The emergence of the collapsed Italian dairy group Parmalat from bankruptcy proceedings in Italy, with the formation of a new company taking over from the old Parmalat, has opened the way for a new class action by Parmalat shareholders who lost billions when the company collapsed.
Lawyers leading a securities class action against Parmalat have filed a fresh motion seeking permission to amend their complaint to assert claims against Parmalat S.p.A., the company that recently emerged from Extraordinary Administration Proceedings in Italy against the collapsed dairy company.
Until recently, the class plaintiffs were prevented from filing claims against Parmalat Finanziaria and its subsidiaries and affiliates because of a stay issued in the Italian bankruptcy proceedings against all creditors, including class plaintiffs, and also a preliminary injunction issued by the US bankruptcy court against all creditors and class plaintiffs.
However, the new complaint will allow Parmalat investors who lost billions of dollars when the Italian dairy giant collapsed in a fraud scandal three years ago to seek claims against the company itself.
According to the shareholders’ lawyers, because of a ruling by an Italian court in 2005 causing Parmalat S.p.A. to succeed Old Parmalat and triggering the transfer of Old Parmalat’s assets and liabilities to the new company, Parmalat S.p.A.did not get a “fresh start” with its pre-petition debts being discharged.
The amended complaint was filed in US District Court for the Southern District of New York.
“Our new filing is an important milestone in this case,” said Stuart Grant, partner at Grant & Eisenhofer which is representing the Parmalat shareholders. “For the first time since the rapid implosion of Parmalat nearly three years ago, investors have the opportunity and the right to seek compensation from the company itself, an option that was not available while Parmalat was in bankruptcy proceedings in Italy.”