OANDO and SEC Legal Battle Continues as OANDO Appeals Court Ruling


Friday, February 26, 2021 / 08:39 AM / News / Header Image Credit: Financial Reporter

Proshare Nigeria Pvt. Ltd.

On Thursday, February 25, 2021 in a ruling presided over by Justice Giwa Ogunbanjo at the Federal High Court, Abuja, the judge declined jurisdiction to hear suits brought by Oando PLC and its directors against the Securities and Exchange Commission (SEC). The judge stated that the Investment and Securities Tribunal (IST) would be the appropriate forum to hear the matter.


The basis for the Court's decision is Section 36(2) of the Constitution which allows aggrieved individuals to first approach any tribunal or administrative agency to determine civil rights and obligations as long as that process and the resulting decision is not final. The Court also reiterated that the IST has primary jurisdiction over Oando and its directors in respect of capital market issues and not the Federal High Court.


In July 2017 it came to public attention that the SEC was investigating Oando PLC; a long drawn-out investigation followed culminating in the notorious May 31, 2019 letter from SEC to Oando finding them guilty of a number of infractions and imposing stiff sanctions. 


In response Oando and some of its directors, filed suits against the regulator for not following due process and a breach of their human rights to fair hearing.  In addition to filing suits against the regulator, Oando took out and was granted by the Federal High Court of Lagos an injunction restraining the SEC from executing any of the sanctions in its May 31, 2019 letter.


An Oando official has explained that as much as they respect the decision of the court, the battle is far from over as in their opinion, this is still very much a case for the judiciary and thus Oando has lodged an appeal with the courts in Abuja, contesting the court's decision that the suits are best heard by the IST.  The belief being that justice will only be served through the courts and not the IST as advised by the presiding judge. 


The company and its affected directors argue that the powers conferred by the Constitution of the Federal Republic of Nigeria on its citizens to enforce their fundamental rights supersedes the provisions of the Investment and Securities Act 2007. 


They have also filed an application for stay of execution as well as an injunction pending appeal on the SEC's May 31, 2019 letter to the Company, and as such the status quo that existed before today's ruling remains unchanged meaning nearly 2 years on SEC's hands are tied and they are still unable to implement sanctions imposed on the company or its directors.  It begs the question at what point does the regulator decide to address this challenge in an alternative and more productive manner.


But Thursday's ruling and Oando's appeal is only the tip of the iceberg, 2021 has kicked off with shareholders weighing into this long drawn-out battle.  The shareholders have called on the SEC and Oando to settle the matter out of court, as the tussle continues to impact their investments. Some shareholders have gone as far as dragging both parties to court to seek an end to this impasse.


This month, various factions of Oando's shareholders filed a case against the SEC in the persons of Alhaji Yakubu Gumel; Alhaji Kabiru Tambari, suing for himself and on behalf of the Sokoto Zone Shareholders Association; Tunde Badmus, suing for himself and for the benefits of Pacesetters Shareholders Association, at the Federal High Court Kano.


The shareholders filed for an interim order restraining SEC its agents or representatives from acting on its May 31, 2019 letter sanctioning the Management of Oando.  The orders were granted on Friday, February 19, 2021 and present in court were lawyers for both SEC and the shareholders. The order restrains the SEC, its agents or anyone acting on behalf of the commission from disturbing or meddling with the affairs, management and activities of Oando PLC. It also restrains the SEC's purported interim Management from meddling in the administration and activities of the company as well as an order restraining SEC from interfering with the shareholder's exercise and performance of their statutory powers and duties as shareholders.


