Intel investor sues over Foundry flop, seeks to reforge corporate governance

Intel executives have been hit by a shareholder derivative lawsuit from an investor alleging that they and others were misled regarding the financial performance of the company's foundry business. The complaint, (1:24-cv-00734) brought by Stourbridge Investments, alleges that Intel's management made "materially false and …

[Neil Barnes]

caused Intel's stock price to fall by $3.23

Did they not read the bit about 'stocks may fall as well as rise. Your house is at risk...'?

[Michael Strorm]

Re: caused Intel's stock price to fall by $3.23

Devil's advocate, but what the article claims they actually allege is that "Intel's management made "materially false and misleading statements" relating to the success of its foundry business".

I don't know enough to tell whether that claim- and the entire legitimacy of the legal complaint it underpins- is legitimate or not.

But assuming it is then it sounds like they're saying that Intel- or rather its management- *knowingly* made misleading statements about something they *already* knew not to be true at the time.

That being the case, if they then bought shares at a price that was higher than it would otherwise have been- as a result of those misleadingly-positive statements- and later saw the share price fall (to what it otherwise should have been in the first place) when the truth was revealed, they could still reasonably claim to have lost money as the result of the false statements put out by the Intel execs.

That would be significantly different to the case I suspect many here are imagining, where the fall in share price was due to a business investment or plan that simply hadn't worked out.

[Michael Strorm]

And the man in the vest said everyone invest..

...but it turned into a foundry flop.

And Stourbridge at the back said shareholders should attack

and it turned into a boardroom blitz.

Boardroom blitz!

[Pascal Monett]

Okay, you might have been mislead

But what "financial damage" are you complaining about ?

That you couldn't sell your shares as high as you were expecting ?

That's the game you decided to play. You're an investment company, you're supposed to know the rules.

If I had money to invest, I know who I wouldn't be trusting with it now.

[Michael Strorm]

Re: Okay, you might have been mislead

I commented in more detail above, but Stourbridge's allegation is that Intel execs "made "materially false and misleading statements" relating to the success of its foundry business"- i.e. knowingly misrepresented the state of the business and lied about something they *already* knew to be untrue.

Presumably, they bought the shares at a price inflated by that, then when the truth came out, it fell to what it would otherwise have been (if not lower).

[caleb.allen]

Seems like the whole purpose of this reorg is to put pressure on the Foundry side to get their asses into gear toward profitability... what's the problem here? It's a great move by Intel's management. Besides, the bottom line is still the same!

[JRStern]

The least of Intel's reporting problems

I'd say Intel has under-reported significant issues for going on ten years now, to the point that a lawsuit could easily succeed.

But just complaining about the foundry issue, I dunno.