Dutch investors request court investigation into Philips sleep apnea scandal

The Dutch Investors’ Association (VEB) will ask Amsterdam’s corporate chamber to launch a thorough investigation into Philips’ sleep apnea scandal, in which foam from the company’s ventilators posed health risks. The recall of millions of devices has caused major financial losses for the company and affected shareholders, amid accusations that Philips concealed the safety risks for years.

The investors’ group is demanding transparency regarding the “facts and circumstances that caused misleading and untimely disclosures.” According to the VEB, “Philips’ inadequate information management has produced misleading annual reports, press releases, and other public communications. This unacceptable situation will persist until Philips clarifies the matter.”

The investor group also stated that it is still unclear how the internal checks at Philips were able to fail so disastrously. According to VEB, the board had insufficient oversight on its subsidiaries, and the company’s supervisory board fell short in fulfilling its oversight responsibilities.

“Finding out the truth is an essential step in solving the dispute that Philips has with the investors. The investors’ trust has been severely damaged. Everyone involved would benefit from the errors being out in the open, lessons being learned, and responsibility being taken. Only by doing so can the sleep apnea case be fully resolved and investor confidence rebuilt,” the VEB stated.

“This is merely a request from the VEB, not a ruling by the court. The corporate chamber still has to assess whether the request is justified. It could therefore also be rejected. We do not agree with the positions taken by the VEB in the press release, and Philips will defend itself,” the company said in a statement.