General FAQs

Why should I sign with Bannister Law?
What is a class action?
Am I included in the Class Action?
What is Bannister Law claiming?
How much compensation will I receive?
The Fee Agreement says there is a fee – what is this fee?
Can I terminate the Fee Agreement once signed?
What if we lose?
What if we win?
What is a Litigation Funder?
What does the litigation funder receive if we win
Time frame
My shares are registered in a company name, superfund or trust. What should I do?
 

Why should I sign with Bannister Law?

As a shareholder who acquired an interest in Dick Smith Holdings (‘DHS’) (In Liquidation) shares on the Australian Stock Exchange in the period 16 February 2015 to 3 January 2016, you are a person who is known as a potential “Group Member” (or Class Member) in the class action against Dick Smith Holdings Limited (In Liquidation) (ACN 166 237 841). In October 2017, Bannister Law filed a claim on behalf of the entire “class” of plaintiffs (“Group Members”).

As a potential Group Member, you are not obliged to sign an individual client agreement with Bannister Law. If you remain a Group Member, you will be informed of matters affecting the whole class from time to time, in accordance with orders made by the Court.

You have an option to sign up as an individual client with Bannister Law. Signing our Fee Agreement allows us to act for you on an individual basis as a client.

The benefit of signing as an individual client is that we can assess your individual losses, provide tailored advice, respond to your questions and provide you with updates outside of court mandated correspondence.

What is a class action?

Class actions are legal proceedings brought by one person on behalf of a group. Rather than each person pursuing a claim separately, a class action streamlines the process, enabling a dispute involving large numbers of people with common issues to be resolved through a single case.

Importantly, a class action pools legal expenses across members of the class. This makes it far more cost effective than each claimant pursuing legal action separately.

Am I included in the Class Action?

If you acquired shares in Dick Smith Holdings Limited (in liquidation) on the Australian Stock Exchange in the period of 16 February 2015 to 3 January 2016 and suffered loss or damage by reason of the contraventions of the Defendants set out in the Statement of Claim, then you are included in this action and can claim for loss suffered.

If you did not purchase shares during this period, unfortunately we will not be able to represent you as a Group Member or individual client.

What is Bannister Law claiming?

Once you sign our Fee Agreement, you will be a direct client of Bannister Law.

The class action will seek damages as a result of the alleged conduct by the Defendants. The Defendants are Dick Smith Holdings Ltd and two of its former directors.

The Plaintiffs in the class action brought by Bannister Law allege that from May 2014 and throughout 2015, the management of DSH pursued a policy of maximising rebates given to DSH by vendors and suppliers. It is alleged that because of the rebate maximisation practices, purchasing decisions were made by DSH management on the basis of rebates that could be obtained from suppliers in respect of particular products, leading to an accumulation in inventory which became increasingly aged or obsolete and therefore difficult to sell.

The Plaintiffs further allege that DSH adopted accounting practices and made accounting decisions that were not in accordance with certain Australian Accounting Standards, leading to artificial inflation of DSH’s reported profit. It is alleged that the result of DSH’s buying practices and the accumulation of poor stock meant that DSH was required to write off significant volumes of stock.

The Plaintiffs allege that despite these practices, representations were made that DSH’s financial accounts were prepared in accordance with the Australian Accounting Standards. For the reasons mentioned above, the Plaintiffs allege that these representations were misleading or deceptive in contravention of the Corporations Act.

Bannister Law is claiming the following for the loss suffered by the Plaintiffs and Group Members:

a) the difference between the price at which they acquired their interest in DSH shares and the true value of that interest (that difference will be proved in evidence); or
b) alternatively, the difference between the price at which they acquired their interest in DSH shares and the market price that would have prevailed but for the pleaded contraventions (that difference will be proved in evidence).

The Court will decide whether any damages claim may be allowed if the class action succeeds.

5. How much compensation will I receive?

Any potential compensation (or damages) awarded to you will depend on the Court’s final decision when the class action concludes, or alternatively, under the terms of any settlement agreement.

The Fee Agreement says there is a fee – what is this fee?

The Fee Agreement outlines information about the costs of our legal services to quantify and assess your individual loss as an individual client of Bannister Law. We estimate the fees charged to the Litigation Funder to calculate your individual loss to be in the order of $300 to $1500.

The fees charged to you individually will depend on the number of shares held, the frequency of trading that you made, and the work required to calculate your losses in the event of a resolution or judgment. The Litigation Funder agrees to pay your fees under this Fee Agreement.

Note your estimated legal fees are made up of the individual fees incurred for time spent by our team on work done directly on your claim. This may include correspondence or emails with you and the assessment of your claim. We will claim this amount against the Defendants if the class action is successful.

There are no up-front costs in signing the Bannister Law Fee Agreement.

Can I terminate the Fee Agreement once signed?

There is a 5 business day cooling off period for the Fee Agreement. If you decide to terminate within that 5 day period, you will not be charged anything.

This includes Bannister Law’s fees and the fees of the successful party, commonly known as adverse costs orders. Usually the unsuccessful party pays the costs of the successful party in litigation. These costs will be covered by the litigation funder (see Question 7 below).

What if we lose?

If the class action is unsuccessful, you will not be required to pay anything.

This includes Bannister Law’s fees and the fees of the successful party, commonly known as adverse costs orders. Usually the unsuccessful party pays the costs of the successful party in litigation. These costs will be covered by the Litigation Funder.

What if we win?

If the class action is successful, as a client of Bannister Law your estimated legal fees will be claimed from the Defendants on your behalf for individual costs.

If the class action is successful, we will charge an uplift fee of 25% on the unpaid component of our fees. This uplift fee will also be claimed against the Defendant(s).

Any fees that are not paid by Dick Smith Holdings will be paid by the funder. In the event the fees are not paid by the funder, you will not be liable for the outstanding fees.

We confirm that there will never be an instance in which you will be liable for any out of pocket costs to Bannister Law.

What is a Litigation Funder?

A Litigation Funder is a third party who provides financial assistance during the litigation.

What does the litigation funder receive if we win?

Bannister Law has engaged a Litigation Funder.

A Litigation Funder pays for the costs of the litigation and indemnifies the lead plaintiff against any potential adverse costs orders.

In return, the Litigation Funder is entitled to:

a) the reimbursement of its costs in funding the case; and
b) a percentage of the potential gross settlement sum;

subject to the approval of the Court.

The potential percentage is dependent on the number of DSH shares you acquired an interest in between 16 February 2015 and 31 December 2015, and the stage at which the claim resolves. A breakdown is available in Schedule A of the Vannin Capital Litigation Funding Agreement.

As you have the option of signing a Funding Agreement as an individual client of Bannister Law. This agreement is an acknowledgement signed by you in which you accept that the Litigation Funder is entitled to a percentage of the potential total settlement awarded by the Court, and is a separate contract that you enter into with them.

Time frame – how long will the class action take?

Orders were made on 14 May 2018 in the Supreme Court of NSW that a trial date be tentatively set for 30 September 2019. A tentative duration of 12 weeks has been estimated as the time frame for the trial.

My shares are registered in a company name, superfund or trust. What should I do?

If you are a director of an incorporated entity and/or otherwise hold appropriate authority, you are able to sign the agreement on behalf of the company, superfund or trust.

If you have a superfund or trust, please contact us at dshclassaction@bannisterlaw.com.au as we will need to prepare a customised Bannister Law Fee Agreement and Vannin Capital Litigation Funding Agreement which accurately reflects this information.