Mariscal & Abogados Files Lawsuit In Canaries Against Blue Explorers for Allegedly Misleading Shareholders

Madrid 16th of July 2019
In March 2017, the parties agreed they would combine the Shareholders’ investment, knowledge, skills and experience in resort operations, marketing, business growth and dive center operations owned the Defendant in the Canary Islands (allegedly valued at €500,000) to build the largest specialist diving resort operator called Blue Explorers Resorts, the first one opened in May of 2018 on Gran Canaria.

In December 2018 the Shareholders called in international law firm Mariscal & Abogados based in Madrid, after they became concerned about the Company, its officers and advisors, possible violations of the Spanish Companies Act and following one of several failed attempts to raise the capital of the new operating company.

According to the case filed, throughout the period before and after the funds were invested, the Defendants made claims around the alleged value of the Company, touting positive financial results and affirming its control over financial reporting. It was also stated that all investments made into the new company would be in the liability of the new operating company at the date of signing the Shareholder Agreement. This assertion was not proven as the money, according the accounts, had never been put into the new company and had the Shareholders known this they would never have invested or signed the agreement. Given it was the core obligation of the agreement to increase the new operating company’s capital increase, when it was legally impossible to carry out.

The claim also states that, despite repeated requests to the Company for its financial statements and information, these requests went unanswered by the Company’s officers, accountants and legal advisors. At this point the Shareholders (who were at the time Board Members) formally requested a board meeting.

The meeting was held on the 30th of March and the Shareholder/Directors were only given access to some of the Company’s records the afternoon before, but what was uncovered has led to the claim filed. The accounts show no trace of the majority of the Shareholder funds, which were provided in 2017 and other Shareholder funds had been recoded as loans, which were never agreed to. Nor was there an independent valuation report on the true value of the Defendants dive business Blue Explorers, which upon discovery, no accounts have been filed for 3 years.

When they finally did file the 2017 accounts in May 2019, they showed a net value of €80,000. (there are still no public accounts for 16, or 18). Shareholders/Directors refused to accept these accounts and moved to call a Shareholders meeting on the 25th of April, 2019 and as the Defendants could not provide the accounts showing the Shareholder funds, nor could they provide an independent valuation, no raise of capital took place.

The claim asks the court to invalidate the Shareholder Agreement signed due to failure of the Company’s legal requirement to raise the capital of the Company and failure to transfer the shareholder investment into the new operating company. They seek € of €475,761 for their return of their investment and costs and there could be awards up €142,728 up to 30% of the claim for legal costs and legal interest.

Should the Plaintiffs claim be successful at trial, the consequences would leave the company insolvent, with potential closure of the resort in Gran Canaria and Dive Centre in Tenerife, with 30 people out work and 1000s of European holidaymakers and their families and divers without a holiday.

Legal counsel for the plaintiff commented. “ We look forward to learning more about the manner in which the investment was elicited from the Shareholders; how the raise of capital was intended to work without the required legal documentation; and in which entity it had been accounted for in, as it seems to the Shareholders are left holding nothing but “blue sky.”

The Shareholders are in the process of filing a formal complaint to the Las Palmas Bar Association on the conduct of the Company’s legal representatives who acted for all parties in the transaction and failed to inform the clients that a sibling was representing an officer of the company personally whilst he and his brother represented the Company in this same matter (not permitted under Code of Conduct of the Spanish Bar)

Dolphin Sqaure
London
SW1V3NT

Blue Explorers Resorts was created to dive the trend in Dive Tourism and the company vision to create the largest dive operator brand in Europe

This release was published on openPR.