Technology Ltd ('Technology') has for many years conducted a successful computer software business specialising in an accounting package for credit unions located in NSW. Aztec Ltd ('Aztec') is a large IT firm that owns 10% of the shares in Technology and has one of its executives (Matt, who is not a director of Aztec) as a non-executive director of Technology. The other directors of Technology are Grace (who acts as the CEO/MD and the Chair) and Susan (who is also CFO). Grace and Susan each own 26% of the shares in Technology (52% combined) and the companies employees own the remaining 38% of the shares.

Aztec has wanted to take over Technology for some time, but prior offers have been rejected by the Technology board. The management of Aztec decide that they will seek to use Matt's position on the board of Technology to gain information that will help develop their own software products to compete with Technology.

While acting as a director of Technology, Matt joins a board sub-committee that is investigating blockchain technology. The sub-committee receives detailed expert reports and project designs using the new technology prepared by the firm of BlockTech Pty Ltd. The sub-committee is going to recommend to the Technology board that the company pursue the blockchain proposal, but Matt suggests that the company wait to conduct further due diligence, saying that blockchain technology is just a new trend and hasn't been successfully rolled out for any major enterprise business software in the world. Grace and Susan agree with Matt and postpone the decision for another 6 months.

What Matt failed to disclose to the Technology board was that his other company (Aztec) has been working on an enterprise commercial finance blockchain product for some time. Matt had been using some of the information that he gained from the Technology sub-committee work to inform how Aztec's product is being developed. At the start of the relevant Technology board meeting, Matt stated to Grace and Susan that 'of course, you are both aware of my role with Aztec, which may conflict with the work of Technology, but I'll be sure to let you know if any problems arise.' Susan and Grace continue the meeting with Matt, where they decided to delay the implementation of the blockchain project. Technology has a constitutional provision that allows directors with a material personal interest to participate in board meetings provided that they give full disclosure at the start of the meeting.

Matt also proposes that Technology invest in BlockTech (the consulting firm that advised the company on its blockchain proposal) so that BlockTech could continue its work for the company in the future. Matt does not advise the company that Aztec is a major shareholder (through a nominee company) in BlockTech and will benefit from Technology's investment.

Several months later, Aztec announces a major blockchain contract with several credit unions and other financial institutions, as well as BlockTech agreeing to exclusively license its blockchain technology to Aztec. The blockchain product is very similar to the product that was being considered by Technology, but with several major additional features included by Aztec using Aztec's proprietary software (that Technology would not have been able to use in its proposed product). The Aztec blockchain product is incredible successful and Aztec makes over $100 million in profits from it. The Aztec board fully supported and encouraged Matt's conduct while acting on the Technology board.

Grace and Susan are furious and feel that Matt has deceived them. Matt responds that the blockchain contracts that Aztec has signed with its clients were signed because of Aztec's full suite of financial and administrative services, which Technology could not offer so Matt says that Technology could not have secured those contracts anyway.

Advise the Technology board as to what rights it may have against Matt and/or Aztec.