Star Entertainment ex-chief executive Matthias Bekier and ex-general counsel Paula Martin were found by the Federal Court on Thursday to have breached their duties while leading the embattled casino operator.
Justice Michael Lee said the pair failed to inform the board of potential risks related to overseas junkets with alleged criminal connections and false claims about customer use of credit cards for gambling purposes.
However, he also found that the Australian Securities and Investments Commission had failed to prove that Star's former chair John O'Neill and six board members had breached the law.
In his 501-page judgment, Justice Lee dismissed the claims against them but he also noted the board had not actively pressed management after consistently facing huge amounts of material that "no rational person can evaluate ... in the time available".
Outgoing ASIC chair Joe Longo on Friday acknowledged that boards being flooded with documents was a real problem, even though it was boards that ultimately controlled how information was presented to them.
"It's an issue that Australian boards, I think, are still grappling with," Mr Longo told a federal parliament committee hearing under privilege.
"A lot of the directors I speak to, in the bigger institutions, they all complain about the body of material they are expected to get through for each board meeting."
Earlier, Mr Longo acknowledged under questioning that the outcome of the case might not satisfy community expectations - aka the pub test - but the regulator was accepting of the ruling.
"The standards of proof and process in matters of this kind are high," he told the hearing in Sydney.
He stressed the legal right of directors to silence in civil penalty proceedings. None of the seven Star board members who were sued was required to file a defence.
Asked if ASIC would appeal, Mr Longo stressed the regulator at this stage didn't know, given the court was still to make further orders.
"We're just going to follow our normal process, we are going to carefully consider this judgement," he said.
"But I really want to stress ... that we are a long way from that."
Mr Longo said the Australian Institute of Company Directors, with whom he will be meeting with on Tuesday, was taking the findings on board.
Of the eleven persons sued in the Star matter, two settled, two were found to have breached the law, while the remaining seven were found not to have breached the law.
"No doubt it was the right thing to commence proceedings," Mr Longo said.
