As if the bad press and subsequent stock value drop HP suffered when it canceled the TouchPad tablet and put the future of webOS into question, now the company is facing a shareholder lawsuit for allegedly misleading investors. HP surprised investors in August when it cancelled its iPad competitor after only 49 days on the market and announced that its PC business — the largest in the world — might be sold or spun off.
HP hit with lawsuit over TouchPad’s demise
In the lawsuit, according to Reuters, Richard Gammel claimed HP led investors to believe it planned to continue selling and supporting webOS-based products. News that the company’s PC business was in question came as a surprise to investors and analysts, too.
Following HP’s announcement, the company’s stock dropped some 20 percent in value in a single day.
HP had hoped its webOS-based TouchPad tablet could compete with Apple’s market dominating iPad. After several months of hype, however, the tablet failed to draw consumer interest when it hit store shelves.
Mr. Gemmel’s lawsuit is asking for unspecified damages for all HP shareholders that purchased the company’s stock between November 22, 2010 and August 18, 2011 because, he argues, the stock was artificially inflated due to withheld information.
HP has not commented on the lawsuit.