What is the CBL Class Action about?
The CBL Class Action is the legal action against the former CBL directors arising from false or misleading statements made in the IPO documents in September 2015 and ongoing breach of the continuous disclosure obligations by failing to disclose material information about its financial position to the market.
What is a class action?
A class action is legal action brought on behalf of a group of people who have the same or similar legal rights. One or more people in the group act as the representative plaintiff for the whole group.
Class actions allow access to justice for people who may not be able to bring their own individual legal action against a defendant.
Should I join the class action?
Legal action against the former CBL directors is likely the only avenue now left available for shareholders of CBL to seek compensation for the losses they have suffered as a result of the collapse of the company.
How do I know I am eligible to join the class action?
The CBL Class Action is open to any investor who:
was or is a shareholder in CBL; and
is not in any category of persons excluded from the class, being:
those associated with the directors or management of the CBL Group as set out in Schedule B of the plaintiffs’ amended statement of claim;
a member of any class approved in High Court proceeding numbered CIV-2019-404-2727 (Livingstone v CBL Corporation Ltd (in liq)) and who has formally consented to join that class; and/or
has claimed to have suffered financial loss due to:
false or misleading statements in CBL’s product disclosure statement issued on or around 7 September 2015 in connection with a proposed initial public offering of ordinary shares; and/or
breaches of continuous disclosure obligations concerning CBL through failures to immediately release material information to NZX; and/or
breaches of the fair dealing provisions of the Financial Markets Conduct Act 2013; and/or
How do I join the class action?
To join the CBL Class Action you need to opt-in to become a plaintiff. This requires you to sign and return the Participation & Funding Agreement by 14 October 2020. This is required for two key reasons:
The Court order approving the class action requires those who wish to opt in to sign the Participation Notice & Agreement
There is presently no common fund procedure in New Zealand. This means only those who have opted-in to join the legal proceedings can share compensation if the legal action is successful. It excludes anyone who has chosen not to join
Click here to register your interest in joining the CBL Class Action >
How much does it cost to join the class action?
There is no upfront cost to joining the class action. New Zealand’s pre-eminent litigation funder, LPF Group is funding the litigation on a success fee, at no upfront cost to the plaintiffs. LPF will be entitled to repayment of the costs it has funded and to its fees, out of any proceeds from the case.
Who is funding the class action?
New Zealand’s pre-eminent litigation funder, LPF Group, is funding the litigation on a success fee, at no upfront cost to the plaintiffs. LPF will be entitled to repayment of the costs it has funded and to its fees, out of any proceeds from the case.
Who is running the class action?
A CBL Class Action Claim Committee has been established to represent the plaintiffs in all matters relating to the class action. The Committee will work with the lawyers and LPF Group to manage the claim on behalf of the plaintiffs. They will be responsible for giving instructions to the lawyers and ensuring plaintiffs interests are represented.
The Committee has engaged a highly experienced legal team who have a deep understanding of the New Zealand legal and regulatory framework. The team consists of Justin Smith QC, Mike Colson, Jonathan Orpin-Dowell and law firm Meredith Connell.
Do I need to become a plaintiff to be entitled to a payment from the class action it is successful?
Yes. Only plaintiffs to the proceedings will be entitled to their share of any compensation arising from a successful outcome of the class action.
How much is my claim?
The amount of your claim will be the total estimated loss you have suffered as a result of CBL Corporation being placed into liquidation. The formula for determining your loss will be confirmed in upcoming court proceedings.
What do I get if the class action is successful?
We expect any successful outcome of the claim to be delivered through a final judgment of the Court or through a settlement reached with the defendants. From the proceeds of the claim, the funding advanced by LPF in relation to the claim will first be deducted and repaid together with LPF's success fee, with the rest being available for distribution to each plaintiff.
When will the claim be heard in the High Court?
The High Court has now approved the legal proceeding as a class action. We expect to have a case management conference with the Judge to decide what happens next and what the likely timing will be.
Will I have to pay anything if the legal proceedings are not successful?
New Zealand’s pre-eminent litigation funder, LPF Group, is funding the litigation on a success fee basis, at no cost to the plaintiffs if the proceedings are not successful.
How long is the legal process likely to take?
The time taken to complete a legal process is dependent upon a number of factors, including the availability of the courts and the position and tactics that may be adopted by the defendants. It is estimated by the legal team it could take between two and four years for this class action to be finally decided.
Will my personal details be kept private?
Your personal information will only be used for the purpose of the legal proceedings as required by the Court, or by law. The Privacy Act 1993 also applies to any personal information provided.
What documents do I need to keep as part of the class action?
You will be required to keep all documentation relating to the purchase or acquisition of shares in CBL Corporation and all communications with CBL Corporation.
How does the criminal action by the Serious Fraud Office and the FMA’s civil proceedings against the former directors of CBL impact on the CBL Class Action’s legal case?
The CBL Class Action is a shareholder led legal case which aims to seek meaningful compensation for shareholders who have suffered significant loss as a result of CBL’s collapse in 2018. We understand the key focus for the FMA is to establish that the defendants have breached their duties and for pecuniary penalties as well as clarify law and provide important legal precedents. So, while the FMA’s case, if successful, will impose fines on the directors, their proceedings aim to address wider public interest and regulatory concerns under the Financial Markets Conduct Act and are therefore unlikely to directly provide compensation for individual investors.
The SFO have also filed criminal charges in relation to the collapse of CBL Corporation.
How is the CBL Class Action different to the claim being brought by Australian based funder Omni Bridgeway?
Key points regarding the CBL Class Action include:
Our CBL Class Action seeks recovery of your shareholder losses by taking legal action against both the directors of the failed insurance company and the company itself.
Significant shareholders of CBL Corporation, Harbour Asset Management and Australian based Argo Investments have joined our CBL class action as representative plaintiffs.
The CBL Class Action committee have engaged a New Zealand team who are highly experienced in commercial litigation and class actions and have a deep understanding of the regulatory and legal framework.
The CBL Class Action is being funded by New Zealand’s pre-eminent litigation funder, LPF Group.
Can I join both legal actions?
Eligible shareholders who wish to opt-in to a legal action must choose to join only one claim. By signing the CBL Class Action Participation & Funding Agreement you are agreeing that you will not consent to participate or you will opt-out of joining other similar claims against CBL