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RIM prepares to defend itself against class action lawsuit, claims it misled investors

May 27, 2011 1:04 PM ETBB
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RIM (NASDAQ:RIMM)(TSE:RIM) said Friday that it plans to "vigorously" defend itself against a class action lawsuit, which claims that the BlackBerry maker misled some of its investors with regards to the company's financial condition.

The lawsuit, filed in the US District Court for the Southern District of New York, alleges that during the period from December 16, 2010 through April 28, 2011, RIM and certain of its officers made "materially false and misleading statements" regarding the company's financial condition and business prospects.

The class action case, filed on behalf of shareholders during this period, seeks unspecified damages, the Waterloo, Ontario-based smartphone maker said. RIM also said in its statement Friday that it believes the allegations are without merit.

The lawsuit comes at a time when analysts are increasingly concerned over the company's ability to remain on top of its game in the face of tough competition from Apple. RIM's PlayBook tablet generated little hype when it launched in April, compared to a craze of customers that lined up for days to purchase Apple's IPad 2.

In late April, RIM also lowered its outlook for its fiscal first quarter, due to lower than expected BlackBerry shipment volumes and a shift towards cheaper handsets.

For the three months ending May 28, it now expects earnings per share to be in the range of $1.30 to $1.37, down significantly from its previous guidance in March of between $1.47 to $1.55 per share.

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