nokia’s catastrophic decline in the first quarter of 2012, and Chmielinski says that the Finnish company has misled investors all until then between October 2011 and April 2012, promising an impossible turn-around forced by WP phones.

Now, that the facts are out there, it’s obvious that for Nokia’s shares that are just spiraling down and for investors, this resulted in huge losses.

Chmielinski cements his point with quotes from press releases and conference talks showing that Nokia paints a bright picture to shareholders while reality gets gloomy. Other arguments include the $100 credit for the connectivity bug in Nokia Lumia 900, which also hurt the company’s financials. He then goes on to accuse Elop and Ihamuotila to be “engaged in a scheme to deceive the market.”


We don’t know whether Chmielinski’s lawyers can actually win this, but it’s definitely a black PR spot in Nokia’s yard when the company is struggling.


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48 Comments

37. InspectorGadget80 unregistered

Getting sued by your own member that's FCKED up NOKIA. He TOLD u NOT TO GO TO Microsoft n look what happened

34. lubba

Posts: 1313; Member since: Jan 17, 2011

You f**king android fanboys need to stfu. Why concern yourself with Nokia? there's already a slew of oems making android. Isn't that enough? So what if Nokia partnered with MS. Not the end of your android or android like world! The negative s**tty fanboish attitudes just make me sick!

30. gwuhua1984

Posts: 1237; Member since: Mar 06, 2012

The share holder should of just disagreed with the partnership with Microsoft and tried to do something to stop it. Instead of letting it go through and now complaining about it when it doesn't work.

28. NateAdam8

Posts: 441; Member since: Feb 17, 2012

It's good they made WP7 devices but they should've made some Android devices cause they'd be making a lot more cash by not sticking with a slowly developing company and with the money being made they could've focused on combing Symbian with Meego to make it good enough to bring to the USA for small companys to built a reputation so more Phone Companys could see they were worth it cause more people I know are on Companys like Boost Mobile, Cricket and Straight Talk

47. NateAdam8

Posts: 441; Member since: Feb 17, 2012

All I'm say is Nokia should've built up some kind of reputation in the US on the low end market with the Symbian phones cause most people don't know about it and if they'd just taken Android into consideration it might have worked cause they need the cash now but if they could get all things Nokia on to Windows Phones that might work, And there's no need for calling people stupid cause your mad at yourself just think harder and insult less

24. steelicon

Posts: 318; Member since: Apr 02, 2011

If and when Nokia CEO Stephen Elop lied about the whole Nokia affair and all, it won’t be the first time, and it won’t be the last. If and when Tomi Ahonen lied about the whole Nokia affair and all, it won’t be the first time, and it won’t be the last. Fact #1 : Elop committed an Osborne Effect + Ratner Effect. Fact #2 : Nokia sales are on a freefall, losing more in 18 months than the last 4 years. Fact #3 : The new strategy is only gaining traction painfully slowly in a select limited market Fact #4 : All other markets are being shelved and ignored (Symbian, MeeGo, Harmattan, Meltemi) and are being force-fed with the new strategy Fact #5 : Due to the closed nature of the object of the new strategy, not all existing market base and platform agnostic but brand (Nokia) conscious segments are willing to adopt said object and are migrating to other platforms causing more loss and damages in sales. I already have my eyes on Sony Mobile Xperia ION LT28i. I’d rather migrate to that than adopt Nokia Lumia WP7.5. And I would also suggest all of my customers to do the same, should they ask for my opinion and advice. Unless Nokia could successfully copy ALL and EVERY feature of Nokia 808 PureView RM-807 in their future FLAGSHIP devices. Yes. In the Nokia Concept store, people still buy Nokia just because it is a Nokia, not because it is this or that platform. Working in a small to medium retailer/reseller company, it is my duty to know and to recommend what to push, what to sell Only time will tell, and someone, somewhere will be entitled to say to all: “I told you so.”

21. lubba

Posts: 1313; Member since: Jan 17, 2011

I hope this schmuksi loses miserably. Just a bunch of asshole lawyers looking for free money.

