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Pegasus Racing boss sued for alleged Corporations offences

By:
Jane Aubrey
Published:
August 22, 2012, 3:06 BST,
Updated:
August 23, 2012, 1:36 BST
Edition:
First Edition Cycling News, Wednesday, August 22, 2012

Former business partner lodges claim in Brisbane Supreme Court

A civil action has been lodged in the Brisbane Supreme Court against Chris White and Pegasus Racing, the holding company behind the V Australia team. Cyclingnews learned of the development through freedom of information.

Pegasus wound up its operation of UCI Continental team V Australia at the end 2011 after the airline pulled out of its sponsorship arrangement, and negotiated a confidential payout to White as managing director and CEO of the team.

Brett Roland set up Pegasus Racing with White in 2008 and holds a 34 percent stake in the company. Roland was listed as a company director until he resigned in August 2010 over the matters which are now before the court. Roland, as a shareholder, is suing White on behalf of himself and Pegasus Racing under Section 236 of the Commonwealth Corporations Act, alleging that White has breached the obligation to use his powers and duties as an officer of Pegasus Racing in that:

  • He has failed to act in good faith and in the best interests of the corporation; and / or
  • He has not acted for a proper purpose and has instead preferred his own interests to that of Roland or Pegasus Racing.

When the business was set up, it was Roland's understanding that he and White would have equal partnership in Pegasus Racing. White's role was to prepare all the books and records, and financial material as he was a certified practising accountant.

By January 2010, with Roland still a shareholder and director, White appointed himself CEO and began making managerial decisions without his business partner’s knowledge. Later in the year, White moved intellectual property, assets and sponsorship under the banner of Pegasus Sports at the time of the application to the UCI regarding the team gaining a ProTour licence for 2011. White registered Pegasus Sports with the Australian Securities & Investments Commission which all riders, director sportifs, medical staff, mechanics and team bus driver's would be contracted to should the bid to join cycling's top tier or a ProContinental licence be successful.

Roland claims that White has made profits at the expense of Pegasus Racing and is required to account for such profits. Damages are also being sought.

White has until September 14 to respond to the allegations.

Cyclingnews has contacted both parties but neither offered comment.

 

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legal case