Apple 1997 Annual Report Download - page 57

DEREK PRITCHARD V. MICHAEL SPINDLER ET AL.
In March 1996, a purported shareholder class action was filed in the California Superior Court for Santa Clara County naming certain current
and former directors of the Company as defendants. The complaint sought damages and alleged that the defendants breached their fiduciary
duty by allegedly rejecting an offer from a computer company (not named in the complaint) to acquire the Company at a price in excess of $50
per share. In August 1996, the Court sustained defendants' demurrer and dismissed the complaint on a variety of grounds, and granted plaintiff
leave to amend the complaint. In October 1996, the plaintiff filed his first amended complaint in which he asserted the same purported cause of
action as the original complaint, alleged additional facts purportedly in support thereof, and added the Company as a defendant. In March 1997,
the Court sustained defendants' demurrer without leave to amend.
LS MEN'S CLOTHING DEFINED BENEFIT PENSION FUND V. MICHAEL SPINDLER ET AL.
In May 1996, an action was filed in the California Superior Court for Alameda County naming as defendants the Company and certain of its
current and former officers and directors. The complaint seeks compensatory and punitive damages and generally alleges that the defendants
misrepresented or omitted material facts about the Company's operations and financial results, which plaintiff contends artificially inflated the
price of the Company's stock. The case was transferred to the California Superior Court for Santa Clara County. In July 1997, the Court
sustained the Company's demurrer dismissing the amended complaint with leave to amend, after which plaintiff served a second amended
complaint. In September 1997, the Company and the two remaining individual defendants (former directors Markkula and Spindler) brought a
motion to dismiss the second amended complaint. In October 1997, the Court granted the motion to dismiss in its entirety with leave to amend
as to certain defendants and claims. In November 1997, the plaintiff filed a third amended complaint, adding a former director as a defendant
and alleging further misrepresentations by the defendants about the Company's operations and financial results.
"REPETITIVE STRESS INJURY" LITIGATION
The Company is named in approximately 60 lawsuits, alleging that plaintiffs incurred so-called "repetitive stress" injuries to their upper
extremities as a result of using keyboards and/or mouse input devices sold by the Company. These actions are similar to those filed against
other major suppliers of personal computers. In October 1996, the Company prevailed in the first full trial to go to verdict against the
Company. Since then, approximately ten lawsuits have been dismissed with prejudice by the plaintiffs, and two others have been dismissed by
court order. The remaining actions are in various stages of pretrial activity. Ultimate resolution of these cases may depend on industry-wide
progress in resolving similar litigation, as well as on resolution of major questions of law currently before the state appellate court in New
York, where a majority of the cases were filed.
MONITOR-SIZE LITIGATION
In August 1995, the Company was named, along with 41 other entities, including computer manufacturers and computer monitor vendors, in a
putative nationwide class action filed in the California Superior Court for Orange County, styled Keith Long et al. v. AAmazing Technologies
Corp. et al. The complaint alleges that each of the defendants engaged in false or misleading advertising with respect to the size of computer
monitor screens. Also in August 1995, the Company was named as the sole defendant in a purported class action alleging similar claims filed in
the New Jersey Superior Court for Camden County, entitled Mahendri Shah v. Apple Computer, Inc. Subsequently, in November 1995, the
Company, along with 26 other entities, was named in a purported class action alleging similar claims filed in the New Jersey Superior Court for
Essex County, entitled Maizes & Maizes v. Apple Computer, Inc. et al. Similar putative class actions have been filed in other California
counties in which the Company was not named as a
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