LOGISTICS giant Brambles says it is reviewing a Federal Court judgement after two rulings were made against it as part of a class action.
The case was brought by law firms Slater & Gordon and Maurice Blackburn on behalf of investors who acquired Brambles shares between August 2016 and February 2017.
The class action was based upon Brambles’ profit guidance in the 2017 financial year and subsequent downgrade announcements in which it was alleged Brambles failed to properly disclose key information to the market.
The Federal Court accepted the applicants’ claims in part and concluded Brambles engaged in misleading or deceptive conduct as it had made representations regarding future matters “for which it lacked reasonable grounds”.
While dismissing several claims, the Federal Court upheld points relating to underlying profit growth for the period between 16 November 2016 and 21 December 2016 and relating to underlying profit growth and sales revenue growth for the period between 21 December 2016 and 23 January 2017.
It also concluded eligible Brambles’ shareholders are entitled to compensation.
“Brambles is reviewing the lengthy decision of over 1200 pages to assess its position, including the various grounds of appeal that may be open to Brambles,” the company said in an ASX statement.
“Whilst Brambles has insurance arrangements in place, Brambles notes that the total quantum of the potential damages is currently uncertain and will not be known until the process for quantification of total damages has been completed and/or all avenues for appeal by either Brambles or the applicants are exhausted.
“As a result, it is not possible at this stage to determine the financial impact of the judgment on Brambles, if any.”
Slater and Gordon principal lawyer Victoria Sparks said the result represented a victory for group members.
“This is a strong and hard-fought outcome that provides justice for the applicants and class members,” Ms Sparks said.
“These claims alleged that the market was not properly informed about Brambles’ financial position and outlook, particularly in the lead up to its FY17 downgrade announcements.
“The Federal Court accepted the applicants’ claims in part and has awarded compensation for the recovery of loss or damage caused by Brambles’ lack of timely disclosure of information.”