Maurice Blackburn serves Treasury Wine Estates with class action
1 May 2020, Written by Business News Australia
Treasury Wine Estates (ASX: TWE) has been officially served with a second class action in the Supreme Court of Victoria today.
The statement of claim filed by law firm Maurice Blackburn on behalf of shareholders includes allegations that the winemaker contravened continuous disclosure obligations under the Corporations Act and claims that Treasury engaged in misleading or deceptive conduct.
The Maurice Blackburn class action is the second to be filed against Treasury Wine Estates and follows a separate proceeding filed by Slater & Gordon (ASX: SGH) on 3 April.
TWE says it strongly denies any and all allegations of wrongdoing and intends to defend the Maurice Blackburn proceeding.
Maurice Blackburn's class action centres on the Melbourne-based wine producer's declining performance in its Americas wine business since at least mid 2018.
"It follows Treasury's ASX announcement on 28 January 2020 in which Treasury downgraded its FY20 EBITS growth forecast from an anticipated rate of 15 per cent to 20 per cent to 5 per cent to 10 per cent," says Maurice Blackburn.
"There was a significant market reaction to this announcement. Over the following two days, Treasury's share price dropped by approximately 20 per cent in total, with a drop of 25 per cent on 29 January 2020 alone."
Treasury Wine Estates attributed the downgrade to unexpected company leadership changes and price undercutting in the US, combined with a higher cost of goods sold. This led to a 26 per cent year-on-year drop in earnings to $98.3 million for the Americas division in the first half.
Shareholders who purchased Treasury shares from 14 February 2019 to 28 January 2020 are eligible to register their interest with the law firm.
Law firm Slater & Gordon's class action alleges the information pertaining to Treasury's Americas business could have been uncorked earlier.
"On the basis of SGH's investigations to date, we consider that there is likely to be a reasonable basis to allege that TWE contravened its obligations of continuous disclosure and engaged in misleading or deceptive conduct, breaching relevant provisions of the Corporations Act 2001 (Cth)," said Slater & Gordon.
Shares in TWE are down 5.81 per cent today to $9.54 per share at 3:43pm AEST.
Business News Australia
Author: Business News Australia