04/02/2010 - 08:36

Fortescue ready to fight ASIC appeal

04/02/2010 - 08:36

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Fortescue Metals Group says it will vigorously defend an appeal the corporate watchdog has lodged regarding a ruling that found in favour of the miner and its chief, Andrew Forrest.

Fortescue Metals Group says it will vigorously defend an appeal the corporate watchdog has lodged regarding a ruling that found in favour of the miner and its chief, Andrew Forrest.

Earlier today, the Australian Securities and Investments Commission said it had filed an appeal against the Federal Court ruling delivered last month.

ASIC had claimed Mr Forrest and his company misled investors over the status of deals it had signed in 2004 with Chinese companies.

At the time, the iron ore miner told the sharemarket it had "binding contracts" with Chinese companies to develop its Pilbara projects.

Justice John Gilmour deliberated for seven months before handing down his verdict last month, dismissing all ASIC's claims before awarding costs to Mr Forrest and the company.

The loss by ASIC was one of a number of high-profile legal losses by the regulator.

Today, Fortescue chairman Herb Elliot said the company and Mr Forrest were disappointed over ASIC's decision to appeal.

"While we recognise ASIC has a legal right to Appeal, the judgment was unequivocal in our favour," Mr Elliott said in a statement.

"It is disappointing that after nearly three years of legal proceedings which concluded in a strongly worded judgement in favour of the defendants, ASIC has still elected to pursue the Company and Mr Forrest."

He added that Fortescue and Mr Forrest have prepared their respective legal teams to maintain the vigorous defence during the appeal process.

ASIC today said that the findings of Justice Gilmour raised important issues as to the proper interpretation and application of provisions of the Corporations Act.

Aspects of the law that govern company announcements such as the misleading and deceptive conduct provisions, the continuous disclosure provisions, and directors duties warranted review, it said.

"It is part of ASIC's regulatory role to ensure that the laws which impose obligations on listed companies and their executives to keep the market properly informed are properly enforced, including by the exercise of its appeal rights."

ASIC has already said it intends to appeal other recent court losses against One.Tel founder Jodee Rich and former AWB boss Andrew Lindberg.

 

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