You could suggest that the references you are making regarding the status of the plant and "no material" issues could be similar to the Fortescue legal case where Twiggy had made an announcement of the existence of a binding contract with the Chinese that was later found to be not the case.
If the directors believed at the time of the announcement that it was the case that there were no material issues, but it was subsequently found that there were issues then they actually do not have a case to answer to. Does not sound fair, if you were able to litigate against unforeseen future events then companies would not operate as they would be in court all the time.
Maybe the directors owed a duty of care to shareholders regarding the statements being made, but misleading and deceptive (which I think is being inferred) it is not. Care should have been taken by the directors to ensure that the information they were providing was accurate, however the directors may have believed that the following statement is reasonable:
"The six month commissioning and ramp-up plan is progressing in line with expectations, with no material issues encountered. Nameplate capacity of 8 mtpa of magnetite concentrate is anticipated by the end of April 2013."
source: December 2012 quarterly report
A person that understands the industry may expect that there will be teathing problems with any plant commissioning. What is considered material when you are commissioning a major plant?
IMO, I think you would find a hard arguement to say that the directors have acted inappropriately.
GBG Price at posting:
10.2¢ Sentiment: None Disclosure: Not Held
