US law firm Robbins Geler Rudman and Dowd has filed a class action suit against the software giant, claiming that the company mislead investors and tried to hide the true scope of the disaster. CEO Steve Ballmer, former CFO Peter Klein, Corporate VP Frank Brod and Executive VP of Marketing Tami Reller are all named in the suit, reports Neowin.
So what exactly does the suit allege?
The firm claims Microsoft deliberately issued materially false and misleading statements regarding the company’s financial performance and the Surface RT in particular. It goes on to state that Microsoft’s financial statements for the first quarter were materially false and misleading and that company officials made misleading positive statements about the Surface RT.
Although Microsoft has a responsibility to its shareholders and it can’t just go about inventing numbers that suit it, we do have to note that a simple Google search for Surface RT painted a terrible but true picture long before Microsoft execs allegedly made the controversial statements. Surface RT was dead in the water when it launched, that was basically the consensus of the tech press months ago.
However, last the official line was somewhat different and it wasn’t until last quarter that Microsoft officially admitted the failure, by announcing a massive $900 million write-down for Surface RT stock. Shipments were dismal and even the recent 30 percent price cut can’t turn things around. As if that wasn’t enough, Microsoft and Nvidia are already working on a new Surface RT tablet and this time next year we’ll probably be reporting on how it failed.
How did it go so terribly wrong? Well, the Surface RT is a Microsoft hardware product and it’s not an Xbox. Need we say more?