The Federal Court this week is due to start hearing allegations of "improper" conduct against industry figure Mark Fishwick, accused of asset stripping an advertising agency, the failed Ambient Rail.
The case centres around how a sales agent contract with the then APN Outdoor, now part of JCDecaux, was moved from one company to another, leaving behind trade debts, but keeping safe from creditos a key asset.
Brad Tonks, a partner at insolvency specialists PKF and the liquidator of Ambient Rail, an outdoor media agency which went into administration almost a decade ago, is going after Fishwick and billboard agency Captive Vision Outdoor, the company which took the contract from Ambient.
Captive Vision is part of Venetian Media Group (VMG), founded by Mark Fishwick and his son Michael.
Proceedings against Alan Conder, shown on LinkedIn as the managing director of Captive Vision Pty Ltd, were dismissed by the Federal Court last week. But he and Lynn Conder must pay their own costs.
Fishwick and Captive Vision Outdoor are defending the long-running action, with costs now running at more than $1 million.
The Federal Court judge, Justice Markovic, in a summary of the case: " ... the plaintiffs claim that the defendants engaged in a scheme whereby the business of Ambient Rail was removed from it in the period prior to its winding up as part of an alleged deliberate strategy to strip it of its assets during and after a dispute between Mr Fishwick and his fellow shareholder, Milan Bozic."
Tonks alleges Fishwick engaged in “improper” conduct, and breached his fiduciary and statutory duties as a company director.
Fishwick, says the liquidator in court filings, was not “acting honestly,” did not act in the best interests of Ambient and “misused his position” as a director.
“Ambient Rail has suffered loss/and or damage as a result of Mr Fishwick’s breach of his duties,” the liquidator told the Federal Court.
Fishwick, who has been a director of other failed advertising companies which ended up in administration, including Ambient Advertising in 2014, is currently listed as the group chairman of Venetian Media Group, launched with his son Michael in 2020 in Melbourne’s South Yarra.
In the NSW Supreme Court in 2016, Fishwick was cross-examined by a court-appointed special liquidator about allegations Ambient Advertising had overcharged clients and the alleged transfer of business between Ambient Advertising and Revolution 360, an ad agency he formed after Ambient Advertising went into administration.
In the current case, being heard in the Federal Court, Fishwick allegedly arranged in 2013 for a NSW Rail contract between Ambient and APN Outdoor, to be placed with a new company.
This essentially left debts in Ambient and the sales agent contract, giving it the right to sell space at NSW Rail sites, moved to a new business, Captive Outdoor.
The liquidator says Captive generated about $16 million revenue 2014-2018.
Documents lodged with the Federal Court allege that Andrew Hines, currently chief operating officer at JCDecaux and then at APN Outdoor, was asked to transfer the NSW Rail contract and that of Metro Trains Melbourne (MTM).
Damian Potter, the current commercial director at JCDecaux and then at APN Outdoor, was also involved in the new contract, according to 2013 emails quoted by the liquidator.
From December 2014, APN Outdoor inked new sales agent contracts for the NSW Rail and MTM licences with Captive Vision, with terms substantially similar to that given to Ambient.
The liquidator maintains that Captive Vision essentially was the same business as Ambient.
And around the same time, Captive added a sales agent agreement with APN Outdoor for the Public Transport Authority of Western Australia.
The case is a long running one. Tonks, and colleague John Vouris, were appointed by Fishwick as administrators of Ambient Rail on April 4, 2014.
To fund the current case, Tonks in August 2019 entered into a litigation funding deed with Premier Litigation Funding.
An annual administration return for Ambient Rail lodged by Tonks in September 2020 with corporate regulator ASIC shows creditors were owed $803,183.78 but that cash at bank was just $6,943.40.
Defending the case has already cost more than $1 million, according to Justice Markovic in a ruling ordering the liquidator to lodge surety with the court to pay the costs of Fishwick if the case went against Tonks.
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