Callaghan sued after Trends funding cut

David Johnson, chairman and publisher of Trends Publishing International.

Trends Publishing, which had its taxypayer grant cancelled, is suing the Government's Callaghan Innovation for allegedly unlawfully suspending the funding.

Trends, which is based in Ellerslie and associated with home and design publication Trends Magazine, is seeking compensation from Callaghan.

Callaghan Innovation last year suspended and later cancelled a taxpayer research & development grant given to Trends. It also said it had referred the matter to the Serious Fraud Office (SFO).

The firm received $332,966 from Callaghan before the grant was put on hold.

Trends has now hit back and today said it had launched High Court action against Callaghan for the allegedly "unlawful suspension and later termination" of the grant.

"The grant supported an innovative and potentially highly lucrative Research and Development programme that was already in progress at Trends. The programme would result in new web-based browser technology being used to socially engage users through content and to connect them with other relevant parties," Trends said this afternoon.

The company said it wants redress for "damages to the Trends business, brand and staff".

It alleges Callaghan failed to follow its own procedures, created a draft report complied by inexperienced reviewers, referred the matter to the SFO when this draft report contained errors and publicly-announced the suspension of the grant without allowing Trends a proper opportunity to respond.

Trends' chairman David Johnson said the action was needed to "correct the inaccurate and seriously damaging information that has been put into the public arena."

"Trends has shown itself to be an innovative company for over 20 years and I'm horrified that we could be treated in this way," he said.

"Callaghan has been under public and political scrutiny about how it administers its hundreds of millions of dollars of funding, and we've been made a scapegoat...while I'm reluctant to go through all the stress and expense of taking legal action, I'm not prepared to see the company be a sacrificial lamb as a result of the inept actions of others that have got us to this point."