ASIC gives up on One.Tel appeal

The Australian Securities and Investment Commission (ASIC) has given up on its appeal against a verdict by the NSW Supreme Court dismissing its claims against the founder of One.Tel, Jodee Rich, and finance director, Mark Silbermann, in a long running court battle.

In a statement, ASIC said it has "decided that it is not in the public interest to pursue an appeal".

"Public interest considerations, cost and effluxion of time were key factors in deciding not to appeal," ASIC chairman Tony D'Alosio said in the statement.

"We have reached the view that the Judge’s decision turns on questions of fact and that there are no important points of law which should be reviewed on appeal. Further, the case concerns conduct which occurred in 2001. A successful appeal would most likely result in a retrial causing a further significant delay to the final resolution of the matter."

In December last year ASIC said it would appeal the verdict and had until 27 February to commence the appeal. However, the latest decision brings the case to a close.

In mid-November 2009 ASIC lost the landmark case against the founder of One.Tel, which collapsed in late 2001 owing companies led by the Murdoch and Packer families about $1 billion.

In handing down the verdict, Justice Austin found ASIC's case had a "superficial appeal, but time and again they were shown to be unpersuasive when the underlying financial detail was investigated".

ASIC had alleged Rich and Silbermann had failed to meet their duty of care in the months leading up to the company's collapse in May 2001.

The duo escaped a corporate ban and compensation payments to creditors of about $92 million.

Justice Robert Austin also said the telco would likely have survived if a proposed $132 million rights issue had been able to go ahead.