AMC Stock – Nokia Corporation (NYSE:NOK), (AMC) – Nokia Can Breathe Sigh Of Relief As Lawsuit Over Defrauding Shareholders Dismissed
A lawsuit against Nokia Oyj (NYSE: NOK) alleging that the telecom company defrauded shareholders was dismissed in New York on Monday, Reuters reports.
What Happened: The Finnish company was accused of concealing troubles related to the integration of Alcatel-Lucent as well as its preparedness in emerging as a leader in the 5G space.
United States District Judge Andrew Carter in Manhattan reportedly said the plaintiff in the case, Clyde Waite, failed to show that Nokia’s statements made at the time were false or misleading.
The judge pointed to the “numerous and continuous disclosures [by Nokia] regarding the Alcatel integration and 5G progress.”
In March 2019, Nokia had informed regulators regarding “compliance issues” at Alcatel-Lucent, a company that it purchased in 2016 for EUR 15.6 billion ($18.36 billion). The lawsuit against Nokia was filed soon after the disclosure.
In October 2019, Nokia lowered its profit outlook and suspend dividends saying it needed to spend more money due to increased competition in garnering a 5G market share.
The March disclosure led to a 6% fall in Nokia shares, while the October one made the shares slip 24%.
Why It Matters: The lawsuit was dismissed with prejudice and cannot be filed again, noted Reuters.
Nokia shares have risen 31.8% on a net basis over one year and 2.8% since 2021 began. The shares were in the crosshairs of Reddit investors, who also carried out a short squeeze in stocks of GameStop Corporation ((NYSE: GM)E), BlackBerry Ltd (NYSE: BB), and AMC Entertainment Holdings Inc (NYSE: AMC).
This month, Nokia announced a five-year partnership with AT&T Inc (NYSE: T) related to its 5G technology, which will be deployed to customers across parts of the U.S.
The nordic company said it is looking to slash 10,000 jobs over the next two years to better its growth and margin prospects.
price Action: Nokia shares closed nearly 1% lower at $4.02 on Monday and fell 0.25% in the after-hours trading.
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