Investors question delays in RCR Tomlinson lawsuit

afr.com:

A class action against collapsed engineering group RCR Tomlinson will make a second attempt at mediation this month as investors question why the lawsuit has taken almost five years to resolve.

RCR’s sudden collapse in November 2018 just months after raising $100 million in equity left shareholders, including institutions such as Perpetual, Pendal Group and Allan Gray, holding worthless stock.

A class action lawsuit was filed in the NSW Supreme Court by Quinn Emanuel Urquhart & Sullivan just days before administrators McGrathNicol were hired following a plunge in RCR’s share price and a trading halt due to hefty write-downs on solar projects.

Engineering group RCR Tomlinson collapsed in 2018 after losing money on solar farms Glenn Hunt

But the class action, which was financed by the US’s Burford Capital and Omni Bridgeway and alleged breaches of continuous disclosure rules, has taken years to proceed to court, worrying small investors who had the value of their shareholding wiped out.

Investors who lost money on their RCR shares have been unhappy with the lack of progress, raising concerns that law firms are benefiting financially from the delays and questioning why the lawsuit has not been settled faster.

One investor who held tens of thousands of dollars of RCR stock in a self-managed superannuation fund toldThe Australian Financial Review that he was suspicious about how competently and efficiently the litigation was being prosecuted.

Damian Scattini, partner at Quinn Emanuel, told the Financial Review that an attempt to mediate the lawsuit was made unsuccessfully on May 30, but that the law firm was hoping to settle the class action at another mediation session on August 24.

Mr Scattini attributed the delays to the