Alhaji Tambari Kabiru, one of the applicants, an Oando shareholder since 1991 explained why he decided to sue the apex regulator. He said "I'm not happy with the current state of my investment. I invested my money heavily with the hopes of capital appreciation and this has not been the case. This SEC and Oando case is affecting the value of our investment, it isn't appreciating, instead it gets worse each year. For over two years now we have been totally in the dark on our investment in Oando. Where in the world is this done? Oando's shares would have appreciated greatly if this issue wasn't hovering over our heads. Year on year, our investment has depreciated in value. We are tired! As a shareholder I am strongly behind the Management of Oando. Not everyone can withstand the backlash this crisis has put the Management through these past four years and still remain committed to doing the job. We have reached out to the SEC and appealed for a resolution, but they haven't listened to us, that's why we've taken this matter to court."


The court hearing between the SEC and aggrieved shareholders in Kano has been adjourned to March 17, where it is hoped a favorable ruling will be delivered by the court.


Amidst all of this was good news for one shareholder.  On Tuesday, February 23, 2021 there was a court ruling in favor of an Oando shareholder Engr. Patrick Ajidua. He had challenged the regulator in a suit filed at the High Court of the FCT. He had challenged the SECs right to prevent the convening of an Annual General Meeting as a breach of his right to freedom of association.


In a hearing presided by Honorable Justice O. A Musa, all cases filed were granted in favor of Engr. Patrick.  In summary the judge declared that the May 31, 2019 letter of SEC to Oando sanctioning its management, as unconstitutional, null and void and violation of Engr. Patrick's fundamental right to fair hearing and his human right to receive information on the affairs of Oando and his interest and shares in Oando and more importantly instituted that within 90 days of the ruling Oando must convene an AGM for her shareholders.


The Securities and Exchange Commission (SEC) has denied the claim by Engr Patrick Ajudua, that he won a court case against the capital market apex regulator.  SEC disclosed in a statement it issued on Wednesday, February 24, 2021 that there was never a time it was served with court processes with respect to the purported matter at the FCT High court.


It stated, "The attention of the Securities and Exchange Commission (the Commission) has been drawn to several publications in the media, where it is reported that a shareholder of Oando PLC, purportedly obtained a judgment from the Federal Capital Territory High Court against the Commission.  The Commission wishes to inform the general public that it was never at any time served with court processes with respect to the purported matter at the FCT High court. The Commission will consequently take all necessary steps to verify and set aside the purported decision of the said Court."


This denial is a clear affront to the Nigerian judiciary, implying that Honorable Justice O. A Musa who presided over the case made a judgement without giving SEC the opportunity to defend itself.  This is contrary to court documents that have been sighted which indicate that SEC was served processes but did not appear in court.  Once again it seems the regulator is indifferent to shareholder investments or the sentiments of the capital market and will doggedly continue to fight Oando PLC.

Proshare Nigeria Pvt. Ltd. 

Related Reports

1.   Memo to The Market: The Oando Corporate Journey - At The Regulators Gate - Dec 10, 2017

2.  Download Full (PDF) Report - Memo to The Market: The Oando Corporate Journey - At The Regulators Gate - Dec 10, 2017

3.  Download (PDF) Report - SEC Technical Committee on Oando Plc 2017 -Dec 04, 2017

4.  Review of the SEC Technical Committee Recommendations, Opinion and Final Report

Proshare Nigeria Pvt. Ltd. 

