Court prevents class action against IOOF
The Victorian Supreme Court has sent orders preventing plaintiff law firm, Maurice Blackburn, from proceeding with a proposed class action against IOOF in relation to media reports of failings within its research department.
It came after the law firm called for institutional and retail investors who purchased shares in the company between 1 December 2013 and 19 June 2015, to register their interest and claims last year.
However, the Victorian Supreme Court orders would prevent the law firm from "insinuating or prosecuting its proposed class action against IOOF on behalf of any person", aiding anyone else from doing so, and using or revealing confidential IOOF documents to any person.
This followed court orders made on 19 October which prohibited Maurice Blackburn's litigation funder, Harbour Litigation Funding Limited, from providing any funding or other legal support for work performed by any person in relation to the class action against IOOF.
IOOF managing director, Christopher Kelaher, said: "The court orders, which will prohibit Maurice Blackburn and its funder Harbour from pursuing the proposed class action, confirm IOOF's position. We have always maintained that the proposed class action was misconceived both factually and at law".
However, Maurice Blackburn principal, Jacob Varghese, said the case illustrated the "extreme inadequacy" of Australian law to deal with whistle blower information.
"The fact that IOOF sued Maurice Blackburn and no one else shows that this case was motivated for the sole purpose of stopping our firm from holding IOOF to account on behalf of shareholders," Varghese said.
"We still firmly believe IOOF did the wrong thing and should be held to account and that the reason it fought so hard was to avoid the scrutiny a class action would bring."
IOOF was in the spotlight last year when it faced allegations that an IOOF staff member may have been involved in insider trading when they traded in securities prior to the release of IOOF research reports relating to those securities.
But IOOF had rebuffed claims it had breached its continuous disclosure obligations or might have engaged in misleading or deceptive conduct.
However, surveillance by the Australian Securities and Investments Commission (ASIC) found no basis to the insider trading allegations, with the release of the reports having no bearing on the price of relevant securities, and did not justify a formal investigation.
AUTHOR
Malavika Santhebennur
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
