From market close on 19 October 2022 when Medibank went into a trading halt, to 26 October 2022 when the suspension was lifted, Medibank’s share price dropped more than 18 per cent after details of the breach were released.

Phi Finney McDonald’s class action alleges that Medibank engaged in misleading and deceptive conduct and breached its continuous disclosure obligations in relation to the adequacy of its privacy and information security protections.

The class action seeks compensation for shareholders that suffered losses as a result of Medibank’s alleged disclosure failures. It is separate to the privacy litigation brought by Medibank customers whose personal and health information was breached.

Cameron Myers, Principal Lawyer at Phi Finney McDonald, said that following a preliminary investigation the firm considers there are grounds for legal action against the health insurer.

“Medibank’s customers and shareholders quite rightly expected the company, as one of Australia’s largest private health insurers, to take adequate steps to protect the incredibly sensitive information that it held. Indeed, Medibank fostered this belief by informing the market that it had appropriate protections in place.”

“The market was clearly concerned about the distress and related impact on customers whose data had been accessed, and what that meant for company costs and revenue. Based on our preliminary investigations, we believe that Medibank shareholders are entitled to be compensated for losses suffered from the erosion of trust and confidence in Medibank once the true state of affairs was acutely exposed.”

Phi Finney McDonald is accepting registrations from shareholders that held Medibank shares at the close of trade on 25 October 2022 at medibankshareholders@phifinneymcdonald.com.