Sun. Feb 5th, 2023
    en flag
    nl flag
    et flag
    fi flag
    fr flag
    de flag
    he flag
    ja flag
    lv flag
    pl flag
    pt flag
    es flag
    uk flag

    Content Assessment: Allegations and Denials? Nuix Notes ASIC Enforcement Proceedings

    Information - 88%
    Insight - 87%
    Relevance - 90%
    Objectivity - 86%
    Authority - 86%



    A short percentage-based assessment of the qualitative benefit of the market release from the global software provider, Nuix, regarding ASIC's pursuit of criminal proceedings.

    Editor’s Note: From time to time, ComplexDiscovery highlights publicly available or privately purchasable announcements, content updates, and research from cyber, data, and legal discovery providers, research organizations, and ComplexDiscovery community members. While ComplexDiscovery regularly highlights this information, it does not assume any responsibility for content assertions.

    To submit recommendations for consideration and inclusion in ComplexDiscovery’s cyber, data, and legal discovery-centric service, product, or research announcements, contact us today.

    Investor Update (29 September 2022)

    ASIC Enforcement Proceedings

    Nuix Market Release Overview

    The recent investor news update from Nuix on 29 September 2022, advises that ASIC has commenced civil proceedings in Federal Court against the Company and its directors during the period 18 January 2021 to 21 April 2021. The information in Nuix’s market release may be of interest to legal, business, and information technology professionals operating or investing in the eDiscovery ecosystem.

    According to the market release, ASIC alleges that aspects of the Company’s market disclosure in that period contravened provisions of the Corporations Act and ASIC Act and that the relevant directors breached their duties in respect of that disclosure. In particular, ASIC claims that the Company’s disclosure of its Annualised Contract Value (ACV) and statutory revenue performance as against forecasts was deficient.

    Additionally, ASIC seeks declarations in respect of the alleged contraventions, pecuniary penalties against Nuix and pecuniary penalties and disqualification orders against the relevant directors.

    Per the market release, Nuix has fully cooperated with ASIC during the course of its investigation into these matters.

    Nuix also denies the allegations made against it and the allegations made against the director respondents and intends to defend the proceedings. Given the matter is before the Court, Nuix highlighted that the Company will not be providing commentary in relation to the progress of these proceedings.

    Read the Complete Market Release: ASIC Enforcement Proceedings (PDF) – Mouseover to Scroll

    Nuix Market Release - ASIC Enforcement Proceedings - 092922

    About Nuix

    Nuix Limited is a leading provider of investigative analytics and intelligence software, with the vision of “finding truth in a digital world”. Nuix helps customers to process, normalize, index, enrich and analyze data from a multitude of different sources, solving many of their complex data challenges. The Nuix platform supports a range of use cases, including criminal investigations, financial crime, litigation support, employee and insider investigations, legal eDiscovery, data protection and privacy, and data governance and regulatory compliance.

    For further information, please visit

    Read the original response.

    Background Information (29 September 2022)*

    22-262MR ASIC Sues Nuix and Its Board for Continuous Disclosure and Directors’ Duties Breaches

    ASIC Market Release

    ASIC has commenced proceedings in the Federal Court against Nuix Limited (ASX:NXL) for alleged continuous disclosure breaches and misleading or deceptive conduct. ASIC has also brought proceedings against members of the Nuix board for breaches of their directors’ duties.

    ASIC alleges that Nuix made misleading or deceptive statements when reaffirming its Prospectus financial year 2021 forecasts for statutory revenue and for annualised contract value (ACV) in announcements to the ASX on 26 February 2021 and 8 March 2021.

    ASIC alleges that at the time of these announcements, Nuix was aware that ACV for financial year 2021 was likely to be materially below forecast, which made those announcements misleading and gave rise to the need for corrective disclosure.

    ASIC Chair Joseph Longo said ‘Nuix was a newly listed technology company with a complex business model. This meant investors relied heavily on the company making accurate and timely disclosures regarding its earnings.’

    ASIC also alleges that Nuix breached its continuous disclosure obligations including by failing to:

    • disclose its first half financial year 2021 ACV result from 18 January 2021 until 26 February 2021 when it published its half year results;
    • make corrective disclosure regarding the announcements made to the ASX on 26 February and 8 March 2021, or announce a downgrade;
    • announce a downgrade to its Prospectus forecasts from 13 April 2021 after financial year 2021 ACV and statutory revenue had been reforecast. A downgrade was not announced until 21 April 2021.

    Nuix shares totalling $1.2 billion were traded during the period of the contraventions alleged by ASIC.

    ‘Nuix’s ACV result at the end of the first half showed that, far from growing rapidly at 18.5 per cent as the company had forecast for the full year, Nuix’s underlying business as measured by ACV had essentially shrunk by almost 4 per cent over the first half. It took the company over a month, until 26 February 2021, to disclose this material information to the market. Nuix had an obligation to promptly disclose this information,’ said Mr Longo.

    ASIC further alleges that Nuix’s directors breached their directors’ duties by failing to take reasonable steps to prevent Nuix from making misleading statements and breaching its continuous disclosure obligations. Nuix directors who ASIC alleges breached their duties are Jeffrey Bleich (Chair), Rodney Vawdrey, Susan Thomas, Daniel Phillips and Sir Iain Lobban.

    ASIC is seeking declarations, pecuniary penalties and disqualification orders from the Federal Court.

    ASIC has also concluded its investigation into suspected insider trading in relation to trading in Nuix shares in 2021 and has decided no further action will be taken.



    The initial public offering (IPO) of Nuix was billed as the biggest IPO of 2020 and, at the offer price of $5.31 per share, Nuix had a market capitalisation of $1.7 billion.

    While ACV is not a statutory reporting metric, Nuix’s forecast ACV growth was a feature promoted in its Prospectus. ASIC considers that for a business like Nuix with revenue recognition patterns that may distort statutory revenue, ACV is a significant metric which influences an investor’s assessment of its underlying growth, earning potential and suitability as an investment.

    • ACV assesses the total contract value of a company’s revenue at a point in time on an annualised basis. A comparison between ACV at two points in time provides visibility as to a company’s underlying revenue growth trajectory.

    ASIC has concluded its investigation into statements made in the IPO prospectus and the financial statements of Nuix for the financial periods ended June 2018 to June 2020 and determined no further action will be taken.

    ASIC has also concluded its investigation into Macquarie Capital (Australia) Limited for suspected contravention of s912A of the Corporations Act in relation to the Nuix IPO, determining that no further action will be taken.

    *Shared with permission of ASIC.

    Read the Complete Notice of Filing: Australian Securities and Investment Company v Nuix Limited (PDF) – Mouseover to Scroll

    Federal Court of Australia - Notice of Filing - 092822

    Additional Reading

    Source: ComplexDiscovery


    Have a Request?

    If you have information or offering requests that you would like to ask us about, please let us know and we will make our response to you a priority.

    ComplexDiscovery is an online publication that highlights cyber, data, and legal discovery insight and intelligence ranging from original research to aggregated news for use by cybersecurity, information governance, and eDiscovery professionals. The highly targeted publication seeks to increase the collective understanding of readers regarding cyber, data, and legal discovery information and issues and to provide an objective resource for considering trends, technologies, and services related to electronically stored information.

    ComplexDiscovery OÜ is a technology marketing firm providing strategic planning and tactical execution expertise in support of cyber, data, and legal discovery organizations. Focused primarily on supporting the ComplexDiscovery publication, the company is registered as a private limited company in the European Union country of Estonia, one of the most digitally advanced countries in the world. The company operates virtually worldwide to deliver marketing consulting and services.