Thousands of former employees at collapsed retailer have been awarded damages by an employment tribunal.
Over 2,000 ex-Comet staff filed a suit against Comet and administrators Deloitte alleging that they were not properly consulted prior to its closure in 2012.
In total it was ruled that 6,889 workers were mistreated, paving the way for a potential payout of over £10m with each individual now entitled to a maximum of eight week’s wages at £450 per week.
Their case was backed by Comet’s former head of finance Michael Walters.
Stated the judgement: “'As the evidence makes clear, this was simply an old fashioned corporate raid that resulted in a number of private equity investors choosing to liquidate a 75-year-old British company, at a cost of almost 6,900 jobs in order to realise a quick and substantial profit.
"The liquidation of Comet may properly be described as one of the more regrettable episodes of British corporate history."
Those private equity investors? Henry Jackson's OpCapita and hedge fund Elliott Advisors, who were also behind GAME’s exit from administration in 2012 and its IPO earlier this month. The Telegraph reports that it is estimated that the pair pocketed £117m from Comet’s demise, with Deloitte collecting over £10m.
Despite this, creditors were left £232m out of pocket and it is the Government – or British tax payer, if you prefer – who will have to foot this new bill.
Joint liquidators Neville Kahn and Chris Farrington of Deloitte defended its conduct, stating: “It is disappointing that the tribunal has found against the company.
"The Comet management team, administrators from Deloitte and our advisors worked tremendously hard under very challenging circumstances to provide the best possible consultation to the employees. Comet Group Limited made significant efforts to consult with its nearly 7,000 employees across more than 250 sites during the Administration, whilst a purchaser for the business was sought.
"Regrettably, it proved impossible to find a purchaser willing to save the business and all the employees ultimately had to be made redundant."
The news is a further blow against the arguably shady administration and liquidation practices often employed in the retail sector.
In February GAME lost a legal battle with a landlords consortium over missed rent payments for the period in which the company was in administration.