SA venture capital fund manager Elaine Stead claims a campaign of vilification by the AFR made her out to look ‘stupid’
Elaine Stead, a high profile Adelaide-based venture capitalist, claims columns in the AFR made her look “stupid” and “reckless”.
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Elaine Stead, a high profile Adelaide-based venture capitalist, says a series of columns in the AFR made her look “stupid” and “reckless”.
SA Venture Capital fund manager Elaine Stead has filed a defamation suit against Fairfax Media alleging it imputed she was” a cretinously stupid person” and “wilfully destroyed the capital of business ventures with which she was associated causing enormous losses to unitholders’’.
The Federal Court claim, lodged against Fairfax Media and Australian Financial Review columnist Joe Aston, relates to several Rear Window columns the AFR has published over the past two years, critical of Ms Stead, relating to her role as a director of collapsed investment firm Blue Sky Alternative Investments.
One article also calls into question the judgment of the South Australian State Government and Premier Steven Marshall in particular, for continuing to employ Ms Stead, and requiring that she be employed by any future manager of the state’s $50 million venture capital fund.
Ms Stead told The Advertiser that she had filed the suit, “in order to restore my reputation and look forward to the court’s determination of my claim’’.
Ms Stead’s lawyers wrote to the AFR in November about a column published the previous month, demanding it be removed from the AFR’s website and apologise, according to her claim. But the AFR’s lawyers wrote to her saying it “stands by the stories as published”.
The following month Ms Stead lodged her case, and is also suing over another column as well as a Twitter post by Mr Aston.
Her claim also references numerous other articles referring to her published by the AFR in the last two years.
The claim says two AFR columns carried the imputation that she:
- “recklessly destroyed the capital of business ventures with which she was associated causing enormous losses to unit holders”, and was
- “a venture capitalist, who made stupid investments in two worthless companies, Shoes Of Prey and Vinomofo, which had no business and no prospects of success’’.
Ms Stead also claims she was made out to be “untrustworthy” and “wantonly lost millions of dollars entrusted to her by unsuspecting investors by channelling their funds into a string of hopeless investments’’.
Ms Stead says in the claim that she suffered “enormous damage in both her personal and professional reputation”.
In particular she says she was at one time in discussions for four months with three business partners regarding a proposed venture capital fund and, “Following publication of the second matter complained of, the applicant was informed by one of her business partners that by reason of the matter complained of, it was necessary to reduce and limit her role in the proposed venture capital fund’’.
The details of the fund itself are confidential, and further details will be provided “in due course” the claim says.
Ms Stead also alleges there was a “relentless campaign of vilification’’ against her, and the columns implied that she “is not competent to hold the position of VC fund manager for South Australia because she deliberately and shamelessly lost other people’s money’’.
Ms Stead was an executive director of Blue Sky which collapsed in May last year after short-seller Glaucus Research released a scathing report into the company’s business affairs.
Blue Sky was the manager of the state’s $50 million venture capital fund, and Ms Stead and her team have continued to manage it following Blue Sky being placed in liquidation.
The Advertiser revealed last year that BSVC Pty Ltd - the Blue Sky subsidiary managing the fund - was to be paid management fees ranging from $915,751 to $1,045,568 per year for the first seven years of the 15 year contract, then $703,094 per year for the remainder.
The State Government has gone to tender for a new manager for the fund, but under the terms of that tender Ms Stead and her team would have to continue to be employed.
In June last year Ms Stead registered a new company, Human Venture Capital, and her colleague Alex Grigg, who is the SA fund’s investment manager, joined as a director in August.
In October Treasurer Rob Lucas said the expression of interest process for a new manager for the fund had attracted 18 applications.
Mr Lucas would not comment on the court case today. He said the SAVCF committee had advised him it was nearing the end of its deliberations and was likely about a month away from making a decision on a new manager for the fund.
Nine Entertainment Co., which owns Fairfax, is yet to file a defence.
Nine declined to comment further.