Ann: Commencement of Federal Court Hearing, page-13

check out this article from AFR! Last paragraph shows what they are aiming to achieve which has nothing to do with penalty to Nuix the business, just the listed directors on the company.


Disappointing Nuix kept quiet after $1.8b floatJessica SierJournalistNov 20, 2023 – 7.06pmSaveShareTroubled tech stock Nuix should have revealed it would miss its financial targets to investors who bought shares in the software company when it floated, lawyers for the Australian Securities and Investments Commission have told a court.Opening submissions for the four-week trial began on Monday, with ASIC lawyers referencing emails sent between Nuix executives and board directors that suggest there were discussions about how to publicly address the lagging revenue growth.Nuix chairman Jeff Bleich is one of the defendants in the Nuix trial. “They had recognised that until then, the message had been one of growth, but the problem had arisen that the results they had were inconsistent with that growth,” Jeremy Giles, barrister for ASIC, said.ASIC has been pursuing Nuix since a joint investigation by The Australian Financial Review, The Sydney Morning Herald and The Age revealed s in erious culture and governance issues as well as a history of missed sales forecasts.ASIC alleges the Nuix board published ASX announcements – made on February 26, 2021 and March 8, 2021 – that informed investors the company would hit the statutory and annualised contract value numbers, or ACV, forecast in the company’s prospectus.But estimates for the first half of FY21 were $17.1 million or 9.6 per cent less than the financial figures used to develop the prospectus before the $1.8 billion float, Mr Giles told Justice Scott Goodman.By April, revenue forecasts were also down to either $185 million or in the range of $180 million to $185 million, the court heard.ASIC’s lawyers said Nuix and its directors allegedly breached the law from January 18, 2021 until April 21 that year by failing to disclose the failure to hit these targets and the reasons behind the underperformance.The directors involved in the case are Jeffrey Bleich, Nuix’s current chairman, Rodney Vawdrey, Susan Thomas, Daniel Phillips and Sir Iain Lobban.Mr Giles said Nuix could have issued corrective notices on the Australian Securities Exchange or entered into a trading halt while it examined its forecasts to determine whether they were accurate.The sharp movements in the Nuix share price indicated how material the disclosure was to retail investors, Mr Giles said. ASIC’s lawsuit does not take issue about the prospectus itself.Nuix, which will present its opening submissions later this week, has said the information was immaterial to retail investors.ASIC has been examining Nuix since the “biggest IPO of 2020” burst, wiping billions of dollars of market value from investors who were sold the idea of a fast-growing technology company when in reality it was a much slower, enterprise software business.The regulator has previously dropped an investigation into whether the IPO prospectus and financial statements between June 2018 and June 2020 were misleading.It has also dropped its investigation into Macquarie Capital and whether the bank contravened the Corporations Act regarding the Nuix IPO.ASIC is seeking court-ordered penalties and orders disqualifying the former Nuix directors from managing corporations. The trial continues.