The Full Federal Court has awarded a victory to shareholders in a class action filed by Shine Lawyers. The Federal Court had dismissed the claim at first instance, but Shine Lawyers has successfully appealed Justice Gleeson’s decision.
Shine Lawyers is seeking compensation on behalf of affected persons who acquired shares in Worley Ltd (ASX:WOR — formerly known as WorleyParsons) between 14 August 2013 and 19 November 2013.
“Our claim alleged that WOR failed to inform the market of its true earnings outlook and did not have reasonable grounds for its FY2013 profit forecasts.”
“Between August and November of 2013, WOR announced a FY2012 profit of $322 million and provided the market with inflated earnings forecasts showing earnings growth in FY2013”
“The company announced its inflated and erroneous earnings forecast in August 2013 and repeated it in October 2013, only to issue a downgraded forecast in November 2013,” said Class Actions Practice Leader, Craig Allsopp.
Shine’s class action alleges this disclosure resulted in a 26% fall in the WOR share price, from $21.59 to $16. Shareholders also alleged the price drop reduced the market cap of WOR by approximately $1.375 billion.
“Shine Lawyers is proud to have represented these shareholders in an action focussed on accountability and the importance of implementing proper processes to ensure price sensitive information is disclosed to the market in a timely way.”
“This puts all corporations on notice and provides a timely warning to those companies that do not prioritise transparency in their disclosures to shareholders,” said Mr. Allsopp.
The Court has ordered that the matter be remitted to a single judge for a hearing to determine further issues, including costs of the initial trial.
