THE FAMILY of Seán Quinn are preparing to take legal action against Anglo Irish Bank seeking damages relating to events over the past two years that led to them losing control of the Quinn group of businesses earlier this month.
It is understood Mr Quinn’s children are planning to issue High Court proceedings in the coming days. The children – Seán jnr, Brenda, Aoife, Colette and Ciara - are equal shareholders in Quinn Group (ROI), the parent company for the various manufacturing, financial services and leisure businesses that were owned by the family but are now set to be taken over by Anglo and the lenders to the group.
As such, any action has to be taken in their names. All of the Quinn children with the exception of Ciara work in businesses in the group.
The bank appointed a receiver over the company’s shares in Quinn Group (ROI) earlier this month, taking control of the business with banks and bondholders, who are owed €1.28 billion by the group.
Mr Quinn is not involved in the action directly as he was not a shareholder in the business when it ran into difficulty with Anglo and the Financial Regulator. The family would not comment yesterday.
The action is expected to be taken in the Commercial Court in Dublin, which fast-tracks legal actions involving major business disputes.
The case is to look at the validity of Anglo’s decision to lend the family €2.3 billion to buy shares in the bank, which is owned by the State. The family owe Anglo €2.88 billion.
The action will also focus on the legality of the share charges dating back to 2008, which have been used by Anglo’s new management team to effectively take control of the Quinn business empire. The bank was given a charge over the ownership of the group to cover losses on Mr Quinn’s investment in Anglo arising from the bank’s collapsing share price during the financial crisis of 2008.
Further legal proceedings under consideration by the family include a possible challenge to the validity of the regulator’s decision in March 2010 to seek the appointment of joint administrators to Quinn Insurance Ltd (QIL). It is not clear if the Quinn children will also take an action against the Financial Regulator-Central Bank, but this is being considered by the family’s legal team.
The family may seek to injunct the sale of QIL to Liberty Mutual and Anglo, which was signed on Thursday. Mr Quinn has previously warned the family would not be able to repay Anglo without the insurer.
