THE Federal Court judge hearing the shareholder class action against grains exporter AWB was puzzled on Friday by the argument that AWB executives knew how disclosure of their dealings with Saddam Hussein's regime could affect the company's share price.
"How stupid could they be if they thought it was material and they continued doing what they did?" asked Justice Lindsay Foster.
The shareholders' barrister, John Sheahan SC, replied: "There could be many answers to that, one of which is: very stupid," as The Age reported.
The barrister also said the executives countered the continuous disclosure law in trying to protect the business by not saying anything.
"The statute requires information of this kind to be disclosed even if, perhaps especially if, the disclosure is going to cause the share price to tank," Sheahan said.
The judge asked whether the share price of the company may have been affected differently had AWB released the information instead of alloing the Cole Inquiry to drag it out.
Sheahan confirmed there was a direct connection between AWB's breached of the disclosure law and the impact on its share price. Instead, he said it was dragged out of AWB "in a brutal fashion".