Slater & Gordon this week (24 August) filed a class action in the Supreme Court of New South Wales against mineral resources company OZ Minerals, on behalf of "mum and dad" investors.
The investors are claiming that OZ Minerals failed to disclose the full extent of its debt and its refinancing difficulties as it struggled to stay afloat in 2008.
More than 140 retail investors have come forward claiming to have lost a portion of $18 million when the OZ Minerals share price fell by 80 per cent and was suspended at 55 cents in November 2008.
Investors are alleging that OZ Minerals engaged in misleading or deceptive conduct and breached its continuous disclosure obligations by understating its liabilities by approximately $300 million and by failing to inform the market of its refinance risk and its risk of insolvency.
Slater & Gordon commercial litigation lawyer Van Moulis said he had been approached by investors who were concerned they had not been kept fully informed of OZ Minerals' financial position after the company announced a trading halt in late 2008.
"These mum and dad investors are rightly concerned that the company failed to release important financial information that would have had a direct impact on the share price and their decisions to buy or sell their shares in OZ Minerals," Moulis said. "The market relies on being fully informed and with OZ Minerals, we believe, our clients were sadly let down."
The class action is listed for first directions in the Supreme Court of NSW on 3 September.