A Hong Kong court has rejected a bid by Singapore-listed Noble Group for summary judgment against a credit analyst and his firm - said to have published the controversial Iceberg reports on Noble.
The court found that French national Arnaud Vagner, who worked for Noble for over two years until June 2013, was justified in answering queries from Noble "the way he did". The queries were made in legal preliminaries in the run-up to the suit against him.
"The answers can be fairly described as 'further and better particulars of the defence and were made by (the defendants) in good faith..." wrote Hong Kong High Court Recorder Linda Chan in judgment grounds released yesterday.
Noble, Asia's largest commodities trader, is seeking damages from Mr Vagner and his Seychelles- based Enlighten Ace on two counts of conspiracy to injure.
Noble had taken issue with three reports published last year on Enlighten Ace's Iceberg website. The judge noted Noble is the only company that has been attacked on Iceberg, which had no track record as an independent stock researcher.
Noble alleged that the reports contained misleading and false information about the company which caused its share price to slump by 24.79 per cent from the date of the first Iceberg report to the date the suit was issued in March last year.
For instance, the second Iceberg report published in February last year said: "Noble overstated fair value gains by US$3.8 billion and they should be impaired." Noble said it had not overstated the fair value gains and there was no need for the gains to be impaired. A third Iceberg report a month later claimed that "as a result of a member of Iceberg acting as whistle-blower in relation to Noble's commercial practices in Singapore, the Singapore Maritime Port Authority (MPA) decided not to renew Noble's bunkering licence".
In fact, Noble said, MPA did not refuse to renew Noble's bunkering licence and released a statement stating Iceberg's claims are untrue.
Mr Vagner, in defence papers filed last year, is denying Noble's claims, arguing among other things that Noble failed to answer almost all the questions raised in the Iceberg reports. He also pointed to "comprehensive research" undertaken by Iceberg between 2010 and 2014.
Noble then applied to the court for further details from the defendants about the matters pleaded in their defence statements. The defendants filed answers to most of the 141 requests sought by Noble except for 28 requests which related to their plea of justification and fair comment. Mr Vagner had argued these 28 items were not "proper requests" or were matters for which he could not give further details until more information was made known by Noble.
Noble argued in court it was not open to the defendants to decline to answer the 28 requests by claiming they are not proper requests or give reasons why they are unable to provide the details requested. The judge disagreed, pointing out it was not valid for Noble to say the defendants "are not entitled to answer the 28 requests in the way they did..."
She noted the defendants had provided answers to a "substantial" number of requests. Other requests involved the supply of evidence from the defendants, among other things, which was not appropriate at this stage of the court process.
"...the defendants have made clear their position on the requests. Where as here, there was a genuine conflict of opinion on the sufficiency of answers, the matter can only be resolved by further adjudication," said Madam Chan. She dismissed Noble's move to strike out Mr Vagner's defence and give judgment for Noble.