Woolworths Group Limited is being accused of breaching disclosure obligations, including the 2001 Corporations Act, and engaging in deceptive or misleading conduct. That’s according to a recently filed class-action suit set in motion by Maurice Blackburn. The action has been slated for a hearing in February.
An LFJ Conversation with Michael Kelley, Partner, Parker Poe
Woolworths Group Limited is being accused of breaching disclosure obligations, including the 2001 Corporations Act, and engaging in deceptive or misleading conduct. That’s according to a recently filed class-action suit set in motion by Maurice Blackburn. The action has been slated for a hearing in February.
Maurice Blackburn, a leading class action firm in Australia, details that the action covers investors who purchased Woolworths shares between August 2014 and May 2015. A central question in the case revolves around whether the company had a reasonable basis for its guidance to investors.
Guidance was based on NPAT and NPAT Growth as performance metrics. If the company did not have a reasonable basis for its initial guidance, this may have led to inflated pricing for investors, who were then damaged by overpaying.
The claim is being financed by International Litigation Funding Partners (ILFP). Omni Bridgeway, which had initially proposed funding for the class action, withdrew its funding proposal in 2018. In accordance with the funding agreement, ILFP will receive cost and expenses, plus a percentage of any recovery as detailed in Clause 10 of the agreement.
Share prices dropped after announcements that WGL would not meet its stated goals. Investors were then informed that it would take a large investment of money and time to regain the sales momentum that had been lost.
An earlier attempt at mediation led to the closure of additions to the class—which has now expired. As such, impacted persons who have not opted out of the action are able to register as class members at Maurice Blackburn’s website.
