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David Jones defends Fraser-Kirk settlement

On Friday 3 December 2010, 11:11 EST

David Jones Ltd says settling the sexual harassment lawsuit brought by former publicist Kristy Fraser-Kirk was "the right thing to do".

The retailer held its annual general meeting in Sydney on Friday, the first since former chief executive Mark McInnes had his contract terminated due to the sexual assault allegations.

Chairman Robert Savage described the drama as "a major disruption" in the retailer's financial year.

Ms Fraser-Kirk dropped her $37 million claim against David Jones, Mr McInnes and nine directors in October after the retailer settled for $850,000.

Mr McInnes made a "smaller contribution" to that amount, Mr Savage said on Friday.

"We are pleased that all parties are able to heal, learn, rebuild and move on," he said.

The decision by David Jones to settle was a "straight risk/return decision" made after considering the interests of the company, its shareholders, its brand and its employees, he said.

It meant the company could provide certainty of the outcome without "the burden of a final hearing", Mr Savage said.

It also eliminated the burden of ongoing legal fees, and the need for key executives to commit time to the case during the busiest time of the year for retailers.

"In short, all things considered, it was the right thing to do," Mr Savage said.

"Finally, while I cannot provide any guarantees, I want to reassure shareholders that the company is doing its best to ensure that this type of situation does not recur," he added.

Chief executive Paul Zahra, appearing before shareholders for the first time, did not deliver an update on the company's financial guidance, other than to say David Jones had never been better prepared for a Christmas trading period.