WiseTech faces fresh scandal as shareholders lodge class action over profit downgrade

Australia’s biggest listed technology company Wisetech Global says it will “vigorously defend” a shareholder class action centred around earnings forecast it made five years ago.

Launched in the Supreme Court of Victoria by law firm Phi Finney McDonald, the case alleges WiseTech breached its continuous disclosure obligations and engaged in misleading conduct.

The firm claims WiseTech’s fiscal 2020 guidance — provided in August 21, 2019 and reaffirmed in October and November that year — was done “without reasonable grounds”.

The guidance was revised down on February 19, 2020 and triggered a 27 per cent decline in the share price. It declined another 11 per cent the following day.

“The class action alleges that investors who acquired WiseTech shares during the claim period are entitled to compensation for loss and damage as they paid more for those shares than they ought to have paid as a consequence of WiseTech’s conduct,” Phi Finney McDonald said on Wednesday.

“The class action also alleges that some group members would not have purchased WiseTech shares if WiseTech had complied with its obligations.”

In a brief statement to the Australian Securities Exchange, WiseTech said it had not been served with any originating process in respect of the class action proceedings.

It said it “intends to vigorously defend any such proceedings if they are served”.

The class action comes just weeks after WiseTech chief executive Richard White stepped down from the company he founded 30 years ago following damning allegations about his personal life.

These allegations involved Mr White having affairs with women and buying homes for some of them.

Mr White has also stepped down from the board of lobby group Tech Council Australia, which copped criticism for its “glacial” response to his alleged inappropriate behaviour.