Billabong settles class action lawsuit! But doesn't admit to wrongdoing! The rare win-win!
The surf industry is a very strange nightclub’s backroom, roped off from the main party and dancing to its own strange DJ named Cutsnake. Few people enter. Nobody leaves. Conversations mutate while the records spin and paranoia descends like smoke from the smoke machine. Or, wait. Maybe that is smoke from the smoke machine? Does it smell the same? Musty? I think so.
In any case, it is an eddy near the shoreline of a rushing river where water stagnates and refuses to travel toward the sea. No water in. No water out. Or, wait. Is that how eddies work? Do they actually stagnate? Water has to come in right? But if water is coming in and not leaving then wouldn’t that part of the river overflow its bank? Is that what happens?
In any case, it is ridiculously cloistered and it can be because so few people are watching, listening or care. And so, in the surf industry you will see higher ups peddling straight bizarre lies (Hello, WSL CEO Paul Speaker! How much does Kelly Slater earn, per year, again? How deep is Cloudbreak?) and you won’t see any repercussions. Because so few people are watching, listening or care!
But apparently, courts and lawyers in Australia bent their ear for a few moments last week and slapped Billabong with a 45 million dollar bill for “allegedly misleading and deceiving shareholders” with its earnings forecast. Let’s read about it in the Gold Coast Bulletin!
GOLD Coast-based surfwear group Billabong will pay a total of $45 million, inclusive of legal costs, to settle the claims of a class action.
The class action began in 2015 and was pursued by law firm Slater and Gordon on behalf of about 730 institutional and retail investors who acquired Billabong securities between February 18, 2011 and December 19, 2011 and also registered to participate in the class action.
Proceedings were launched in the Victorian Federal Court, accusing Billabong of engaging in misleading and deceptive conduct over a series of earnings updates almost four years ago.
It sought unspecified losses and damages for a Melbourne retail investor, Newstart 123, trustee of the Malone Family Superannuation Fund, which lead the claim and whose $30,000 investment in Billabong was slashed in value by more than 50 per cent.
The action accused Billabong of failing to comply with its continuous disclosure obligations. It said the fund would have acquired Billabong shares at a lower price, or bought shares ‘in another listed entity instead’’ if the surfwear giant had not allegedly misled or deceived shareholders with its earnings forecasts.
Slater and Gordon Class Action Lawyer Odette McDonald said the proposed settlement was a ‘fantastic result and class action participants will no doubt welcome the news’.
“This is an excellent outcome for group members and, based on our assessment of their losses, investors will receive a strong return if the settlement is approved,” Ms McDonald said.
“Slater and Gordon’s class action was supported by a large group of current and former shareholders, ranging from small retail investors to prominent institutional investors”.
The lead plaintiff in the action was Newstart 123 Pty Ltd, trustee for the Malone Family Superannuation Fund.
The proposed settlement will be put before the Federal Court for approval, and class members will receive details of the proposed settlement shortly. Billabong makes no admission of liability under the terms of the settlement agreement.
And ain’t that great? I like making no admission of liability for 45 million dollars.
But really, if investors want to pour money into surf and expect rigorous, detailed truths they should maybe watch some World Surf League events first and listen to the upcoming EPIC conditions that are guaranteed to thrill JUST around the corner! Then wait for it…wait for it…oops! 2 ft onshore slop!
Hello again, WSL CEO Paul Speaker!