Share price dispute in Cork-based IT provider admitted to commercial court list

Wisetek Solutions Ltd has a registered address in Glanmire, Cork. The company offers services including IT asset disposal and electronics recycling.

A dispute over the price paid to two shareholders for their stakes in an IT company has been admitted to the fast-track commercial court list.

The action has been brought by Zachary Boorstein and Christopher Scott, who are based in the US, against Wisetek Solutions Limited, with a registered address in Glanmire, Cork.

Wisetek offers services including IT asset disposal and electronics recycling.

The plaintiffs claim that under the terms of a share purchase agreement entered into with the company four years ago, they are entitled to be paid either $1.65m (€1.4m) each, or the market value of, 7.5% stakes they each held in the company.

Wisetek disputes the shareholder's claims and says the applicants were entitled to be each paid $1.65m for their respective shareholdings, and has paid the plaintiffs accordingly.

The court heard the plaintiffs have not articulated what they say is the market value of their shareholdings in Wisetek.

However, Wisetek, which denies the claims against it, says it assumes the value eventually put on the shares by the plaintiffs will exceed the amount it paid them to acquire their shares.

Wisetek, represented by Rossa Fanning, told the High Court that his client was seeking to have the case admitted to the list as the proceedings are commercial in nature.

Counsel said the case came down to an interpretation of a term or clause within the agreement entered into by the parties in 2017.

That arrangement saw the two plaintiffs sell their shareholding in a US company called Computer Discounters Inc to a subsidiary of Wistek, in return for shares in the defendant.

As part of the arrangement, it was further agreed that Wisetek would pay each of the plaintiffs a sum of $1.65m by October 31, 2021, in return for their stake in Wisetek.

The two were also kept on as employees of the Wisetek group on salaries of $230,000 per year for a term of three years.

In October 2020, Wisetek informed the plaintiffs their employment agreements would not be renewed beyond the three-year term.

Wisetek claims as part of the 2017 arrangement, it paid each of the plaintiffs what it claims was the agreed redemption price of $1.65m.

The plaintiffs claim that they are entitled to have their shareholding redeemed at a greater value than what they received. They have brought proceedings before the Irish and US courts.

They also claim that their roles when working for Wisetek after they sold it their stake in Computer Discounters Inc were not as had been originally envisaged.

The matter came before Mr Justice Denis McDonald, the judge in charge of the big business division of the High Court. The application was not opposed.

Following the application by Mr Fanning, the judge admitted the case to the commercial court list. The judge made the matter returnable to a date in January 2022.