HP sued for lying to investors

Shareholders are suing HP for not warning them that they were planning to dump WebOS and spin off its hardware business.

According to Reuters a shareholder has launched a class-action claiming that HP and top executives misled investors for months before telling anyone that it was going to kill off the TouchPad or turn into a software company.

The move hammered HP’s shares and Richard Gammel wants his money back.

He said that the maker of expensive printer ink lied about the fact that its existing business model was not working and that webOS was no longer central to its business model.

Shares of the company plunged 20 percent after the outfit announced its plans, marking its biggest single-day drop since the Black Monday stock market collapse of 1987.

The class-action filed this week in a U.S. District Court by Robbins Geller Rudman & Down accuses HP executives, including CEO Leo ‘Action Man’ Apotheker and CFO Cathie Lesjak of misleading investors by making positive statements about the company’s performance.

It wants to recover unspecified damages on behalf of anyone who bought into HP between November 22, 2010, and August 18 of this year. Gammel argues that the lack of disclosure about potential problems means its shares were artificially inflated.