AMSTERDAM
The Dutch shareholders association VEB is threatening to take Philips to court over how it handled a global recall of respiratory machines. According to a letter sent to the company on Monday by the VEB, the company lost billions of dollars because it gave shareholders wrong information.
Philips said that it had gotten a letter from the VEB on Sunday night, but it didn’t say what it said.
Philips spokesman Steve Klink said, “We are sure that Philips did the right and responsible thing.” He also said that the company was sure it could talk to the VEB and solve the problems.
In June of last year, Philips shocked investors by recalling millions of breathing machines used to treat sleep apnea because the foam inside the machines could break down and become toxic.
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In the 15 months since the recall was announced, the market value of Philips has dropped by about 27 billion euros ($27.23 billion) because investors are worried about big legal bills.
In a letter that FD reported on, the VEB said that Philips was to blame for about 16 billion euros of these losses because it gave false information about the machines that were affected.
It said that reports from the U.S. Food and Drug Administration showed that people in the company knew about the problems years before users were told.
FD said that the shareholders association plans to file a damage claim and has asked to meet with Philips before the end of the month.
($1 = 0.9917 euros)