Downer Class Action
Piper Alderman filed a class action in the Federal Court of Australia on behalf of shareholders who acquired Downer EDI Ltd (Downer EDI) shares or an interest in Downer EDI shares between 1 April 2020 and 27 February 2023 inclusive (Relevant Period).
Downer EDI is an Australian public company listed on the Australian Securities Exchange under ticker code ‘DOW’ (ISIN: AU000000DOW2). During the Relevant Period, Downer EDI operated a business providing, inter alia, integrated services to customers in Australia and New Zealand including the design, build and maintenance of assets, infrastructure, and facilities across a range of sectors.
In late 8 December 2022, Downer EDI published an ASX announcement that it had issues with the reporting of revenue and work-in-progress, as well as disclosing that it was unlikely to meet its profit guidance. After release of this announcement, Downer EDI’s share price fell by approximately 20%. On 27 February 2023, following the release of their half-yearly accounts which in part dealt with the effects of the financial misreporting, Downer EDI’s share price fell by a further 24%.
The claim alleges that:
- Downer EDI was aware of information concerning the accounting irregularities earlier than 8 December and failed to disclose that information to the market;
- Downer EDI historically misrepresented the true state of its financial position; and
- until 8 December 2022 and 27 February 2023, Downer EDI’s shares traded at an artificially inflated price.
Status of the Proceedings
By July 2023, another three competing class actions had been filed overlapping with the above claim . Two were commenced in the Federal Court of Australia and another in the Supreme Court of Victoria. On 7 August 2023, the claim filed by Piper Alderman and the two subsequent Federal Court proceedings were transferred to the Supreme Court of Victoria by consent. On 28 August 2023, there was a hearing before the Honourable Justice Delany to resolve which class action should proceed.
At the commencement of the hearing, the claims initiated by Piper Alderman and William Roberts were consolidated with the proceeding Justice Lidgett and Cameron Lidgett v Downer EDI Limited (S ECI 2023 01835) (Consolidated Proceeding). By order of the Court on 6 October 2023, the Consolidated Proceeding was granted carriage of the relevant claim against Downer EDI and the competing action was stayed. Maurice Blackburn will primarily have conduct of the Consolidated Proceeding. If you are interested in joining the Consolidated Proceeding, please click here.
A copy of the Supreme Court of Victoria decision in Jowene Pty Ltd v Downer EDI Ltd  VSC 574 is available here.
A copy of the Honourable Justice Delany’s orders of 6 October 2023 made in the Supreme Court of Victoria is available here.