BlackBerry settles long-time lawsuit over BB10

BlackBerry Limited has agreed to pay $165 million to settle a class action lawsuit that alleged the company exaggerated the success of its BlackBerry 10 smartphone line.

A complaint in the U.S. District Court for the Southern District of New York was filed in October 2013. The settlement affects investors who bought shares between March 28, 2013, and September 20, 2013.

“While BlackBerry believes that the allegations in the case were without merit, it also believes that eliminating the distraction, expense and risk of continued litigation is in the best interests of the company and its shareholders,” the company said in a statement.

Reuters reported on Wednesday that the Canadian company was planning to settle the lawsuit to avoid a trial in the United States. Jury selection had been scheduled to begin today.

The company was accused by shareholders of concealing BlackBerry 10’s true sales prospects in public statements during 2013, resulting in inflated share prices.

End of era

Once a mighty player in the smartphone business – President Obama famously clung to his BlackBerry – the company was founded as Research In Motion (RIM) in 1984. It was led for years by co-CEOs Mike Lazaridis and Jim Balsillie.  

In its heyday, BlackBerry enjoyed a stranglehold of sorts as it had its own closed circle of users, similar to what Apple is doing with iPhone today, albeit on a much grander scale. But BlackBerry’s market share began to erode as Apple iOS and Google’s Android came to dominate.  

In 2016, BlackBerry decided to exit the smartphone manufacturing business and instead focus on software development and licensing.

Now, it’s focused on areas like cybersecurity. During the company’s most recent earnings call, CEO John Chen said market conditions for its cybersecurity business are positive; cyber revenue accounted for $122 million in the prior quarter, according to a transcript (PDF).

Chen joined the company in 2013 after having led Sybase.

Elsewhere, hopes for a BlackBerry-like comeback were dashed when a company called OnwardMobility went out of business.

Some diehard BlackBerry device fans were hoping OnwardMobility would produce a long-awaited replacement, but the company announced in February that it would no longer proceed with the development of an “ultra-secure” smartphone with a physical keyboard.