I just read an article on Forbes.com Lawsuits Could Fly Over Jobs’ Exit. The article discusses the potential laws aimed at Apple if there is a significant drop in Apple stock resulting from Jobs taking a leave of absence. Reading the article I was struck with a number of thoughts. Do the stock holders have the right to sue because the CEO is having health issues? What is the real reason for the price drop? What are the broader implications if there are lawsuits?
I won’t pretend to have the answers to these questions, but here are some of my initial thoughts. I think most of us will agree that Steve Jobs is a charismatic figure that is the face of the company. Now is he the only one that is driving the company? It’s also true that many companies fail after the CEO or leading figure leaves. Does Apple have what it takes as a company without Jobs? There is a potential lack of confidence in the company without him, which could lead to the drop.
Robert M. Daines makes a good point, “From the defense bar’s point of view, there’s a suit every time there’s a stock drop, basically.” In the US we sue for everything. Anytime someone thinks they are owed something… they sue someone. CEO gets sick. Confidence in company drops. Stockholders lose money. Someone must be to blame, right? Well, let’s sue the company. Do the shareholders have a right to sue? Did the company act inappropriately when disclosing CEO’s state of health? I’m sure there is a lawyer out there that would say yes if they think they can get money out of it. The expression “kick them when they are down,” comes to mind.
