This was a shareholder class action against failed private education and training provider Vocation Ltd (in liq) (Vocation), its former auditor (PricewaterhouseCoopers) and its former CEO (Mr Hutchinson), CFO (Mr Gréwal) and Chairperson (Mr Dawkins). Vocation’s former lawyers (Johnson Winter & Slattery) and certain of its former non-executive directors were also joined to the proceeding as cross-respondents. The proceeding was a consolidated proceeding jointly conducted by Maurice Blackburn, with funding from International Litigation Funding Partners Pte Ltd (ILFP), and Slater & Gordon, with funding from Omni Bridgeway Ltd (OBL).
In this judgment, Anastassiou J approved a settlement of the proceeding in the amount of $50 million, to be distributed as follows:
$20,000 for the applicant’s reimbursement payment;
~$158,000 for estimated settlement administration costs and disbursements;
$10.9 million in total funding commission (~21.8% of the settlement sum), comprised of $6.5 million to OBL and $4.4 million to ILFP (after the application of a funding equalisation order). His Honour observed that “as a matter of logic, if the two commissions are reasonable in aggregate that rather suggests there is no mischief in having two litigation funders” (at ). However, his Honour also said that that reasoning does not exclude the possibility that the funding commission and legal costs “might have been materially lower had there been but one litigation funder and one law firm” (at ). Ultimately, his Honour concluded that it was “too late at this stage to, in effect, second guess those charged with conducting the litigation from its inception, or at least from the point in time of the two proceedings being consolidated” and found that the aggregate funding commission was reasonable in the circumstances (at );
$12.8 million in total legal fees and disbursements (~25.6% of the settlement sum), comprised of $5.2 million to Slater & Gordon and $7.6 million to Maurice Blackburn. In approving those costs, his Honour said that “though the quantum of the costs of each of the law firms is very substantial, they are not disproportionate to the settlement that has been achieved, having regard to the complexity of the proceeding and the independent assessment of [the Court-appointed special costs referee] Ms Dealehr” (at ); and
$26.2 million to class members (~52.3% of the settlement sum).
Federal Court of Australia, Anastassiou J,
23 July 2021
Applicant’s Solicitors: Maurice Blackburn and Slater & Gordon;
Respondents’ and Cross-Respondents’ Solicitors: Gilbert + Tobin (Vocation and Mr Hutchinson), Herbert Smith Freehills (PwC), Clyde & Co (Mr Gréwal), Baker & McKenzie (Mr Dawkins), Allen & Overy (Mr Tucker, Ms Tredenick and Mr Halley) and MinterEllison (JWS);
Applicant’s Funder: International Litigation Funding Partners Pte Ltd (Maurice Blackburn clients) and Omni Bridgeway Ltd (Slater & Gordon clients)
Austlii Link: Accessible here
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