20. pongkie

Posts: 663; Member since: Aug 20, 2011

its like suing the lottery because he didn't win the jackpot

19. Bluesky02

Posts: 1439; Member since: Dec 05, 2011

Shareholders are promised many things, why this one is surprised? Didn't they know its Business?

16. Mobile-X-Pert

Posts: 565; Member since: Dec 20, 2010

I don't know how the ''Nokia end'' will benefit consumer. More competition is better but your fanboism doesn't let you see that.

15. 7thspaceman

Posts: 1597; Member since: Feb 14, 2011

I think all share holders of any company should have some common sense that trying something new is a Gamble. the Symbiam OS was no longer able to be good enough to compete with other OS's including Windows phone 7 series OS. The Meego OS was not ready for the market so says Elop and others in the company. The Windows 7 series smart OS is an award winning innovative OS but unfortunately it was not liked by the Public and the Microsoft Programmers had not yet configured it to use high tech smart phone components although all testers have shown it to work very well on single core CPU Mid tech components. it is bad now for Nokia to be having second thoughts because now Nokia Lumia 900's are selling like hotcakes in the USA and the Windows 8 smart phones are ready to go to market and they have all the High tech components in them to finally compete with Android or any Apple iPhone and the Windows smart phones Apps have reached 80000 and have all most of the popular APP. the board could force Elop and others in the company to make some Android smart Phones smart phones. which would be a Good move but it would take months of design work and equipment retooling before Nokia can get a single Android Ice cream sandwich class smart phone on the Market and they would still have no sure bets it would sell very given the level of competition they have to face from other Android smart phone manufacturers. it looks like Elop's days are numbered but getting Rid of him before Nokia's best the windows 8 class smart phones are on sale is bad business. Nokia should make the change when they have a good smart phone on the market place that will sell well and then make some Android smart phones to supplement their smart phones line up. the way to do it right is to have the best Windows 8 smart phones on the market and then make a good android smart phone on the market..

14. A.aoudi

Posts: 125; Member since: Feb 14, 2012

Though i am an android guy i have owned a few Nokia handsets lately. I have used Symbian belle and i think its a good platform and the real lifesaver for Nokia could be the 808 and not the Lumia series.

23. indra87

Posts: 5; Member since: May 02, 2012

True, but I'm actually interested in the Nokia Lumia series, especially the nokia Lumia 610 (beautiful hardware in my opinion) but I'll only buy one if they make bluetooth file transfer available. So, for now, I'd rather buy symbian.

27. A.aoudi

Posts: 125; Member since: Feb 14, 2012

The 701 looks good. I think the screen is the one of the brightest screens in the market and other than that it has respectable hardware.

12. FoneAddict

Posts: 263; Member since: Jul 05, 2011

The beginning of the end for Nokia.

11. bragzter

Posts: 53; Member since: Feb 21, 2012

Its surprising that Nokia was still making profits from Symbian even when Elop took over. Then he sent the "burning platform" memo. It was at that moment their share prices began falling at an alarming rate. He made them lose focus and forget about Nokia's core. Symbian was not what it use to be, yes, but the UI was its flaw. Belle has made Symbian look and feel like a brand new car. And there is MeeGo, a fresh intuitive OS that everybody loves and he wanted nothing to do with it not even if it did well. But he made sure it didn't by not launching worldwide, but instead in small, almost unknown markets. His came from Microsoft with their intentions.

13. FoneAddict

Posts: 263; Member since: Jul 05, 2011

Totally agree. I think it's clear for all to see the E-Flop effect on Nokia. It's not too late for Nokia to ditch Microsoft and switch to Android while also kick starting Meego as a possible backup plan for the longer term.

10. ron1niro

Posts: 54; Member since: Mar 28, 2012

I think i will start calling Phonearena anti-nokia or anti- microsoft. Look at the headline, "Nokia shareholders file class action lawsuit against the company over windows phone fraud" Who are the "shareholders", if i read correctly, it is just one shareholder. How many shares does he have? Obviously he hasn't invested enough in the company and it wouldn't hurt him to see the company's shares plunge more because if he had, he wouldn't make such a stupid statement seeing that the company now seems to be getting back up albeit slowly. There are many indications that the windows phone platform can work for nokia, but it is sites like this one that are trying to spread a negative hype. Come on PA, be professional.

