Edmark Direct Marketing Limited, a top multi-level marketing company in Nigeria is currently enmeshed in internal crisis that may lead to the shutting down of the company if urgent steps are not taken to salvage the situation.
This is because, the battle between shareholders of the company has taken on a new twist as a Federal High Court sitting in Lagos State issued a further interim order reaffirming the appointment of a Nigerian lawyer as a Receiver/Manager.
According to the order, the company, its distributors or any other person cannot import or sell Edmark-branded products except through a Receiver/Manager, Mr. Seyi Akinwunmi.
In addition, the court ordered the Nigerian Customs Service and the Nigerian police to assist Akinwunmi in prohibiting the directors of Edmark Direct Marketing Ltd and their agents from circumventing him in importing, marketing, selling and/or distributing any products.
In the Suit No: FHC/L/CP/890/2022 between Etim Maurice Anthony (Nigerian Shareholder) and Low Ban Chai (foreign shareholder), Edmark Direct Marketing, Edmark Direct Holding Limited, Wapiano Bienviendo and Jorolan Noel Noa before Justice C.J. Aneke, the court’s orders gives further effect and assistance to the earlier interim order and appointment of Receiver/Manager made on May 24, 2022.
According to the registrar’s notice of consequence of disobedience, the court made a further interim order empowering Akinwunmi, a Legal and Insolvency Practitioner of Akinwunmi & Busari, to take into custody certain funds which Etim was entitled to in the hands of the third parties, pending the hearing and determination of the motion on notice.
Furthermore, it directed all banks to attach the accounts of two Edmark officials/ employees: Batusin Rey Cudeira (Head of Treasury) and Abubakar Abass ( Branch in-Charge) for receiving cash sales in circumvention of the court appointed Receiver/Manager.
The court also made an interim order directing all banks to attach the bank accounts of Edmark City Development Limited, ED2E Technology Nigeria Limited and Megawong Nigeria Limited and within seven days of being served the order, the banks should file an affidavit disclosing the statement of all accounts linked to the persons and entities earlier mentioned from June 23, 2022 to date and serve same on the parties (through their counsel and to the Receiver/Manager).
It also mandated the persons and entities mentioned: Batusin Rey Cudeira , Abubakar Abass Edmark City Development Limited, ED2E Technology Nigeria Limited and Megawong Nigeria Limited within 7 days of service of the order to immediately give full account of Edmark’s monies received from June 23, 2022 to date.
This latest order may be a good news for the Nigerian minority shareholder, Mr. Etim who had dragged the Foreign majority shareholder, Low Ban Chai to court for arranging a forgery of his signature to appoint more directors in effort to edge him out of the company, amongst other actions of oppressive, unfair and prejudicial breached against the Nigerian minority.
He also averred that his relevant rights such as right to attend meetings and vote, appointment and removal of company secretary, access to accounting records were breached.
“FURTHER TO THE ORDERS made on 24 May 2022, a further interim order enabling the Court Appointed Receiver/Manager, Mr Seyi Akinwunmi a Legal and Insolvency Practitioner of Akinwunmi & Busari, A & B Place, 198 Bashorun Okusanya Avenue, Off Admiralty Road, Lekki Phase 1, Lagos, to take into custody certain funds which appear that the 1st Respondent was entitled to in the hands of third parties, pending the hearing and determination of the Motion on Notice dated 30 September, 2022,” part of the court document read.
“FURTHER TO THE ORDERS made on 24 May 2022, a further interim order directing all banks to attach the bank accounts of following officials/employees of the 1″ Respondent for receiving proceeds of cash sales of the 1 Respondent’s products into their accounts, in circumvention of the Court Appointed Receiver/Manager, pending the hearing and determination of the Motion on Notice dated 30 September, 2022;
“FURTHER TO THE ORDERS made on 24 May 2022, a further interim order directing the Nigerian Customs Services and Nigerian Police to aid the Receiver/ Manager (Mr. Seyi Akinwumi a Legal and Insolvency Practitioner) in censuring and prohibiting the 1 Respondent’s officials and distributors from circumventing the Receiver/Manager, in importing, marketing, distributing and selling any products under the 1 Respondent’s registered trademark “Edmark” pending the hearing and determination of the Motion on Notice dated 30 September, 2022.
“(4) FURTHER TO THE ORDERS made on 24 May 2022, a further interim order directing all banks to attach the bank accounts of the following entities mentioned in the Ex-parte Order dated 24 May 2022 and identified in the tables below are to be attached pending the hearing and determination of the Motion on Notice dated 30 September, 2022.
“FURTHER TO THE ABOVE, a further interim 2010 2 order directing all banks served with this order to, within seven days of the date of O.Y. THOMAS (MRS) service, file an affidavit disclosing the statements of all accounts linked to the persons and entities identified in Tables 1 and 2 above for the period of 23 June 2022 to date, and serve same on the parties (through their counsel) and the Receiver/Manager (Mr. Seyi Akinwumi of Akinwumi & Busari, A & B Place, 198 Bashorun Okusanya Avenue, Off Admiralty Road, Lekki Phase 1, Lagos).
“FURTHER TO THE ABOVE, a further interim order directing the persons and entities listed in Tables 1 and 2 above to, within 7 days of service of this order on them, Immediately give a full account of the 1 Respondent’s monies received into their accounts between 23 June 2022 to date, and serve same on parties (through their counsel) and the Receiver/Manager (Mr. Seyi Akinwumi of Akinwumi & Busari, A&B Place, 198 Bashorun Okusanya Avenue, Off Admiralty Road, Lekki Phase 1, Lagos).”
In addition to prayers such as appointment of a Receiver/Manager, he wanted the court to appoint Deloitte Nigeria so it can conduct a forensic audit of Edmark and its affiliate company.
The suit has been adjourned to November, 14, 2022 for further hearing.
