Morton House MGT and First Form Construction Limited, the company that tried and failed to take control of Rochdale last summer, has begun legal action against the club, its directors and — most remarkably — its supporters.
Dale Trust, the fans’ group with a membership totalling 1,
300, believes it is now the subject of litigation never seen before in English
football. A shareholder is effectively taking a section of the club’s
supporters to the High Court.
Where this legal wrangle leads is unclear but Rochdale’s
togetherness is facing a prolonged test. They had hoped an external threat to
harmony had been banished back in August when Morton House told the EFL of
plans to divest its shareholding, but the legal petition issued two days before
Christmas has demanded further unity.
A six-figure sum would be needed to cover legal costs if
this case goes all the way to the High Court and crowdfunding has already
raised close to £34,000. Donations big and small have come from nearly 700
people.
Matt Southall,formerly controversially associated with
Charlton Athletic, is formally working as an advisor to the firm that agreed to
buy a 42.3 per cent shareholding last summer.
“Morton House did not want it to get to this point,” he
says. “It tried on numerous occasions to come to an agreement but ultimately,
if you invest £1.2 million in a company, you’re within your rights to protect
that investment. It’s now down to the respondents to plead against the case.”
A search for outside investment came to nothing last spring
but, by summer, on to the scene came Morton House, then fronted by Andy Curran
and Darrel Rose, hoovering up the shareholdings of six individuals and groups
that ran to approximately 220,000 shares.
They had hoped to reach a majority — thus taking control —
but attempts to buy the key shares owned by director Andrew Kelly came to
nothing. They were instead sold to the Dale Trust, which became the
second-largest shareholder. The late super-fan David Clough, whose statue sits
in the main stand, helped fund the purchase after leaving his estate to the
club when dying in 2020.
Morton House argues it was not given the opportunity to
purchase shares to increase its own holding in Rochdale when there was a share
issue in November. The new share issue
has seen their 42.3 per cent stake fall to 23 per cent.
Morton House, in short, believes Rochdale acted unlawfully
against a shareholder and that Dale Trust was able to benefit by purchasing
85,000 newly allotted shares in November. They are points that the club’s board
and Dale Trust “strenuously deny”.
“It’s a petition against unfair prejudice,” explains
Southall, who says he began advising Morton House in the autumn and would be
willing to buy a 25 per cent stake of the company.
“Just because they’re the supporters trust, can’t they face
the consequences of unlawful action? That’s not a good precedent for the rest
of the football industry. They benefited from the unlawful actions of the
directors, which is why they’re involved in proceedings.”
Now it is Southall front and centre and his history is doing
little to calm fans. Southall was chief executive at Charlton during one of the
club’s most turbulent spells and left under a cloud. By the summer of 2020 he
was ordered to pay £21,000 costs after admitting to unlawfully changing the
status of directors at the club’s parent company, East Street Investments.
Southall is deeply unpopular in south London, a fact borne
out by the number of donations to Rochdale’s crowd-funding page from Charlton
supporters. There is, though, an interest in returning to football’s front
line.
“It is like a drug,” says Southall. “I feel like I’ve got a
point to prove after my time at Charlton. I want to show I was wronged.”
Southall says the EFL have told him there would be nothing
to prevent him becoming a relevant person and that he attempted to buy 125,000
shares at Rochdale’s share issue in November.
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