Thursday, 30 May 2019

Pet hate - "vigorously defend" the proceedings.


Why do companies always say that they are intending to vigorously defend proceedings when they get taken to court by a regulator? Firstly, what exactly is the word "vigorously" intended to add to the description of the company's intent to fight the case? Is it used to distinguish the company's defence strategy from other possible litigation strategies such as an intention to "lethargically", "feebly" or even "apathetically" defend the proceedings? Secondly, what sort of message does the statement by a company that it will be "vigorously defending the proceedings" send to its shareholders. Do shareholders interpret such as statement as meaning that the company is confident that the regulator is entirely mistaken about the alleged contravention and that by stating that they will be vigorously defending the case, the regulator will simply skulk away with its tail between its legs? Or does such a statement suggest to shareholders that management have stuffed up, exposed the company to significant regulatory penalties and are now proposing to burn hundreds of thousands of shareholder funds fighting a case which everybody knows the company will most likely be trying to settle in 12 to 18 months time anyway?

https://www.smh.com.au/business/banking-and-finance/apra-seeks-to-disqualify-five-ioof-directors-executives-20181207-p50ksf.html

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