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Lewis targets Woollam with fresh claims

4 Oct 2016

The legal battle between Lewis and activist shareholder Dave Woollam appears to have moved back to the Financial Services Board (FSB) where its directorate of market abuse, hours after clearing Woollam of insider trading charges, informed him he was once again under their spotlight.

http://www.bdlive.co.za/business/retail/2016/10/03/lewis-targets-woollam-with-fresh-claims?src=ilaw

In a SENS statement on Friday, Lewis referred to a complaint it had lodged with the FSB against Woollam in July 2015 "for the making and/or publishing of false, misleading or deceptive statements, promises or forecasts, of and regarding it".

This was the same letter that prompted the insider trading investigation.

The statement said the directorate of market abuse had confirmed in a letter dated September 28 that the investigation into these allegations was still ongoing.

The directorate's head, Solly Keetse, said he could not provide information about the latest move on Woollam, but confirmed the FSB had received a complaint of false and misleading reporting that it would probe.

Last Wednesday, the directorate confirmed it had closed its investigation into insider trading by Woollam in Lewis shares. Late on Friday, Woollam was informed of the second investigation.

Lewis' 2015 complaint referred to potentially price-sensitive information Woollam had uncovered in his investigation of Lewis. The complaint suggests Woollam intended using it to benefit his investment in Lewis shares. This was the motivation, said the letter of complaint, for Woollam's engagement with Lewis, and not the protection of consumers.

An unfavourable FSB finding would help Lewis fight the Section 165 notice Woollam lodged with the Cape High Court in June.

The notice requires the board to take legal action against four of its directors - CEO Johan Enslin, chief financial officer Les Davies, board chairman David Nurek and chairman of the audit and risk committee, Hilton Saven.

The board's best hope of winning this legal action is to persuade the court that Woollam is not acting in good faith.

On Friday, Lewis in a SENS statement informed shareholders it was appealing against the National Consumer Tribunal's order last month and would send notice of this to the High Court in Pretoria "imminently".

The tribunal found Lewis had missold insurance and ordered an independent audit of its credit agreements. On Friday, National Consumer Regulator manager of investigations and enforcement Jacqueline Boucher said she could not comment on Lewis' appeal as she had not received it.