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Firm targets supermarket giant in filed class action
A national law firm has launched a class action against Woolworths in the Federal Court, estimating a claim exceeding $100 million.
Emma Musgrave
Maurice Blackburn, together with litigation funder International Litigation Funding Partners (ILFP), has filed the class action against the supermarket giant on behalf of aggrieved shareholders.
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Maurice Blackburn class actions principal Andrew Watson said the case against Woolworths alleges the company breached its continuous disclosure obligations and engaged in misleading conduct by issuing and reaffirming a profit guidance that could not be met without adversely affecting Woolworths' competitiveness.
In 2015, Woolworths hit the market with a significant profit downgrade and made subsequent admissions about the "flawed metrics" that underpinned the original guidance it provided.
“Cases such as this reinforce the need to increase and enhance transparency and proper disclosures from large listed companies, and to ensure they are held to account if they fail to provide the market with accurate information,” Mr Watson said.
Commenting further, lead plaintiff Norman Wills said that while he was well aware of the natural volatility of the share market, he had been shocked to learn about the disclosure issues of a company he once considered to be a well-run operation.
“It turns out that what I thought was one of the most reliable companies on the ASX with good businesses at its core, looks like it has failed to inform the market of what was going on within the company. I’m really disappointed in the way the company behaved and Woolworths needs to be held to account,” Mr Wills said.
