On 15 February 2010 an agreement was reached between the parties
to the AWB class action to seek court approval to settle the claims
of the applicants and all group members for $39.5m inclusive of
interest and costs. More details will be both sent
directly to group members and posted on this web page as
soon as we can and when appropriate orders are made.
The action
Maurice Blackburn commenced a class action against AWB Limited
(AWB) in the Federal Court of Australia on 17
April 2007.
The AWB class action is being conducted by the applicants, John
and Kaye Watson, in their own right and on behalf of members of the
class. Class members are called Group
Members and are defined as persons who meet the
following three criteria:
- Between 11 March 2002 and 13 January 2006 inclusive
("Relevant Period") obtained an interest in AWB's
"B Class" securities ("AWB securities") being an
interest that was the result of a purchase of AWB securities on the
financial market ("ASX") operated by the
corporation then known as Australian Stock Exchange Limited and now
known as ASX Limited (trading as Australian Securities
Exchange);
- At the close of business on 13 January 2006 held an interest in
AWB securities obtained during the Relevant Period; and
- Suffered loss and damage by reason of AWB's Contraventions, as
defined in the Third Further Amended Statement of Claim.
The class is now closed because the Court ordered that any
person who wanted to register an interest in being a Group Member
should do so by mid 2009.
The trial of the common issues in the AWB class
action commenced on Wednesday 10 February
2010 .
AWB's alleged contraventions
The AWB class action alleges, amongst other things, that:
a) AWB breached its continuous disclosure obligations imposed
by
ASX Listing Rule 3.1 and section 674(2) of Corporations Act
2001
(Cth) by failing to inform the market that:
- between 1999 and 2003 AWB paid an Iraqi front company certain
fees that resulted in a circumvention of resolutions of the
Security Council of the United Nations;
- AWB concealed these payments from the Department of Foreign
Affairs and Trade and/or the United Nations; and
- had the payments and the true arrangements between AWB and Iraq
not been concealed, then Ministerial Permission for the export of
wheat to Iraq by AWB would not have been given.
b) If AWB's payment of kick backs to Iraq had been revealed it
would have:
- seriously damaged the commercial and corporate reputation of
AWB, its business and management;
- resulted in AWB's business with Iraq being disrupted; and
- put the Single Desk and/or AWB's management of it at risk;
so that people who commonly invest in shares would have either
not bought AWB shares or would have paid less for them.
c) AWB engaged in misleading or deceptive conduct by
making express and implied representations to the market about
the nature of its dealings with Iraq, the integrity of AWB as
a company, and about meeting its disclosure obligations.
d) As a result of AWB's non-disclosure and misleading
conduct:
- AWB shareholders bought shares when, had the truth been told,
they either:
- would not have bought them at all; or
- would have bought them at a lower price because the market
price of AWB shares was greater than it would have been had the
market been told the truth; and
- shareholders who bought and retained AWB shares during the
Relevant Period therefore suffered loss because when the truth came
out during the Cole Inquiry in 2006 the market reacted to the
revelations and the share price of AWB shares fell by over
50%.
Warning
The AWB class action, as currently framed, is not an action
against directors, stockbrokers, financial planners, accountants or
any other persons or institutions who may have been directly or
indirectly involved in the purchase by any persons of AWB
securities. If you think that you might have a claim against
any such persons or institutions, we recommend that you seek
independent legal advice, as time limitations apply.
Further information
Click
here to download the media release - AWB class action
settlement - $39.5 million
Click here to download the Third Further Amended Statement of
Claim
Click here to download the Third Further Amended Application
Click
here to download the Further Amended Defence
If you require further information about the current proceeding
please contact us on (02) 9261 1488 or by email to awbclassaction@mauriceblackburn.com.au.