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Why iSignthis just commenced Federal Court action against the ASX

It has now been over two months since the iSignthis Limited (ASX: ISX) share price has traded on the Australian share market.

On October 2, following a period of volatility in its share price, the Australian Securities Exchange (ASX) determined that it was appropriate to suspend trading in the shares of iSignthis with immediate effect under Listing Rule 17.3.

The embattled payments company has vented its frustration numerous times about its suspension, but to no avail.

Today it took things to the next level by announcing the commencement of legal proceedings against ASX operator ASX Ltd (ASX: ASX) in the Federal Court of Australia.

Why is iSignthis taking legal action?

According to the release, iSignthis has taken action in order to challenge the decisions made by the ASX to suspend, and not reinstate, the company’s shares for quotation on the exchange.

Management advised that it is seeking orders which require ASX Ltd to lift the suspension and reinstate iSignthis’ shares for quotation on the exchange.

It advised that it is concerned that investors are being denied the opportunity to trade their shares and that the continuing suspension could harm its standing with investors, customers, and suppliers.

iSignthis chairman, Tim Hart, said: “We have taken this step in order to lift the suspension of ISX’s shares. We are acting in the interest of our shareholders, as they have been denied the basic right to trade our shares for too long.”

Chief Executive Officer, John Karantzis, added: “We have answered scores of questions and provided more than 2000 pages of confidential documents dating back almost three years. We have been patient and acted in good faith, but the Company’s shares have been suspended for nine weeks.”

iSignthis believes that the interactions with the ASX during this time raise issue of procedural fairness and good faith, as well as a substantive question about the actual reason for the suspension.

One payments company that is on the move on Thursday is Afterpay Limited (ASX: APT). Its shares have raced higher after revealing stellar sales growth in November and over the Black Friday and Cyber Monday sales period.

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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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