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Funder moves to file class action against CBL

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Australian litigation funder IMF Bentham has filed an application in the High Court in Auckland to commence a shareholder class action against failed New Zealand insurer CBL Corporation.

The lawsuit will allege the parent company of CBL Insurance breached its obligations to keep investors “properly informed” about its French insurance business.

CBL Insurance, which went into liquidation a year ago, was involved in the underwriting of French construction insurance.

“We have continued to receive strong interest in the IMF-funded action from both retail and institutional investors in New Zealand and abroad,” IMF Bentham Investment Manager Ewen McNee said.

“We have signed up a significant number of shareholders who together purchased tens of millions of shares in CBL and whose investment has been lost due to the company’s alleged misconduct.”

The class action is one of two that CBL faces. New Zealand’s LPF Group is funding the other legal action against the company’s former directors.