Feltex shareholders go to court

Feltex collapsed in 2006, causing 8000 investors to lose millions of dollars. Photo / Hawkes Bay Today

More than 3600 former Feltex shareholders are now opted into litigation against the carpet-maker's former directors and an updated list of claimants has been filed with the High Court.

The representative action alleges Feltex's prospectus in 2004 - the year it floated - contained information that was misleading or wrong, or omitted to make information available that would have affected investment decisions.

Feltex collapsed in 2006, causing 8000 investors to lose millions of dollars.

Investors, represented in court by Feltex shareholder Eric Houghton, are seeking a refund of the purchase price of their shares, plus associated interest and costs.

The first part of the case is due to begin in the High Court at Wellington next March and investors had until recently to opt-into the case.

According to an update filed to the court on Friday, 3639 former Feltex shareholders have opted-in and are now represented in the litigation.

The defendants, who have denied the claims against them, include former chairman Tim Saunders, former chief executive Sam Magill and former directors John Feeney, Craig Horrocks, Peter Hunter, Peter Thomas and Joan Withers. Former director John Hagen is not involved in these proceedings.

Also targeted in the proceedings is Credit Suisse First Boston Asian Merchant Partners (which offered Feltex for sale), Credit Suisse Private Equity and joint lead float managers First New Zealand Capital and Forsyth Barr.

While 3639 shareholders are opted-in, some investors may be unable to take part in the litigation if an appeal to the Supreme Court succeeds.

In April, the Credit Suisse respondents were given leave to appeal to the Supreme Court on whether some or all of the shareholders represented by Houghton were time-barred from the proceedings. This is due to be heard in October.