ASX to oppose legal action over failed project
- ASX will oppose legal action brought by a shareholder over the failed CHESS replacement project.
- The company faces a statutory derivative action seeking to sue former directors on its behalf.
- ASX determined that the shareholder's legal proceedings are not in the best interests of the company.
Market operator ASX (ASX:ASX) announced it will oppose legal proceedings filed by shareholder Rosherville over the failed CHESS clearing system project.
The legal challenge follows a history of delays and eventual cancellation of the multi-million dollar technology upgrade that was meant to modernise Australia's stock market clearing system.
Rosherville filed two applications to commence a statutory derivative action to sue former directors and officers in the Federal Court for alleged breaches of duties, though no allegations were made against the company itself.
The exchange operator stated that pursuing the legal action against its former executives would not serve the best interests of the business or its investors.
Following the announcement, the ASX share price was unchanged at $61.08.
The exchange operator previously wrote off $250 million in late 2022 after pausing the decade-long CHESS replacement initiative following an independent review that uncovered severe architectural flaws.
The company is currently developing a revised settlement framework while managing regulatory scrutiny and ongoing governance reforms related to the legacy technology failure.
