Prosecution calls to send peaceful environmentalist to the Supreme Court

Today (Tuesday) Jonathan Moylan appeared in court for his second mention under Section 1041E of the Corporations Act pertaining to the making of false or misleading statements.

In January this year, Mr Moylan sent a press release on ANZ letterhead to the ASX stating that the bank will withdraw financial support from Whitehaven’s Maules Creek open cut coal mine on ethical grounds.

The prosecution have indicated they will be applying to move the matter to the Supreme Court.

Moylan’s solicitor, John Sutton condemned the proposed move to a jurisdiction normally reserved for murderers and the worst criminals in our society saying,”The prosecution of Jonathan in the highest jurisdiction in this State when there is no good moral, ethical or justifiable reason to do so is not about justice, it is an exercise of might over right.”

The Laird family, whose farm is set to be impacted by the proposed mine, are vocal supporters, with Phil Laird travelling over 500 kilometres to stand with Jonathan today.

Mr Laird said “The project will clear 1800 hectares, and our communities and livelihood will be destroyed if this mine goes ahead. Jonathans peaceful action shone a light on this project, yet he is being pursued to the highest court in this state, reserved for the most serious crimes. Meanwhile Whitehaven are themselves being investigated for false and misleading statements and subject to a Federal Court challenge – where is the justice?”

The contested Whitehaven project continues to flounder, with mounting opposition from traditional owners, and the local community. The proposed coal mine has been dogged by delays amidst a declining coal market and posted a loss of $82 million in the 2012/13 financial year. The Federal court challenge is due to be heard from the 16th-19th September and casts further uncertainty over this project.

Spokesperson for the ‘We Stand with Jonathan Moylan campaign’, Nicola Paris said, “Jonathan is the first individual to be charged under this section of the Corporations Act which was never intended to pursue people acting in good conscience.The move to take this matter to the Supreme Court is yet another over reach in this relentless pursuit of a young man acting on principle. This lies in stark contrast with the failure of ASIC to prosecute serious corporate crime whilst people found guilty of insider trading such as John Gay, get a slap on the wrist”, she concluded.*

Jonathan’s next court appearance is on the 24th September 2013.

BACKGROUND

The Maules Creek and Boggabri Coal projects

The Maules Creek Coal and Boggabri Coal projects are located near Narrabri in north-west NSW.
The Whitehaven Maules Ck mine is a new greenfield open-cut project that will extract 13 million tonnes per annum of coal and clear approximately 2,000 hectares of land (2,000 rugby fields). Nathan Tinkler sold his stake in the project earlier this year.
The Idemitsu Boggabri mine is an expansion to a current open-cut mine to extract 7 million tonnes per annum of coal which will clear approximately 1,535 hectares of land.

Approval Process Investigations and legal challenge

On the 6th February 2013, the Federal Environment Minister extended the deadline for a Federal decision on the mines to 30th April 2013.

However, on the 11th February 2013 the Minister back-flipped, approving the projects in a rush after a letter from him to the NSW Government was leaked to the media.

On the 6th July 2013, Whitehaven claimed to have all final approvals needed to commence construction of the mine.

The two mines are now subject to a Federal investigation as to whether they used false and misleading information to obtain approval[1]. This information relates to biodiversity offsets that were critical in the approval.[2] Providing false and misleading information on this issue to Government and the market would have the potential to mislead investors and the market as to the viability of the project.

In July, community group the Northern Inland Council for the Environment commenced legal action in the Federal Court to overturn approval of the Maules Creek and Boggabri mines. Phil Spark of NICE said, “We are challenging the approval because of the dodgy process by which these mines were approved and the devastating impacts they will have. The approvals were made in haste, after documents were leaked and on the basis of potentially false or misleading information”.

Former owner of the Maules Ck coal mine, Tinkler company Aston Coal, is currently being prosecuted for failure to disclose reportable political donations.

Community Opposition

There has been concerted community opposition to the two mines since 2010 from all the key sectors of the community including farmers, Traditional Owners and environmentalists.

In July Gomeroi elders walked off the job conducting cultural heritage surveys for Whitehaven Coal in protest at the Maules Ck coal mine. There are ongoing negotiations with Whitehaven and many elders remain firmly opposed to the project proceeding.

Context to ASIC prosecution of Jonathan Moylan

This case against Jonathan Moylan is the first time an individual has been prosecuted under s1041E of the Corporations Act.

ASIC is currently subject to a Senate Inquiry investigating its inaction in relation to prosecuting major corporate white-collar crime.

Last week, former Gunns chairman John Gay, who was prosecuted by ASIC for insider trading, received a $50,000 fine for an offence which carries a maximum penalty of $220,000 or 5 years’ jail. While ASIC praised the result, the Shareholders Association slammed the fine as “too lenient”, saying Gay “clearly profited at the expense of shareholders”, and that “where a director has pleaded guilty to insider trading we would have thought that there would have been the potential for a jail term…”.

Moylan acted on a matter of principle for no personal gain. The impact of Moylan’s action on shareholders has been exaggerated and should be seen in context. An investor who held $10,000 in Whitehaven shares and sold at the low point on the day of Moylan’s action you would have lost $881 (shares fell from $3.52 to a low of $3.21 before recovering). Had the investor not acted and held their shares, at today’s share price of $2.01 the investment would be worth just $5710.41, a drop of some 43%.

Cumulative Environmental Impacts

The mines will clear the largest remnant of bushland left on the Liverpool Plains, Leard State Forest, which is part of a national biodiversity hotspot.

The mines will impact on habitat for up to 396 plant and animal species and as many as 23 threatened species.

It is estimated that the mines will lead to a 5-7m drop in the water table and up to 18,000 tonnes of dust being dropped on surrounding farms each year.

Total greenhouse gas emissions from the coal produced will, when burnt, exceed 60 Mt/yr of CO2 equivalent – a total greenhouse impact greater than that of 165 individual nations, including Sweden, Hungary and Finland.

This is the context in which the Maules Ck coal mine was the subject of a media release by Jonathan Moylan which has now led to his prosecution by ASIC.

[1] Investigation acknowledged by SEWPaC in answers to Senate Estimates questions, see page 76 http://www.aph.gov.au/Parliamentary_Business/Hansard/Estimates_Transcript_Schedule
2 http://nccnsw.org.au/media/whitehaven-coal%E2%80%99s-deceptive-practices-revealed
[2] http://nccnsw.org.au/media/whitehaven-coal%E2%80%99s-deceptive-practices-revealed