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Nine lawyers lined up in the High Court at Christchurch for a bid by former directors, owners and advisers of carpetmaker Feltex to block a claim from shareholders who are trying to recover their money lost when the company collapsed.
The hearing of about 12 interlocutory matters is in chambers and is expected to last almost all week, the Christchurch Court News website reported.
Because it is in chambers, the proceedings in the court cannot be reported by the news media.
In June 2004, Feltex shares were worth $254 million but all of that was lost when the company went into receivership in 2006. There were about 10,000 shareholders.
Justice Christine French today began hearing the bid to have the claim - being made for two representative shareholders - struck out.
The first cause of action in the case's statement of claim is under the Fair Trading Act, that the plaintiffs had suffered the loss of the money used to purchase shares, and seeks an order from the court that the defendants repay that money.
The statement of claim says the shares had been bought in reliance on the registered prospectus and alleges that the defendants failed in their duty to exercise reasonable care.
The shareholders' action is also against the former owner of Feltex, US-registered private equity house Credit Suisse First Boston Asian Merchant Partners, its associated company Credit Suisse Private Equity Inc, and joint lead managers First New Zealand Capital and Forsyth Barr.
If the case proceeds to a full hearing in front of a judge, it is unlikely to be heard before next year.
- NZPA