9. Credo

Posts: 749; Member since: Apr 19, 2012

Stop making low end Symbian devices, why do you think you don't make money anymore, becouse people don't want low end device's. Go further with MeeGo and Windows Phone 8 and make all of those devices HIGH end !! Add quad cores, micro sd card support, 720p or higher screenresolutions, NFC, those polycarbonate designs and add on every device your newly pureview technology, add 1080p Full HD video recording, and most important of all, develope the Action Movie FX App for both MeeGo and Windows Phone! Let me be the BOSS and Nokia will be the top nr 1 i'm sure of that !

39. Archan_Pe

Posts: 74; Member since: Apr 08, 2012

DUDE thats nearly a stupid idea.... well put those thing in 1 or 2 nokia phones making it there flagship... but make em all? are you nuts? you know whats the point of making these low-ends? it to appeal to the people who want smartphones and still want it pocket friendly... but really symbian is just a bad idea... if they used a meego low-end.... that would appeal greatly to the not "sky-high" budgeted people.... P.S. if you were the boss of nokia and you had all those plans, LOL! it would probably in the book of world records... as the most stupid thing a company has ever done... LOL!

45. Credo

Posts: 749; Member since: Apr 19, 2012

dude thats the point, open your eyes, both MeeGo and Windows Phone are for low or high end, they are both the most user friendly OSess out there, and most important of all, they don't need thens of thousands of processors to make it run smootly, they bote work smootly with just 1 core, thats the point ! just telling you my opinion :D

48. Archan_Pe

Posts: 74; Member since: Apr 08, 2012

You didn'y get my point xD... Im agreeing with you on the "meego and windows phone" but to make them all high-end? thats pathetically insane! BTW you said "the both work smoothly with just 1 core" but in your earlier comment you said "add quad cores" xD... epic fail much?... I was commenting on the fact that your making everything high-end which is insane! I wasnt commenting on the OS... get me?

8. iamcc

Posts: 1319; Member since: Oct 07, 2011

So the dude is mad he fell for their sales pitch. Get over it...

7. -box-

Posts: 3991; Member since: Jan 04, 2012

Suing the company you're invested with isn't a great way to make stock prices magicaly go back up. Just sayin'

36. downphoenix

Posts: 3165; Member since: Jun 19, 2010

well for some its not about getting the stock price back up but just recovering some of their lost investment that has been so shamelessly squandered. Not sure how Nokia manages its board elections, but heads of Elop and others will surely roll soon unless they can get that Microsoft buyout to occur soon.

6. HugeTroller

Posts: 80; Member since: Apr 27, 2012

I love the current price of Nokia shares and I am buying more soon.

5. AndroidShiz

Posts: 154; Member since: Nov 08, 2011

It's the shareholders overall fault. The head dude used to work at Microsoft. His loyalty had nothing to do with shareholders making a profit. The two might as well be Manchurian Candidates. They should have dropped their shares as soon as they announced the exclusive partnership with a fledgling operating system. A wise CEO would've also developed Android phones, if only to save the company from spiraling. If it weren't for the forced Microsoft patents that MS uses against Android manufactures, and the special deal of "having to" make windows phones, I believe Samsung and HTC and the likes would completely abandon WP. It's never good when you have to basically force manufactures to make phones using their software, or else pay even higher fees for Android . How could you with basic common sense not get rid of your shares and invest elsewhere?

33. Whateverman

Posts: 3295; Member since: May 17, 2009

Dude, that was beautiful!

4. AhmadAlsayegh

Posts: 326; Member since: Jul 18, 2011

I think Symbian reached its maturity and it was time for Nokia to innovate or do a change in the aspect of a merger, Nokia has taken the initiative towards a new strategy, but I guess it failed to turn the tables; especially that the smart phone market has a very fast pace... First step in resolving any problem is admitting that you are in a problem, and honestly I don't see Nokia doing that, at least not the management -posted from my Samsung Focus

3. AndroidShiz

Posts: 154; Member since: Nov 08, 2011

It's just so weird. Windows phone, failing to bring them from the ashes? Who knew? Besides HTC, Samsung, LG, Sony, Huawei, and Stevie Wonder I mean.

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