The New South Wales Supreme Court has thrown out a claim by former iSOFT executive Gary Cohen over a portion of the company which appears to be owned by investment house Oceania Capital Partners.
In late April Oceania — a 24 percent investor in the troubled e-health giant, which is currently subject to a buyout offer by US IT services giant CSC — revealed that a company controlled by Cohen had requested that Oceania hand over a transfer notice with respect to about 15 percent of Ocean’s holding. Cohen, who has had a long history with iSOFT and its predecessor IBA Health, left the company in mid-2010 as its financial woes deepened.
At the time, Oceania added that Cohen’s company RJL Investments had initiated legal action against Oceania with respect to the matter, with the action being popularly seen as an attempt by Cohen as a first step towards blocking the CSC buyout.
However, in a statement published to the ASX this morning, Oceania said the matter had been thrown out of court last Friday 20 May. “The Supreme Court found that the propositions of RJL in relation to the pre-emption deed were without foundation and the court dismissed RJL’s proceedings with costs,” wrote Oceania. “The court found that the CSC proposal does not activate the provisions of the pre-emption deed.”
Cohen declined to comment on the matter this morning.
Oceania noted that its position regarding the CSC buyout remained the same — in essence, Oceania supported the US company’s acquisition proposal, subject to there being no other proposal put forward before iSOFT shareholders could vote on the matter, and an independent expect concluding that the buyout was in the best interests of shareholders.
“OCP’s present intention is to support the approval of the proposal,” the company wrote, adding it would inform the ASX if Cohen’s company appealed the ruling.
When iSOFT prepared its annual report for the year ended 30 June, the company’s other major shareholders were JP Morgan, HSBC, the National Australia Bank and other financial institutions, as well as what appeared to be Oman group the Zubair Corporation. At that time, Cohen’s company RJL held 1.9 percent of iSOFT’s stock.
In its April statement last Oceania alleged the executive had previously supported a CSC buyout of iSOFT. “After the performance of the iSOFT business deteriorated markedly and the share price collapsed, Mr Cohen stood down as the executive chairman in June 2010, ceased to be chief executive officer in August 2010 and resigned as a director in September 2010,” the company said at the time.
“While he remained an officer of iSOFT, Mr Cohen was involved in early meetings with CSC in relation to their interest in potentially making an offer for 100 percent of iSOFT, and Mr Cohen was supportive of those discussions.”
Image credit: Delimiter screenshot of iSOFT promotional video, believed to be covered under fair use