Related News on Oando

1.       OANDO Share Price up 10% off Positive Court Ruling as SEC Reacts to the Court Judgement

2.      Engr Ajudua Secures Judgement as Court Stops SEC from Infringing on OANDO Shareholders Rights

3.      Oando Foundation Commemorates 10 Years of Bridging the Gap in Basic Education

4.      Oando Foundation Initiates Project to Promote Environmental Education and Responsibility

5.      OANDO Notifies of Delay in the Publication of its Q3 2020 Financials

6.      Oando's Nigeria at 60 Digital Platform Showcases Indigenous Talent and Instils National Pride

7.      Oando Joins Business Leaders to Pledge Support For Multilateralism as The United Nations Turns 75

8.     Oando Hosts Webinar on Revolution Based Change to Achieve Inclusive Growth

9.      OANDO Announces Delay in Filing Audited 2019 and Q1 2020 Unaudited Financial Statements

10.  Oando and IoD Host Webinar on Leadership Strategies for Navigating the Impact of COVID-19

11.   Oando, Aiteo, Seplat and Others Collaborate To Fight COVID-19

12.  Oando Becomes First Oil and Gas Company in Nigeria to be ISO 27001 Certified

13.  Oando Plc Announces the Successful Signing of Two Gas Supply Agreements with NLNG

14.  International Volunteer Day - Oando Foundation Refurbishes Early Childcare Classes

15.  Oando PLC Announces YTD September 2019 Results, Posts N13.1bn Profit-After-Tax

16.  OANDO Declares N13.06bn PAT in Q3 2019 Results (SP:N3.40k)

17.   NSE Reclassifies Oando Plc As Low Priced Stock

18.  NNPC, NAOC and OANDO JV Makes Gas and Condensates Discovery

19.  Oando Reaffirms Commitment to Support the Development of Sao Tome and Principe

20. OANDO, MORISON And 82 Others Record Drop In Share Price In Ten Years

21.  Oando Plc Appoints Dr Alex Irune As An Executive Director; Mobolaji Osunsanya Resigns

22. OANDO Declares N7.17bn PAT in Q2 2019 Results,(SP:N3.95k)

23. Federal High Court Adjourns SEC Vs Oando Case to July 22

24. Deloitte Issues Press Statement on OANDO Forensic Audit

25. Oando PLC Responds to SEC's Statement Regarding Fair Hearing in the Investigation of the Company

26. Two Weeks After: OANDO Shares Dropped By -7.14%, -22% YTD

27.  FHC Lagos Adjourns Hearing Between Oando Plc's GCE and Deputy GCE and SEC

28. Oando PLC's Official Response To SEC's Suspension Of Its 42nd AGM

29. SEC Suspends OANDO's Prior Approved AGM Scheduled To hold on June 11, 2019

30. Oando Update: SEC Aligns Principle Of Fair Hearing With Cooperation During Investigations

31.  One Week After: OANDO Shares Dropped By -4.76% WoW, -20% YTD

32. Chief Sena Anthony and Mr. Oghogho Akpata Resign From OANDO's Board Effective June 3rd, 2019

33. Oando Share Price Drops 20% Off The Back Of SEC Investor Protection Moves

34. OANDO Declares N4.63bn PAT in Q1'19 Results (SP:N4.85k)SEC Appoints Interim Management Team For Oando Plc Headed By Mr. Mutiu Olaniyi Adio Sunmonu

