iSignthis (ASX: ISX) has submitted an amended statement of claim on Tuesday to strengthen its demand for AU$462 million in damages from the Australian Securities Exchange (ASX) for the suspension of ISX trading on the exchange since October 2019.
The statement of claim includes new evidence obtained by the company from ASX with a court order. It mostly covers minutes of several conversations between the exchange and the Australian Securities & Investments Commission (ASIC).
According to the filing, the Australian exchange did not have any solid reason to suspend the quotes of ISX shares, and it discussed the matter with the financial market regulator.
Unveiled Minutes of Conversations
“Upon revisiting these ISX documents already in ASIC’s possession, it did not reveal a ‘smoking gun’,” said Tom Veidners, ASIC’s Senior Manager of Market Surveillance, on a telephonic conversation with representatives of ASX on October 1, 2019.
“ASIC was not in possession of the ultimate source documents to verify,” he added. and asked, “whether a suspension is something that ASX has considered.”
In the same conversation, ASX’s Chief Compliance Officer, Kevin Lewis said: “We have considered it but we don’t have hard evidence.”
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“As much as we would like to suspend, unless ASIC gives a direction, at the current juncture we do not have sufficient evidence,” Lewis added. Another representative of the ASX said that they were ‘spitballing’ and the ASX would like to see a ‘suspension pending enquires by ASX and ASIC’.
Additionally, the court filing showed that multiple ASX representatives pointed out the ‘major litigation risk’ to the exchange operator if ISX share trading were suspended under the circumstances.
But the exchange consecutively suspended ISX trading citing media speculation, volatility in ISX’s share price, the fact that the company was providing services to cryptocurrency exchanges and concerns from ASIC.
Seeking Heavy Damages
However, iSignthis was quick enough to move to court and is seeing AU$464.7 million in damages, an amount that increased over the period and is likely to escalate further.
Talking to Finance Magnates, iSignthis CEO, John Karantzis said: “On behalf of my 10,000 Australian shareholders, many of them ordinary mums, dads, pensioners and young investors, I am outraged by the callous action of the ASX. The ASX has completely disregarded iSignthis shareholders in pursuing their own misguided and misconceived agenda, designed to suspend and hurt the company, its shareholders, executive, customers, and partners.”
“The ASX was aware of the ‘major litigation risk’ it would be bringing upon itself, but clearly weighed that up against the strategic advantages of suspending ISX and muddying the Company’s reputation with its unfounded assertions.”