shareholders' class action

Ventracor class action on the cards

Nick Evans
Tuesday, 3 November 2009

VENTRACOR shareholders have taken the first steps towards launching their mooted class action lawsuit against the former directors of the company and its liquidators, turning over a raft of documents to solicitors for assessment.

According to a shareholder group representing the potential litigants, $10,000 has been raised by former shareholders to pay for an assessment of their case, with a decision likely this year on whether enough evidence exists for a case to go forward.

An email sent to the group this week, seen by BTN, says the group has compiled an extensive brief for its solicitors, consisting of 260 pages of documentation. There are up to eight possible complaints about the conduct of the directors and administrators contained in the brief.

While the solicitors were not named in the email and group representative Louis Salzman refused to comment on the potential suit when contacted, BTN understands the potential suit will be assessed by the group’s solicitors and then considered by a litigation funder, which would back the action on the basis it would take around 35% of any money recovered before costs.

If successful, participating shareholders would then receive a portion of whatever remains – after what would likely be a very expensive legal bill.

The $10,000 stake money has apparently been deposited with the solicitors in a trust account and will be used to defray costs associated with further investigations of the suit.

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Any comments, pacman?