35. Post-Forensic Exchanges: The SEC Letter to Oando Plc and The Oando Rebuttal

36. Oando Challenges SEC's Ruling On The Outcome Of The Forensic Audit Into Oando PLC

37.  SEC Announces Far Reaching Decisions On The Investigation Of Oando Plc

38. Oando Optimises Value From Midstream Business

39. OANDO Declares N4.63bn PAT in Q1'19 Results (SP:N4.85k)

40. Oando PLC Announces Divestment of its Residual 25% Interest in Axxela Limited

41.  Oando's Plan to Deleverage and Remain Profitable

42. Oando Plc Announces FYE 2018 Results, Posts N28.8 Billion Profit-After-Tax

43. OANDO Declares N28.79bn PAT in 2018 Audited Results (SP:N5.65k)

44. Oando PLC Announces YTD September 2017 Results; Gives Operational Highlights

45. Oando Plc state Positions on the Securities and Exchange Commission Alleged Findings

46. Oando Secures Court Injunction, restraining SEC, NSE

47.  Oando Shares Now Available for Trading, No Price Movement During Technical Suspension

48. JSE Follows NSE, Suspends Trading in the Shares of Oando Plc

49. Oando Gives Holding Response on SEC's Directive to NSE to Suspend Trading of Its Shares

50. Oando PLC's Official Statement on the SEC's Directive to The NSE to Suspend Trading of Its Shares

51.  NSE, SEC Confirm Decision To Suspend Trading On The Shares of Oando Plc

52. Trading on the Shares of Oando Plc Suspended; Reasons Unknown

53. Oando Gas & Power Rebrands as Axxela

54. House of Reps gives SEC Two weeks to submit Report on Oando PLC

55.  Oando Plc. - AGM Resolution

56. Oando Plc holds 40th AGM, engages Shareholders on the Progress of its Restructuring Plan

57.  Oando Plc's 40th AGM To Hold As Planned Following SEC Confirmation

58. Oando Plc to Hold 40th AGM on Sept 11, 2017

59.  Oando Plc Issues an Update on Claims of a SEC Investigation

60.  OANDO Declares N4.56bn Profit in Q2 2017 Results,(SP:N7.80k)

61.  Oando Issues Press Release over SEC Investigation

62. Corporate Earnings for the Week Ending 140717 - UCAP declares N1.99 billion Profit in Q2'17 Results

63. SEC Investigating Oando Plc

64. OANDO Plc Announces Closed Period

65. Oando Provides Clarifications on its Refinery Ambitions

66. OANDO Declares N1.71bn Profit in Q1 2017 Results,(SP:N5.80k)

67.  OANDO Plc Announces Closed Period

68. Oando Plc to Hold 2016 AGM on Tuesday 2nd August

69. Oando Plc Key Highlights on Q4 15 and Q1 16

70. OANDO Concludes Recapitalization Partial Divestment of Equity Stake in Its Downstream Operations

71.   Material Uncertainty May Cast Doubt on Oando's Ability to Continue as a Going Concern - Ernst & Young

72.  OANDO Releases Q4 15 and Q1 16 Results Declares N4.10bn PAT in Q1 SP N6.50k

73.  Oando Plc Secures 5 Year N94.6 Billion Medium Term Facility with 10 Nigerian Banks

74.  Oando explains what Deregulation of Petrol Price means for its Downstream Operations

75.  Why Oando Plc's 2015 Audited Statements will be released on May 31, 2016

76.  OANDO to acquire OER Minority Shares for a Consideration of US 1.20 per share in Cash

77.  The Corporate Governance Rating System - Proshare

78. ETI, Oando Plc under Fire over Ownership, Governance


Proshare Nigeria Pvt. Ltd.

Related News on SEC Laws and Corporate Governance

79.  The-Market-Memorandum---Fundamental-Considerations-for-Capital-Market-Reforms-in-Nigeria/2910

80.Corporate Governance and Directors' Remuneration

81.  SEC Proposes New Rules & Amendments to Rules on Book Building, Corporate Governance

82. Good Corporate Governance is Good Business

83. SEC, Udo Udoma And Corporate Governance: The Fact Files

84. Enabling Law - Investment and Securities Act (ISA) 2007

85. SEC Nigeria's Executed Rules and Regulations as at June 2017

86. SEC Nigeria's Consolidated Rules and Regulations as at 2013

87. Code of Corporate Governance for Public Companies 4 April 2011

Proshare Nigeria Pvt. Ltd. 

Related News on Oando from Other Sources

88. N236bn Liability: Oando Shareholders Protest in Ibadan - Independent

89. Intel's Volpi Steps Up Battle Against Wale Tinubu over Control of Oando - ThisDay

90. Suspension of OANDO PLC - SEC

91.  Oando Shareholders Set To Sack Wale Tinubu, Board -Independent

92. Notice to the General Public on Oando Plc - SEC

93.  So what's happening at Oando (2)? - Business Day

94. So what's happening at Oando (1)? - Business Day

95. The inside story: Why SEC ordered a Forensic audit of Oando Plc - Business Day

Proshare Nigeria Pvt. Ltd. 

Related News