Crown Resorts class action
Crown Resorts Ltd (CWN) shareholders can now register online to recover money lost after the listed company’s share price slumped on the back of revelations late last year that several Crown employees were detained in China on suspicion of engaging in illegal marketing of its gambling services.
Crown shares fell nearly 14 per cent in a day, on 17 October 2016, following confirmations of the detention of Crown staff in China, reportedly for activities designed to court the high-end VIP market.
The significance of the detentions and later arrests is their impact on CWN’s future revenue from VIP gaming, in particular due to an expected decline in VIP patronage at CWN’s casinos.
There is a compelling set of events suggesting that the company knew or should have known of the risks the Chinese environment posed to the company’s revenue streams, and therefore shareholders should have been apprised of those risks which should have been factored in to the share price.
Given the market reaction to the news once it became public was severe with Crown shares falling almost 14% on a trading volume of over 10 million – almost 10 times the three month average – in a single day, that information clearly was material to the share price and should have been disclosed earlier.
That ultimately means investors paid an inflated price for those shares, and it is that inflation that this potential class action will seek to recover on behalf of aggrieved shareholders.
Shareholders that want to recover compensation as a result of unfairly paying an inflated price for their Crown shares between 6 February 2015 and 16 October 2016 can now register their details cost and risk free.
Institutional investors wanting a funding pack can request one by emailing email@example.com
The arrests in China occurred against the backdrop of Crown’s massive investment in its Sydney venture at Barangaroo, which has been spruiked as opening as a ‘VIP only’ casino and luxury resort in 2021.