Gadens mulls iSignthis class action

29 January 2020, Written by Business News Australia

Gadens mulls iSignthis class action

National law firm Gadens is investigating a possible class action against payment identity verifier iSignthis (ASX: ISX), adding salt to the wounds of a company that has been suspended from trading since October and has a court case of its own pending against the ASX.

The Melbourne-based fintech founded and led by CEO John Karantzis has come under fire over regulatory issues with clients in Europe, where the bulk of the company's sales take place. 

Gadens' investigation will home in on several issues that have plagued ISX over the past four months, including the share market operator's concerns over disclosures and the release of $500 million worth of performance rights to executives.

The circumstances surrounding these rights were harshly criticsed in a report from Ownership Matters, leading the ISX share price to plunge 40 per cent in one day.

Led by Gadens partner Glenn McGowan QC, the firm will aim to determine whether unlawful conduct has occurred which might found a claim for failing to keep the market properly informed.

A profit downgrade from $10.7 million to $6.5 million announced in December will be under the microscope.

"Gadens is investigating whether ISX and/or its directors had a reasonable basis to issue the Initial FY19 Guidance and the extent to which ISX and/or its directors have complied with their continuous disclosure obligations to keep the market fully informed of all material matters affecting the price of ISX shares," Gadens states.

"Claims potentially available to ISX shareholders may include breaches of continuous disclosure obligations, misleading and deceptive conduct, and breaches of directors' duties."

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