SYDNEY – Law firm Slater & Gordon Ltd said on Thursday it was preparing a class action lawsuit against Australian surfwear company Billabong International Ltd over alleged misleading conduct in information disclosure.
The law firm said in a statement it would seek compensation from Billabong on behalf of its shareholders, alleging the company gave earnings guidance for 2012 financial year that lacked reasonable grounds.
Billabong said in a filing to the Australian Securities Exchange that it had not been contacted by the law firm or been served any proceedings.
Billabong forecast on August 19, 2011 that it would achieve strong earnings growth in finiancial year 2012, but it withdrew the guidance a few months later and said the earnings would suffer a substantial fall, sending Billabong shares down over 50 percent in the following days, Slater & Gordon said.
"Our clients allege that Billabong misrepresented the assumptions on which the FY12 earnings growth guidance was based," said the law firm's senior associate Odette McDonald.
Billabong said it would "vigorously defend" the claims.
(Reporting by Maggie Lu Yueyang; Editing by Jeremy Laurence)