A $110 million settlement approved by the Federal Court yesterday has provided a windfall for class action members who rejected a previous deal between Multiplex and ASIC.
Launched in late 2006, the class action represented 120 individual and institutional investors who lost vast sums of money after it was alleged that Multiplex breached continuous disclosure provisions of the Australian Securities Exchange between August 2004 and May 2005.
The class action claimed that Multiplex failed to inform the share market of losses incurred on the construction of Wembley Stadium in London and two other projects.
Maurice Blackburn principal Andrew Watson told Lawyers Weekly that the settlement provided vindication for investors in the class action.
"ASIC plays a critical role in the protection of investors generally... but I think yesterday's result demonstrates that the scheme of arrangement it previously negotiated between ASIC and [Multiplex] investors was greatly undervalued," he said.
Watson was one of the key lawyers involved in the case, and he claimed yesterday's settlement was up to 20 times greater than what group members would have received had they accepted a settlement negotiated between the ASIC and Multiplex in 2007.
Under the ASIC scheme of arrangement, investors would receive compensation from a pool of $32 million. Investors who accepted that offer were excluded from participating in future class actions.
The Multiplex class action was funded by Singapore-based International Litigation Funding Partners.