Thousands of shareholders who took part in a class-action lawsuit against property trust GPT Management Holdings have walked away with $75 million after a five-year battle against the company.
The property industry has been focused on the case for some time, but it is only one of several property conflicts that have been eagerly watched this year.
The class-action began in late 2011, led by Slater & Gordon. The action concerned a 2008 statement made by GPT to the ASX, in which the company downgraded its forecast earnings by 27%. Only six months beforehand, the company said its earnings would be “flat”.
Class action lawyer Ben Phi said in a statement the settlement was “great news” for shareholders.
“The settlement provides a strong return on the losses claimed and reflects the strength of the evidence presented at trial.”
GPT also said in a statement it was “pleased” the matter had been settled. The company also maintained it complied with 2008 disclosure requirements and said the full cost associated with the case and settlement is not material.
The company’s share price fell significantly after it downgraded its earnings in 2008. Shareholders argued the company knew it faced “material and substantial risks that it failed to disclose”.
However, Phi said in Slater & Gordon’s statement the settlement “reflects the strength of the evidence presented at trial”.
Slater & Gordon said it will contact those who have registered for the class-action in the next few days.
GPT was one of many companies which suffered during the global financial crisis. However, unlike other investment companies which failed to improve, the GPT Group has managed to maintain a solid position in the market.