The High Court has ordered discovery of certain communications involving Web Summit Ventures (WSV) in a minority shareholder oppression case concerning Manders Terrace Limited. It refused a separate, broader request for documents about complaints and investment-related actions.
The ruling concerns a discovery application by Graiguearidda Limited, which holds 11.97% of Manders Terrace. It is not a decision on whether oppression occurred or whether the company suffered loss. The court directed that discovery be made in specified categories and listed the case for a further mention to address the timetable and other directions.
The application arose after the pleadings were amended to address posts about Israel made by Patrick Cosgrave on his Twitter account using a platform provided by the company, and similar posts by the Ditch website. The applicant alleged that the conduct affected WSV and the company’s business. The respondents admitted some pleaded matters about investor reactions but denied that Cosgrave’s conduct had directly prejudiced WSV, and disputed whether the posts caused short-term damage.
Justice Eileen Roberts said the impact of the posts on WSV was relevant to assessing alleged loss and damage. She concluded the applicant was entitled to test the respondents’ assertion that there was no loss and to seek information solely within the respondents’ knowledge.
The court ordered discovery of documents recording communications between WSV investors or potential investors, certain start-ups invested in by WSV, and WSV partners, contractors or other stakeholders, on one side, and the respondents or their servants or agents on the other. The documents must relate to Cosgrave’s or the Ditch’s statements about Israel pleaded in the amended claim, and must have been created on or after 7 October 2023. The court narrowed the category from the wording sought, including by limiting it to start-ups invested in by WSV.
It refused category 8A, which sought documents evidencing complaints, boycotts, refunds, investment withdrawals, objections, cancellations, contract terminations, resignations or refusals of investment. The judge considered the communications category sufficient and said category 8A was too broad because it did not require a connection to the posts.
The court also ordered discovery in four categories common to the related Lazvisax proceedings, covering specified communications about the statements, steps to mitigate damage to Web Summit’s business and reputation, Cosgrave’s resignation, and the financial impact on the company. The judgment does not set the discovery deadline. The case was listed for mention on 25 April 2024 to address the timetable, the respondents’ discovery deponents and any further directions or submissions on costs.