Waste management company Transpacific Industries Group Ltd
(ASX:TPI) could face a shareholder class action lawsuit over claims it engaged in misleading and deceptive conduct.
Law firm Maurice Blackburn and litigation funder IMF (Australia) allege that in 2008 the company failed to disclose information to investors regarding its earnings and forecasts and that shareholders subsequently suffered losses when TPI’s share price slumped.
The proposed claim will apply to some large institutional and professional investors who bought Transpacific shares between February 28, 2008 and February 16, 2009.
A number of undisclosed investors have already expressed interest in a class action.
Investors could seek damages from TPI relating to alleged misleading or deceptive conduct and breaches of the company’s continuous disclosure obligations.
Transpacific CEO Trevor Coonan has told the Australian Financial Review he has not yet received any threats of litigation.
Between August and November 2008, TPI forecast double-digit earnings before interest, tax, depreciation and amortisation growth for fiscal 2008. The company also announced in November that its business was near recession-proof.
But three months later, the company entered a five-month trading halt after its share price plunged from $2.90 to $1.80 – wiping over $300 million from its value.
Transpacific Industries posted a loss of $218.36 million for fiscal 2009.
