By now most people know the name Village Life. The rental village operator continues to be in the headlines for all the wrong reasons. The entire industry is still in PR damage control after the company served evictions notices on the residents of 10 of its villages just two months ago. The company had been desperately working to sell its management rights to all its villages to the SCV Group (SunnyCove) and these ten villages were a potential sticking point. Thanks to its blunt fist approach there is another run of government reviews and the potential of increased regulation.
Now three of the founding directors of Village Life are being sued by the aggressive law firm Slater and Gordon on behalf of a group of investors in the original float on the stock exchange of the company just over three years ago. In December 2003 the company claimed in its prospectus that it would build 102 retirement villages and make a net profit of $15.4 million within 24 months. Instead, they managed to build only 69 villages (still not a bad effort) and make just a $2 million profit - which was 90% below forecast. The shareholders claim the directors knew early they would not achieve their targets but did not inform the market until 2005. They are claiming $30 million from the company and the directors.
