Phi Finney McDonald acts for the Representative Applicant in class action proceedings commenced in the Federal Court of Australia against Deloitte Touche Tohmatsu (DTT) and Deloitte Corporate Finance Pty Ltd (Deloitte Entities), on behalf of investors in building services company Hastie Group Limited (Hastie). The class action is funded by litigation funder Omni Bridgeway.
Until 2012, Hastie was an ASX-listed company providing technical services to the building and infrastructure sectors in Australia and overseas. DTT acted as Hastie’s auditor from 2005 to 2012. On 14 June 2011, Hastie lodged a ‘Pathfinder Prospectus’ with the ASX for a $160m capital raising by way of institutional placements and a renounceable entitlement offer. On 17 June 2011, Hastie lodged a largely identical formal Prospectus for the capital raising. The Pathfinder Prospectus and Prospectus each contained pro forma financial statements for the year ending 30 June 2011, and forecasts of Hastie’s likely future earnings. The financial statements and forecasts were reviewed by the Deloitte Entities, which issued reports included in the Prospectus documents. In the months following the successful completion of the capital raising, the company announced a series of asset impairments, substantially downgraded its full year earnings guidance, and announced an anticipated earnings loss of $146m for the half year ending 31 December 2011. The company was placed into voluntary administration shortly thereafter. PPB was appointed as administrators, and later liquidators of Hastie. On 21 January 2013, PPB Advisory released its Administrators’ Report to Creditors of Hastie.
About the Class Action
On 13 June 2017, Sadie Ville Pty Ltd (as trustee for Sadie Ville Pty Ltd) issued representative proceedings in the Victorian Registry of the Federal Court of Australia against the Deloitte Entities, on behalf of persons who acquired an interest in shares in Hastie in the period from 14 June 2011 to 21 February 2012 (inclusive) and who entered into a litigation funding agreement with Omni Bridgeway in relation to the proceedings on or before 9 June 2017 (group members).