Law firm Glaister Ennor and Australian litigation funder IMF Bentham applied to the High Court on Monday to start a class action against CBL Corp on behalf of Basil Ian Livingstone and others.
That puts the suit on a collision course with another funded by local litigation funder LPF Group and backed by CBL's major institutional shareholders Harbour Asset Management, Australia-based Argo Investments and broking firm Forsyth Barr.
A crucial difference is that the LPF-backed suit is against both CBL and its directors while the IMF-backed claim is tackling solely the company, which is in liquidation, and whoever its insurer is, in the belief that that is the easiest way to claim money for out-of-pocket investors. The IMF-backed claim has been filed at the High Court in Auckland.
As the LPF-backed claim has said, CBL directors received nearly $60 million from selling shares, and likely have insurance themselves, in addition to any cover CBL itself held.
The LPF-backed suit filed a statement of claim in the High Court in Wellington on October 31 and LPF director Phil Newland has said the courts are unlikely to allow both to proceed.
Investors backing the LPF suit own a combined 15.3 per cent of CBL – valued at $114.4m or $3.17 a share, the last price they traded at on NZX in February 2018.
Another of the major institutional shareholders, ACC, which owns 4.3 per cent of CBL, said it hasn't supported either suit and "we're still considering our options."
After months of refusing to name shareholders who had signed on to its suit, Glaister Ennor this week disclosed that the plaintiff will be Livingstone.
The last comprehensive list of CBL shareholders filed with the Companies Office shows Livingstone and Ryan Joseph Harvie, both of Hamilton, jointly owned 63,192 shares in March 2017.
Glaister Ennor said that "there is no link between Mr Livingstone and the directors of CBL.
"No director, or former director, or any relative or related entity of a director or a former director of CBL is permitted to be part of the group of shareholders that Mr Livingstone represents," it said in a statement.
"We will not be making any further comment at this stage."
However, there is a direct link between Glaister Ennor joint managing partner Jack Porus, the barrister hired to represent the IMF-backed suit, Philip Skelton, QC, and former CBL chair John Wells.
The three men sat on the same school trust board for a number of years.
Porus has previously said Wells resigned from the trust board before Glaister Ennor was instructed to advise on the CBL action.
"There have been growing calls for accountability from our shareholder clients, as well as industry leaders, following the collapse of CBL," Porus said this week.
"Glaister Ennor and Philip Skelton QC are answering those calls, with the support of IMF, in seeking compensation on behalf of those who have suffered significant losses as a result."
The statement, issued under IMF Bentham's letterhead, says the litigation will be funded on a "no-win-no-pay basis" and that IMF underwrites all the costs.
Although it was listed on both NZX and ASX since its float in September 2015, and based in New Zealand, CBL's principle business was selling construction insurance in France.