Metal Storm Collapse Leads To Multi- Million-Dollar Lawsuit

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Australian company Metal Storm, home of the eponymous electrically-fired sequential-firing high rate of fire concept, became insolvent and was placed under administration in 2012, but the fallout is ongoing, and could become considerable. Financial Review reports:

A New York-based investment firm advised by John Hancock will sue Equity Trustees for tens of millions of dollars following the demise of electronic ballistics technology company Metal Storm.

The damages claim by the Lind Partners will follow a lengthy and technical legal dispute over how the voluntary administration of Metal Storm was handled in 2012. Lind helped finance the company, and held secured notes, and ANZ Bank was the trustee.

A Supreme Court judge ruled in August that Lind’s Australian Special Opportunity fund could pursue a “damages or equitable compensation” claim against Metal Storm’s trustee; and the time to appeal that order has now lapsed.

ANZ has since sold its trustee business to Equity Trustees, and a spokesman for the bank said that Equity Trustees, and not ANZ, would be liable for any damages. An Equity Trustees spokeswoman declined to comment.

Lind managing director Jeff Easton said money retrieved through a damages claim would be used to increase its investment program in Australian companies. He said the technology sector was attractive, especially given the country’s research and development tax incentive.

“We are committed to Australia even though it’s been a very long haul,” said Mr Easton, referring to the litigation.

“I think we are in the first or second innings of the renaissance of the tech sector.”

Claim likely to run to “tens of millions of dollars”

Mr Easton declined to comment on how much the damages claim would be. But those with knowledge of the litigation said a damages claim would likely run into the “tens of millions of dollars”.

Lind argues that the trustee’s actions prevented Metal Storm from securing contracts or progressing contract negotiations or obtaining a fair price for its assets. ANZ’s actions may have also allegedly deprived Lind from purchasing Metal Storm’s intellectual property, according to Lind.

Australian defence company DefendTex has since acquired Metal Storm’s technology.

The concept of Metal Storm is to use an obdurating element in the projectile of each round to seal the bore, where rounds are stacked in a similar fashion to a Roman candle in the barrel and fired sequentially. The obdurating element helps prevent hot propellant gases from flowing rearward and affecting the rounds behind the one currently being fired. The result is a weapon that can produce extremely high rates of fire. With no need for the normal cycling of a mechanical action, some multi-barrel Metal Storm prototypes were capable of rates of fire of up to a million rounds per minute.

Metal Storm has had a tumultuous ride in the two decades since its founding. Despite winning several research contracts in the 2000s, the company was showing signs of insolvency even as early as 2010.  Lind Partners, a New York-based asset management firm, backed the company in late 2011. By July of 2012, the company entered voluntary administration with the Australian government, which lasted until it entered receivership in 2014. In 2015, the company’s assets were purchased by another Australian company, DefendTex.

Thanks to Daniel for the tip.



Nathaniel F

Nathaniel is a history enthusiast and firearms hobbyist whose primary interest lies in military small arms technological developments beginning with the smokeless powder era. In addition to contributing to The Firearm Blog, he runs 196,800 Revolutions Per Minute, a blog devoted to modern small arms design and theory. He can be reached via email at nathaniel.f@staff.thefirearmblog.com.


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  • Tassiebush

    I’d wondered how this company was going. I wonder what the next incarnation of this tech will be?

    • ostiariusalpha

      Who knows, really? It would be fittingly ironic if any new incarnation kept coming from a Land Down Under. From Russ Robinson & his AR-13 to J. Mike O’Dwyer, it seems like Australians are the only ones that show any initiative for developing these hypervelocity stacked volley guns.

      • Tassiebush

        I certainly hope it can get a new incarnation. I think it definitely needs to be matched with well thought out electronics. Seems like a smart sight system could be matched to it to take into account the slightly different ballistics and manage rate of fire depending on target range.

    • mechamaster

      I imagine the short-term incarnation something this… smoke grenade launcher… with MetalStorm stacked-caseless-grenade will be safe-approach for the market.

      Or to complement Active Anti Missile System like Trophy-system for example.

      • Jwedel1231

        Or the 4 barreled pistol (with 4 shots per barrel) that could fire multiple rounds before the recoil even affected point of aim. Then again, you have electronic controlled pistols, which leads to smart guns, which leads to BS laws, which lead to… Nevermind, I like my mechanical fire control systems better anyway.

        • mechamaster

          That’s why it’s better reserved for unmanned drone / vehicle remote armament rather than personal firearms ( nobody want ” Electronic Smart-Gun BS that lead to gun-control / confiscation idea for anti-gun faction” ).

      • Tassiebush

        Yeah that makes sense. It’d probably at least treble the capacity of those devices and it wouldn’t have to treble the cost to do that presumably.

  • Mystick

    The problem may be that it’s set up shop in a hostile country.

    • Jwedel1231

      The problem is that they are trying to solve a problem that has other viable, more elegant solutions. Setting up shop in Australia didn’t help them, though.

      • 5flytyr .

        Spraying the “sand roaches” with the appropriate chemical solution being the most appealing to me….

        • Guy

          Calm down there Hitler.

  • Kivaari

    Wouldn’t a better guidance system for existing tube weapons be less costly? Don’t we have adequate war-shots able to deliver sub-munitions?

  • smartacus

    …BTW everybody, it’s been 24 hours and still no official apology from Goodyear/Dunlop. Now watch their precipitous downfall.

  • Gunhead

    A pity, they were just starting to make practical small arms that really took advantage of the concept (namely the MAUL and 3GL).

  • /k/ommando

    Metalstorm is the type of thing a drug baron would buy 5 of and then keep in his basement to feel safe.

  • Jersy

    A real shame – I think they were on the right track with the 3GL as a small compact grenade launcher. It also had a “two barrel option for mission specific needs”. No pictures of it anywhere, but it made me wonder how it would fare against the likes of milkor etc. It might also be interesting in a 2×2 shoulder-fired configuration similar to m202 flash rocket launcher… I wonder what DefendTex is going to do with the technology…

  • Cattoo

    A simplified single use, so as to deny enemy use after the first discharge, could be that of booby trap or even a landmine type device. Caliber to be decided but stepping on a plate filled with any number of ammo from .22lr thru .50AE would be be detrimental to the individual that tripped it. Possibly could be designed to only go off after certain weight requirements pressing down on the trigger mechanism were met.