SurfStitch Class Action Update

SurfStitch Class Action Update

IMPORTANT NOTICE TO GROUP MEMBERS

Proceedings 2017/193375 & 2017/347082

15 April 2020

On 23 March 2020 and 14 April 2020 the Honourable Justice Ball made orders that due to:

  1. The change in the law in December 2019 following the High Court decision in BMW v Brewster, which invalidates the operation of the common fund order previously sought by the Plaintiffs in the First Notice Regime; and
  2. the SurfStitch Deed Administrators re-evaluating their estimated value of the convertible notes available in the SHPL and SGL Deeds of Company Arrangement (DoCAs) from $6m to $19m to $0 to $4.25m and cash from $2.7 m to $3m, to $2.4m to $2.7m,

the settlement participation deadline be extended to 4 pm AEDT on 24 April 2020 (Second Registration Deadline), and that all group members who either did not register under the First Notice Regime  during November 2019 or who previously opted out (Non-Participating Group Members) be given the opportunity to re-register for the settlement of the SurfStitch Class Actions.

 

Second Registration Notice Material

If you have been identified as a Non-Participating Group Member, a Funded Group Member or a registrant of the First Notice Regime, you would have received or will shortly receive from Gadens either by post, or by email the following:

  1. Second Notice to Group Members regarding the proposed settlement of the SurfStitch (Schedule 1);
  2. Group Member Registration and DoCA authorisation form (Annexure A);
  3. McConnell Orders made 23.3.20; and
  4. Nakali Orders made 23.3.20

(collectively, Second Registration Notice Material)

 

Proving your claim in the Settlement

Gadens has been working closely with the SurfStitch Deed Administrators to ensure the group member registrations are also accepted in the SHPL and SGL Deeds of Company Arrangement (DoCAs). To ensure your losses are accepted and your claim to the DoCA pool fund (which will flow into the CAS Pool on settlement approval) is valid, both the Plaintiffs and the Deed Administrators require all registered members to prove their reliance on the ASX announcements for the period 27 August 2015 to 9 June 2016 which lead to group members buying, selling or retaining shares during that period.

All group members contacted by Gadens, and who wish to participate in the settlement must by 4:00 pm AEDT on 24 April 2020 complete their electronic registration form. You can access your unique electronic form, with your details pre-populated by clicking the URL link contained in the covering letter/email received from Gadens. Each group members’ unique SurfStitch HIN/SRN number is also featured in the covering letter or email received. The electronic registration form can be signed electronically, and a digital version will be sent to you via email once submitted.

We request that each registrant please complete their form electronically, ensuring that you answer your reliance and disclosure questions accurately.

 

What if I have already registered for the settlement or I am a Funded Group Member?

Funded Group Members and registrants of the First Notice Regime must also complete the electronic registration process above, to ensure their reliance and disclosures answers are captured and passed on to the SurfStitch Deed Administrators.

 

What if I do not have a HIN/SRN number?

A HIN/SRN number will not be featured in your Second Registration Notice Material if you traded your shares via a custodian or broker. If this applies to you, when completing your registration please:

  1. insert your custodian account number in the HIN/SRN field;
  2. insert your custodian name in the comments box on the form; and
  3. Forward an email to vic-surfstitch@gadens.com with your name, HIN/SRN number, your custodian account number and name in the subject line, and attach copies of your balance statements and Buy/Sell certificates for the period 27 August 2015 to 9 June 2016. Please ensure all your proofs of trade are contained in one email to us.

 

From what data is my loss assessed?

Your claim loss will be assessed based on your trades under your HIN/SRN number, unless you traded through a custodian or broker. If you fall into the latter category, your trade proofs supplied will be used for assessment.

 

What if I traded my SurfStitch shares through multiple accounts?

If you held shares in the names of multiple accounts (ie a personal account, a superannuation fund, or via a corporate entity) a separate registration form must be completed for each account. Group Members may therefore receive separate material and URL links from Gadens as applicable.

If you received material for one account, but not for other(s) please visit our home page, and click “Register for Settlement” to register each account for which you did not receive material. Your HIN/SRN number must be inserted for each account.

 

What if my URL link does not work?

Group Members who are experiencing technical difficulties can register for the settlement using the “Register for Settlement” process above and complete a generic version of the form. Please ensure you enter all the compulsory data fields (specifically your HIN/SRN) which will help us track your registration.

 

What if I have not received the Second Registration Material?

If you think you may be a group member but have not received the Second Registration Material from Gadens, you can register for the settlement via the “Register for Settlement” process on our home page. You qualify for the class action if you:

  1. acquired shares between 23 October 2015 and 9 June 2016 and retained shares on any of 25 February 2016, 3 May 2016 or 9 June 2016 (Acquisition Class); and or
  2. already held shares on 23 October 2015 and retained shares during the above periods relying on the forecasts and statements issued by SurfStitch (Retention Class)

It is possible to be a member under both sub classes, depending on when you traded your SurfStitch shares.

 

When is the Settlement Approval Hearing?

The Settlement Approval hearing is currently listed before Justice Ball on the 22 May 2020. At this stage, due to COVID-19 developments, an electronic hearing will be conducted.

Once Settlement Approval is granted by the Court, settlement distribution will occur in accordance with the Amended Settlement Distribution Scheme approved by the Court, accessible here.

Should group members have any other queries or concerns in relation to your registration, please contact the Gadens Team via email at vic-surfstitch@gadens.com or call our office on

03 9252 2555.

We will continue to keep Group Members advised of developments via our website.

 

Glenn McGowan QC

Partner & Chief Counsel

Rebecca Di Rago

Associate

vic-surfstitch@gadens.com

This update does not constitute legal advice and should not be relied upon as such. It is intended only to provide a summary and general overview on matters of interest and it is not intended to be comprehensive. You should seek legal or other professional advice before acting or relying on any of the content.