In the judgment of 6 February 2019 the Court of Appeal in Warsaw dismissed the appeal against the judgment of the Regional Court in which the court awarded compensation to Exorigo-Upos sp. z o.o. – an IT company represented by JARA DRAPAŁA & PARTNERS – for so called stock exchange damage.
The dispute arose with respect to acquisition of minority shareholding in a listed company in 2010. The damage resulted from non-performance by another shareholder (defendant), who gained the dominant position in the company, of the obligation to announce a tender offer for all other shares and hence buy the minority shareholding held by the claimant.
The Court of Appeal in Warsaw, sharing the position presented by JDP attorneys, pointed out to the precedent aspects of the case. In the case-law, there have been practically no decisions concerning the relationship between the shareholder’s tort and its consequences consisting in a loss suffered by another shareholder, the value of which is calculated on the basis of time-varying parameters (change in stock prices). Also assessment of business decisions made by the shareholder who suffered damage (when to sell shares, what sales strategy to adopt) in the context of the cause-and-effect relationship, predictability of future changes in stock prices and calculation of the damage suffered were important. In the proceedings, an interesting issue emerged, namely potential damage caused to other shareholders who did not participate in the proceedings alongside the claimant.
It is one of the first judgments in Poland regarding remedy for so called stock exchange damage which may be relevant in similar cases in the future. The judgment is final and non-appealable.