Wine producer agrees to cough up millions

Treasury Wine Estates, which owns brands including Penfolds and Seppelt, has just suffered a legal whopping.

A $65 million settlement has been reached between Slater and Gordon Lawyers, Maurice Blackburn Lawyers and Treasury Wine Estates on behalf of shareholders who sustained losses due to Treasury’s conduct when it downgraded its forecast earnings for 2020.

The plaintiffs alleged that Treasury had engaged in misleading or deceptive conduct in breach of Australian Consumer Law and breached its continuous disclosure obligations under the ASX Listing Rules.

Slater and Gordon and Maurice Blackburn filed class actions against Treasury in relation to that contravening conduct that were consolidated in late 2020 and have since then jointly represented the joint plaintiffs, and investors, who lost money when Treasury downgraded its earnings guidance for 2020 on January 28, 2020.

The class action alleged Treasury engaged in misleading or deceptive conduct and breached its continuous disclosure obligations based on the earnings guidance it provided the market in 2018 and 2019.

A seven-week trial was due to commence this week before Justice Waller in Victoria’s Supreme Court, to consider those issues and ultimately determine Treasury’s liability to affected Treasury shareholders.

Slater and Gordon’s lead plaintiff Brett Stallard said he was “pleased that a settlement had been reached on behalf of investors who lost money as a result of result of Treasury’s earnings downgrade in 2020”.

Slater and Gordon Class Actions Principal Lawyer Mitchell Coidan said: “We are pleased to have been able to reach this outcome for group members on the eve of a trial listed for seven weeks, following hard-fought litigation with Treasury.

"The outcome means that group members who sustained losses as a result of Treasury’s allegedly contravening conduct, will receive compensation in the short term. We are glad to have achieved this result for affected group members, without the need for a protracted court process.”

The settlement remains subject to court approval and Treasury has made no admission of liability.