The law firm that brought the now-ended class action against IOOF has revealed that its client opted to bow out after observing the APRA showdown in September.
The wealth giant told the market on Monday it had reached the agreement in the Supreme Court of NSW, for the action to be discontinued with no order as to costs.
IOOF will be making no payment to the plaintiff, its lawyers at Quinn Emanuel, its funder Regency, or any other class member as part of the settlement.
Quinn Emanuel partner Damian Scattini stated the APRA case against IOOF last year had shaped its decision in the settlement.
The prudential regulator had brought a claim against the wealth group alleging that its entities, directors and executives had failed to act in the best interests of its superannuation members.
But the court ruled IOOF had not contravened its obligations under the SIS Act (Superannuation Industry Supervision Act 1993), to the disappointment of APRA. However, the regulator chose not to appeal the decision.
“The APRA proceeding was conducted in a surprising manner and it resulted in an unexpected outcome,” Mr Scattini said.
“Given the APRA decision, our client determined that it was no longer in the interests of group members to continue. The settlement specifically allows any shareholder or former shareholder who wishes to do so to file a claim, whether individually or as a class.”
Details of the action first broke in March last year, when Quinn Emanuel indicated it would be filing a claim against the wealth group on behalf of shareholders who acquired shares between 27 May 2015 and 9 August 2018.
The legal firm had alleged that during the period, IOOF contravened its continuous disclosure obligations under the ASX listing rules and engaged in misleading or deceptive conduct.
The case was built around IOOF’s shares losing more than 35 per cent of their value following revelations at the royal commission, and the commencement of various proceedings against IOOF subsidiaries and officers related to breaches by APRA.
Shine Lawyers also filed a class action against IOOF in the Federal Court almost a year later, on the behalf of shareholders who bought holdings between 1 March 2014 and 7 July 2015.
Maurice Blackburn had launched a suit in 2015 based on the same premise as the Shine action, using documents that whistleblowers had also shared with Fairfax, ASIC and the Senate.
But the Victorian Supreme Court restrained the class action from moving forward after IOOF then sued Maurice Blackburn, seeking the return of the confidential documents. The legal firm had gained the documents through four former employees.
The Quinn Emanuel settlement still requires court approval, with the plaintiff agreeing to seek it at the “earliest opportunity”.
IOOF said it was “very pleased” with the outcome.
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Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
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