Mining services firm WorleyParsons (WOR) is set to face a class action suit over allegations it withheld sensitive market information ahead of a 26% fall in its share price in November 2013.
In a statement today, ACA Lawyers announced it had obtained funding to mount a class action against the group.
The firm said it is currently completing due diligence on the action and expects to file a statement of claim on behalf of shareholders in the Federal Court before the end of the year.
In August 2013, WorleyParsons' annual report included guidance advising earnings were expected increase in the year ahead. However, the group flagged an earnings downgrade in November, after reiterating its forecast for an earnings increase at its October AGM.
ACA Lawyers principal Craig Allsopp said this is yet another example of a major public firm "happy to spruik the good news but sweep the bad news under the carpet".
"The class action will allege that WorleyParsons shareholders suffered significant losses after the company failed to comply with its continuous disclosure obligations and engaged in misleading and deceptive conduct," Mr Allsopp said.
"The class action will seek compensatory damages on behalf of WorleyParsons shareholders who acquired shares between August 14, 2013 and November 19, 2013."
Shareholders will allege WorleyParsons had information by at least August 14, 2013 that deteriorating market conditions and project delays would materially impact its profitability in the financial year ending June 30, 2014.