b'in 2018 that reportedly led to reduced consumerenvironment in China has been further impacted consumption beginning in mid-2018. Adding to Chinasby rising trade tension with the United States. This economic difficulties, the Trump Administrationeconomic deceleration accounted for most of our imposed tariffs on Chinese goods in April, July, andrevenue shortfall and over 100 percent of ourSeptember 2018. In September 2018, Apple releasedyear-over-year worldwide revenue decline. Andtwo new expensive iPhones, the iPhone XS (priced[l]ower than anticipated iPhone, primarily in Greater up to $1349) and iPhone XS Max (priced up to $1449).China, accounts for all of our revenue shortfall to out In October 2018, Apple released one slightly less[sic] guidance and for much more than our entireexpensive iPhone, the iPhone XR (priced up to $899).year-over-year revenue decline. Subsequently, At the time, analysts questioned whether these iPhonesduring a television interview, the CEO explained: [A]would sell well in the economic climate. Nevertheless,s we look at whats going on in Chinaits clear that on November 1, Apple released its revenue guidancethe economy begins to slow there for the second for 1Q 2019 at a new all-time record of $89 billion tohalf And so we saw, as the quarter went on, things $93 billion. like traffic in our retail stores, traffic in our channel Later that day, Apple hosted a conference call withpartner stores, the reports of the smartphone industry analysts and investors. An analyst then asked Applescontracting, particularly bad in NovemberI havent CEO what trajectory the CEO saw for Apples businessseen the December number yet, but I would guess in emerging markets. The CEO responded: In relationthat would not be good either. And so thats what to China specifically, I would not put China in [theweve seen. Apples stock price declined from a close category of emerging markets where we are seeingof $157.92 per share on January 2, 2019 to a close of pressure]. Our business in China was very strong last$142.19 per share the next trading day.quarter. We grew 16%, which were very happy with.Investors filed a putative class action against Apple,iPhone, in particular, was very strong double-digitits CEO, and CFO under Sections 10(b) and 20(a) of growth there. Our other products category wasthe 1934 Act and Rule 10b-5 promulgated thereunder, also stronger, in fact, a bit stronger than even thealleging that, in order to keep the price of Apples companyoverall company number.stock artificially inflated, defendants intentionally A second analyst asked the CEO about demand formisrepresented Apples iPhone sales and business in Apples new iPhones: With the staggered iPhoneChina. Defendants moved to dismiss the consolidated launch, were you able to discern any impact on theamended complaint, and the court dismissed the majority Xs and Xs Max from buyers potentially waiting for theof the allegations on the basis that the claims were based XR? And what, if anything, can we take away from theon inactionable statements and plaintiffs could not show December quarter guidance related to what yourethat defendants acted with scienter. The court, however, seeing for early demand on the XR[?] The CEOallowed the statements made on the November 1, 2018 responded The Xs and Xs Max got off to a really greatcall to proceed based, in part, on a supplemental brief start, and weve only been selling for a few weeks. Thesubmitted by separate shareholders not represented by XR, weve only got out there for, I guess, 55 days orlead counsel, which the court subsequently appointed so at this point and so that itswe have very, very littlelead plaintiff and lead counsel, respectively. The newly data there. Usually, there is some amount of wait until aappointed lead plaintiff filed a revised consolidated class product showsanother product shows up in look, butaction complaint on June 23, 2020. inthatin looking at the data, on the sales data for XsPlaintiff claimed that defendants misrepresented Apples and Xs Max, theres no obvious evidence of that in thebusiness outlook in China and demand for new iPhones data as I see it. on the November 1, 2018 conference call. First, plaintiff Four days later, a periodical reported that Applealleged that the CEOs statement that he would not cancelled its production boost for the iPhone XR,put China in th[e] category of decelerating emerging indicating a 20-25% reduction in expected sales.markets was false or misleading, in light of the CEOs later On November 12, Wells Fargo issued a report alsoadmissions that Apples China business was experiencing estimating that Apple had reduced iPhone production.pressure at the time. Second, plaintiff alleged that the On January 2, 2019, Apples CEO sent a letter toCEOs statement that [t]he [iPhone] Xs and Xs Max got off investors announcing that Apple would miss itsto a really great start was false or misleading, given that earnings guidance by up to $9 billion, representingApple canceled iPhone production lines mere days after nearly 10% of the companys guidance. The CEOthe statement was made. explained that [w]hile we anticipated some challengesDefendants again moved to dismiss plaintiffs in key emerging markers, we did not foresee theclaims, and the court granted in part and denied in magnitude of the economic declaration, particularly inpart defendants motion. First, the court held that Greater China. He continued, Chinas economy begandefendants China-related statements plausibly referred to slow in the second half of 2018, and the economicto the present considering, among other things, that the 44'