The claim relates to LendLease’s market announcements on 9 November 2018 and 25 February 2019 in which it disclosed a catastrophic underperformance in its engineering division.

The class action has attracted significant levels of support from sophisticated institutional investors from Australia and abroad, including the prominent Teacher Retirement System of Texas which has AU$220bn in assets under management.

The class action will benefit all investors that acquired LendLease securities between 17 October 2017 to 25 February 2019. It covers both stapled securities listed on the ASX and American Depositary Receipts.

On 9 November 2018, LendLease announced that it would need to write-off $350m because of underperforming projects in its engineering division. This was despite the company’s previous assurances that the issues within that division had been dealt with. The company’s share price fell 27% in the three days following the announcement.

On 25 February 2019, LendLease disclosed additional problems in its engineering division when releasing its half-year results. The share price fell a further 10% over the following days.

Investors will allege that LendLease breached its disclosure obligations by failing to inform the market of issues within its engineering division extending back to October 2017.

Phi Finney McDonald Managing Director, Ben Phi, said that the significant problems in LendLease’s engineering division came as a shock to investors. “For more than a year, LendLease had reassured investors that the storm was over, when in fact the worst was yet to come. Our clients allege that LendLease failed to keep them properly informed of the problems, and their gravity, over a prolonged period.”

Texas TRS Assistant General Counsel, Lane Arnold, said, “As a public pension fund, we wish to ensure that the interests of our nearly 1.6 million members are looked after, and that their assets are protected. To this end, our goal is that any litigation brought on behalf of our members is pursued efficiently. The litigation funding structure proposed by Phi Finney McDonald and Therium is innovative. We are aware of the existing class action but chose to join the Phi Finney McDonald and Therium group instead because, in our estimation, the innovative funding structure offered will result in lower funding commissions and higher net recoveries, which ultimately benefit our members.”

“LendLease is an ASX/100 company with thousands of mum and dad shareholders, as well as some of the largest superannuation funds in Australia,” Mr Phi said. “This class action seeks compensation for those shareholders who suffered loss and damage as a result of LendLease’s conduct.”

The class action is supported by Therium Litigation Finance, an international litigation funder with extensive experience in Australia, also funding shareholder class actions against the Commonwealth Bank of Australia, GetSwift and Spotless Holdings.

“The funding terms on offer are some of the most competitive we have seen in the Australian market and will ensure that the vast majority of recoveries are returned to group members,” Mr Phi said.

“Phi Finney McDonald is proud to, again, be driving innovation and competition in Australian class actions. We aim to bring meritorious claims against deserving defendants and prosecute those claims to the highest standards, while ensuring that our clients and group members receive the maximum possible return.”

The Principals of Phi Finney McDonald are amongst Australia’s leading class actions lawyers, having secured over half a billion dollars in settlements.

Phi Finney McDonald was awarded conduct of the GetSwift class action against in the first ‘carriage motion’ determined in Australian class action history, receiving praise from the Federal Court for having negotiated innovative litigation funding terms.