Brambles Limited, the parent company of CHEP, is reviewing its legal options following a Federal Court of Australia judgment in a long-running shareholder class action tied to the company’s FY17 earnings guidance.
The decision, handed down in April 2026, after a 2022 trial, addresses claims that Brambles misled investors and breached continuous disclosure obligations during a defined period between August 2016 and February 2017.
While the Court upheld certain allegations, it also dismissed a substantial portion of the claims, narrowing the scope of potential liability.
According to Brambles’ ASX filing, the Court’s findings were mixed across the timeline in question. Claims were dismissed for several periods, including early stages of the claim window and portions of January–February 2017. However, the Court upheld specific allegations relating to underlying profit growth guidance and, for a shorter period, revenue growth guidance.
In particular, the Court found that certain representations regarding FY17 performance lacked a reasonable basis during parts of November 2016 through January 2017. Other allegations, including those tied to longer-term FY19 targets, were dismissed in full.
The case centered on whether Brambles should have updated or withdrawn its market guidance sooner as conditions changed, particularly in its U.S. pallet operations.
The class action was brought on behalf of shareholders who acquired Brambles shares between August 18, 2016, and February 17, 2017.
Applicants alleged that the company:
- Provided earnings guidance without reasonable grounds
- Failed to update the market in a timely manner
- Caused investors to purchase shares at inflated prices
Brambles denied these allegations and defended the proceedings, which were heard over a five-week trial in 2022.
Company Response: Appeal Under Consideration
In its April 13 ASX and media release, Brambles emphasized that the judgment is still under review and that the financial implications remain uncertain.
“Brambles is reviewing the lengthy decision of over 1,200 pages to assess its position, including the various grounds of appeal that may be open to Brambles,” the company stated.
The company also noted that any estimate of damages at this stage would be premature.
“[T]he total quantum of the potential damages is currently uncertain and will not be known until the process for quantification of total damages has been completed and/or all avenues for appeal… are exhausted.”
Brambles added that insurance arrangements are in place, though it is not yet possible to determine the ultimate financial impact.
Damages Phase Still Ahead
Importantly, the ruling does not determine compensation amounts. That process will follow and could involve a complex assessment of share price impacts over specific trading windows.
Legal observers have pointed to the Court’s detailed approach in attributing portions of share price movement to the alleged conduct, which could shape how damages are calculated.
Estimates reported in financial media suggest potential exposure in excess of $100 million, though those figures remain speculative pending formal quantification and any appeal.
For Brambles, the immediate focus is on reviewing the judgment and determining next steps. “Brambles will keep the market informed in accordance with its disclosure obligations,” the company said in its release.
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Rick LeBlanc, EMBA, is the founder and editor of Reusable Packaging News (subscribe to the free newsletter) and editor of Western Pallet Magazine. A supply chain journalist with more than 30 years of experience, he specializes in pallets, reusable packaging, material handling and related operations. Rick is co-author of Pallets: A North American Perspective and Pallets & Progress: A Collected History of Pallets and Palletized Handling 1922–1945. He is also an advisory board member of the Virginia Tech Center for Packaging and Unit Load Design. Read Rick’s full bio.
