ASX shareholder seeks court leave to sue former directors

Rosherville Pty Ltd has notified the Australian Securities Exchange that it plans to apply to the Federal Court for leave to bring a statutory derivative action under sections 236 and 237 of the Corporations Act. If the court grants leave, Rosherville would be allowed to bring the proceedings on behalf of ASX.

ASX acknowledged receipt of the notice and said there are no allegations against the exchange itself. The company did not identify which former officers or directors are targeted, specify the alleged breaches or list the remedies Rosherville intends to seek. The Federal Court has not yet decided whether the proposed action may proceed.

The potential litigation relates to ASX’s long-running effort to replace its Clearing House Electronic Subregister System, known as CHESS. ASX began exploring a replacement in 2016 and selected a distributed-ledger system developed with Digital Asset. The exchange first flagged blockchain for the project in 2017, but the planned launch was repeatedly delayed.

In November 2022 ASX paused the project after an independent review found significant design problems and doubts about the system’s ability to meet ASX requirements. In May 2023 ASX abandoned the blockchain approach and said it would consider conventional technology for the replacement.

Regulatory action followed. The Australian Securities and Investments Commission sued ASX in August 2024, alleging the exchange lacked a reasonable basis for telling the market in February 2022 that the project was “progressing well” and on track for an April 2023 launch. ASIC characterized the episode as a collective failure by ASX’s board and senior executives.

In June 2026 ASX admitted to engaging in misleading conduct related to the blockchain replacement. On July 3 the Federal Court ordered ASX to pay a $14.4 million penalty and $2.1 million for ASIC’s costs, resolving the regulator’s case weeks before Rosherville notified the exchange of its proposed derivative action.

If the court grants leave, Rosherville’s filing is expected to identify the individuals it intends to sue and set out the legal claims and remedies sought. The timing and scope of any proceedings will depend on the Federal Court’s decision.