Tweed Sues Cba For Blocking Access To Shareholders
Sydney Morning Herald
Wednesday September 10, 2003
Sharemarket scavenger David Tweed has accused the Commonwealth Bank of changing the format on a copy of its share register to stop him making offers to the bank's 727,000 shareholders at below market price.
The West Melbourne dealer is suing the bank for damages in a case that could set a computer-era precedent for all companies requested to supply their registers to firms plotting takeovers or individuals wanting to call shareholder meetings.
Earlier this year CBA, responding to a request, provided Mr Tweed's company, National Exchange, with a CD-Rom of its ordinary and its exchange tradeable reset preference shareholders. But all the information was graphically embedded so he could read it only by feeding in names one by one.
His counsel, Ian Waller, told a directions hearing before Justice Alan Goldberg in the Federal Court yesterday that this raised the question of whether the bank had supplied National Exchange with its register.
``If, as we suspect, it is kept in text format, the Commonwealth Bank has gone through a fairly elaborate process to transfer it from one form to another to provide us with a CD-Rom," he said.
Mr Tweed is seeking damages that are as yet unspecified but could run into hundreds of thousands of dollars. He claims the bank's action prevented him making his offers before legislative changes in April forced him to give shareholders better information on the value of their holdings.
Mr Waller confirmed that Mr Tweed stood to have gained more profit had he been able to make the offers before the changes.
When Justice Goldberg said that the damages were speculative, Mr Waller said they amounted to loss of opportunity.
Mr Tweed is also seeking a declaration that the bank had contravened the Corporations Act. The action also names the CBA's Sydney share registry, ASX Perpetual Registrars, for aiding and abetting the bank to contravene sections of the Act.
Section 173 gives anyone the right to inspect a share register and receive a copy within seven days of asking for it. It says data, if requested, must be provided on a floppy disk. It must be readable.
Justice Goldberg said this was an instance where the written law was behind the technology of CD-Roms and memory sticks.
Section 177 restricts the use of the information obtained. It says a person must not contact or send material to a shareholder unless it is relevant to the interests recorded on the register.
CBA's counsel, Matt Connock, said that at issue was what did access by computer mean. In 2003, inspection would be undertaken by accessing information by computer and it involved the means of delivery of relevant information by computer.
The case was adjourned.
© 2003 Sydney Morning Herald