Can Rinehart’s Billion-Dollar Court Battle Be Won? The Verdict Is In, And It’s Not Looking Good For The Mining Tycoon

Must Read

In a legal dispute over multiple billions of dollars in iron ore royalties from Rio Tinto-operated mines, Hancock Prospecting, owned by Gina Rinehart, has regrettably lost this round to Wright Prospecting.

On Wednesday, the courts issued a judgement that will finally initiate an eagerly awaited trial in 2021 regarding the high royalties generated from the Hope Downs mine situated in Pilbara.

This ruling is the latest twist in a legal battle between Hancock and its rival Wright Prospecting, owned by the family of late investor Paul Blackburn, who was Mrs Rinehart’s former business partner.

Paul Blackburn bequeathed his share of royalties to his seven children on his deathbed. However, this endowment was rejected by Gina Rinehart and her company Hancock Prospecting, who claimed that Blackburn’s children acted in bad faith by denying the very assets of their deceased father.

According to the report, the decision delivered on Wednesday could force Hancock to pay back more than $1 billion to Wright Prospecting.

This dispute is one of the most extensive and complicated involving family members on a single inheritance in Australia. And in it, the courts have been unable to appoint an independent trustee for several years. This has prevented the broker from selling Wright’s share of royalties and using that money to pay its lawyers’ bills.

“One of the things that this judgment shows is how hard it is to dissolve a company, even when there are no disputes between shareholders,” said John Atanassoff, partner at Ashurst.

“The parties have been sitting around for years until this judgment was made,” he said.

In June last year, the courts appointed a receiver to Wright Prospecting and its subsidiary companies after Hancock sued them for fraudulently concealing assets from a previous court case in 2004. The asset value was estimated at $290 million.

Rinehart brought the case based on the allegation that Wright Prospecting and its subsidiaries had fraudulently misrepresented assets worth hundreds of millions to avoid paying higher royalties. She accused them of adapting a company structure that resulted in smaller profits being paid out as dividends.

However, Wright’s lawyers suspended this ruling until Wednesday’s call. And the central claim in this new ruling was that Rinehart had a net benefit of $530 million from her business dealings with Wright Prospecting and its subsidiaries between 2007 and 2010.

- Advertisement -spot_img
Latest News
- Advertisement -spot_img

More Articles Like This

- Advertisement -spot_img