Insider trading case set for retrial

A court case involving a former Eroad employee and shareholder, accused of selling thousands of shares after a tipoff, has ended with a hung jury.

The jury of 12 selected to judge the case could not come to a conclusive verdict on Hamish Marc Sansom’s trial, which played out over two weeks.

Financial Markets Authority (FMA) spokesman Andrew Park said there would be a retrial and the callover date would be announced in coming weeks.

The FMA alleged Sansom sold 15,000 Eroad shares after Eroad analytics manager Jeffrey Peter Honey sent a text message telling him to sell.

In the text, Honey revealed confidential information about the company’s financial performance in its North American market and said ‘‘US sales not doing [well], time to sell up? Confidential obviously.’’

Sansom replied: ‘‘You’re a bad boy but thanks.’’

Honey texted the shareholder a photo of confidential information that showed Eroad’s US sales had been lower than expected following an aggressive North American expansion.

Prosecutor Nick Williams told the Auckland High Court on Tuesday: ‘‘You cannot make this up. You cannot make up a better scenario to establish the offence of insider trading. You’ve got it all here in the text messages.’’

Sansom worked at Eroad when it listed on the New Zealand stock exchange, and was made redundant in 2015.

Honey and Sansom had worked at Vodafone together before Eroad. Honey was also hired by Sansom and reported directly to him.

Honey was sentenced to six months’ home detention last year.

Williams said Sansom knew the information was confidential.

Eroad disclosed the information about the underperforming US sales in a statement to the NZX four days after Sansom sold his shares.

A week after the announcement, Eroad shares dropped 21 per cent, the biggest decline since the company had listed.

But defence lawyer David Jones, QC, said on Tuesday that Sansom knew of the poor sales ‘‘well before’’ he received the text from Honey.

A month before Sansom sold his shares, Eroad announced at its annual meeting that the company’s US market in Oregon was performing poorly, Jones said.

‘‘Sansom is someone who follows the rules but he is in trouble because someone sent him a message he didn’t ask for or want and with information he already knew about,’’ Jones said. ‘‘This is not

He is someone who works hard for his family and has been caught up in something he had no idea about,’’ Jones said.

Honey later text messaged Sansom saying: ‘‘hope you sold’’.

After Sansom sold his Eroad shares, he bought shares in Fletcher Building.