(SMH) - Treasury Wine Estates' (TWE) shareholders have begun legal action against the global winemaker and distributor for allegedly breaching disclosure obligations over writedowns.

The class action is being led by Melbourne City Investments and involves an unspecified number of shareholders.

The shareholders allege that Treasury Wines misled the market and breached its continuous disclosure obligations in relation to the financial impact of over-stocked US distributors which it announced to the market on July 15.

Litigation funder IMF and Maurice Blackburn lawyers announced funding for the class action last week.

In a statement Treasury Wine Estates, which owns the Penfolds and Wolf Blass brands, said it will vigorously defend the proceedings and it denies "any and all allegations of wrongdoing".

On July 15, 2013 TWE announced up to $160 million in writedowns as a result of excess stock being held by US distributors.

The impairment included a $33 million provision to destroy six million bottles of out-of-date wine.