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BlackBerry seeks official probe of analyst report claiming high return rates


 

BlackBerry (TSX:BB) wants regulatory authorities to investigate what it says is a “false and misleading” analyst report that claims the company’s new touchscreen smartphones are being returned in unusually high numbers.

BlackBerry claims the company and its shareholders have been harmed and called for an immediate investigation by the Ontario Securities Commission and the U.S. Securities and Exchange Commission.

At issue is a report that was published by Boston-based investment firm Detwiler Fenton on Thursday which claimed a very high level of BlackBerry Z10s were being returned by customers to stores. In several cases, the returns exceeded sales, claimed analyst Jeff Johnson.

After the report was published, the volatile shares of BlackBerry took a negative turn, falling more than seven per cent on the Toronto Stock Exchange on Thursday. The company’s stock was up 18 cents to $14 late Friday morning on the TSX.

Detwiler Fenton hasn’t responded to repeated requests for comment, and executives at Blackberry are furious.

The report tarnishes what has been a relatively positive launch for the new BlackBerry touchscreen in the United States, though sales figures haven’t been made public by the company. While some analysts have expressed concern over the lack of promotional marketing, few have called it an outright failure.

“Everyone is entitled to their opinion about the merits of the many competing products in the smartphone industry, but when false statements of material fact are deliberately purveyed for the purpose of influencing the markets a red line has been crossed,” BlackBerry chief legal officer Steve Zipperstein said.

BlackBerry said Detwiler Fenton has refused a request to make its report or its methodology available even after it said the findings were “absolutely false.”

BlackBerry chief executive Thorsten Heins said sales of the BlackBerry Z10 — the first of a new generation of BlackBerry smartphone — have been meeting expectations and data collected from retailers and carriers demonstrate that customers are satisfied with their devices.

The company did not disclose any of the sales data.

“Return-rate statistics show that we are at or below our forecasts and right in line with the industry,” Heins said in a release.

“To suggest otherwise is either a gross misreading of the data or a wilful manipulation. Such a conclusion is absolutely without basis and BlackBerry will not leave it unchallenged.”

BlackBerry says the largest U.S. carrier, Verizon Wireless, has also rejected the claims by Detwiler Fenton.

Last month, BlackBerry reported that it has shipped about one million Z10 models during its fourth quarter which ended March 2 though the period did not include sales in the U.S.


 
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