TWE settles $49m class action
Treasury Wine Estates (TWE) has reached an agreement to settle a shareholder class action, which was commenced in July 2014.
The action related to historical market disclosures in 2013 and was brought by Brian Jones, who was represented by Maurice Blackburn. The action concerned TWE’s announcement in 2013 that it was expected to write-down $160m as a result of excess stock being held by distribution partners in the US.
That included a $33m provision to pour six million bottles of out of date wine down the drain. The action claimed that TWE had misled the market and breached its continuous disclosure obligations.
In a statement about the settlement, TWE said: “The settlement amount, $49m inclusive of interest and costs, is fully insured and will have no impact on the company’s financial results.
“The agreement to settle was a commercial decision made in the best interests of TWE shareholders to enable to company to remain focused on executing against its strategy without the distraction and expense of legal proceeding.”
The settlement is without any admission of liability from TWE and is also subject to Federal Court approval.