Apple Australia in court battle over failed retail chain

Computer giant Apple Australia is locked in a battle in the NSW Supreme Court involving the liquidation of Australian retailer Buzzle, which entered receivership in March 2001.


The two companies have been engaged in legal battles since the start of liquidation proceedings. In the latest case, liquidator Andrew Wily of Armstrong Wily is seeking $57 million in damages.  


Wily has accused Apple Australia and its former chief financial officer, Jim Likidis, of assuming “shadow director” roles during the last days of Buzzle’s operations.


Buzzle, which collapsed with $30 million in debt, owed $20 million of this to Apple, which was its major supplier.


Wily claims Apple executives controlled the Buzzle board and that when the company was broke in March 2001, Apple needed the company to continue trading to prevent the resellers from demerging.


Apple has rejected claims that it or Likidis operated as a shadow director.


“It will be alleged in these proceedings that Apple was aware that the company (Buzzle) was insolvent and should not have allowed the debts to be incurred,” Wily told The Australian in 2005.


“As such there is a legal argument that Apple may be held liable for debts incurred by Buzzle. Further, we are claiming that the charge over Buzzle is void.”


The case has been heard in the NSW Supreme Court over the last week and is expected to continue into next week.


The court battle is the latest in a series of claims and counter claims between Apple and Buzzle.


Apple even attempted to have Wily removed from his position as liquidator in 2003, which Wily then contested as a “gratuitous add-on” to the original legal battle between the two parties.


The Buzzle chain was created in September 2000 after six of Apple’s resellers merged. It has planned to trade for six months and then launch a $110 million sharemarket float, but the company collapsed.


The painful demise of Buzzle was captured in a documentary called Going Public.


Andrew Wily and Apple Australia did not return calls by the time of publication.



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