Dick Smith class action picks up momentum

Formally filed in Supreme Court of NSW.

Bannister Law has formally filed a class action in the Supreme Court of NSW against DSHE Holdings Ltd and two former directors, Nicholas Abboud and Michael Potts. The proceedings were filed on behalf of DSHE shareholders who purchased shares during the period 16 February 2015 to 3 January 2016 inclusive. The class action is being funded by one of the world’s largest and most experienced dispute resolution funders, Vannin Capital.

The class action alleges that DSHE, Abboud and Potts contravened the provisions of the Corporation Act as DSHE’s financial statement results published to the market in 2015 were misleading and deceptive – they did not give a true and fair view of the financial performance of DSHE and were not prepared in accordance with Australian Accounting Standards. In particular, it is alleged that the accounting treatment of rebates by DSHE artificially inflated its reported profit and overstated EBITDA.

Bannister Law principal, Charles Bannister said, “We are eager to pursue this class action so that affected shareholders can be compensated for the misleading and deceptive conduct of DSHE and its two former directors. The inflated reported profit and overstatement of EBITDA meant that shareholders did not have an accurate picture of the financial health of the company when they purchased DSHE shares throughout 2015.

“They are all very disappointed to have been let down by a company they believed in so much. We have already had a large number of people register their interest in the class action who purchased shares within the relevant period. They have collectively lost several million dollars.”

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