This was an application to approve a proposed settlement in a shareholder class action. In this judgment, Wigney J approved the settlement in the amount of $29.5 million, and also approved the following deductions from the settlement sum:
$5,461,430.45 in respect of legal costs to be reimbursed to the funder;
$798,085.19 in respect of an ATE insurance premium to be reimbursed to the funder;
$5,440,557.67 in respect of commission to be paid to the funder (pursuant to a funding equalisation order, and not a common fund order);
$3,022,684.49 in respect of unpaid legal costs to be paid to the applicant’s solicitors;
$241,123.95 in respect of settlement administration costs to be paid to the applicant’s solicitors; and
$10,000 in respect of a reimbursement payment to be paid to the applicant.
There were no objections by class members to the proposed settlement, although his Honour indicated that that was not determinative. His Honour described the total legal costs in the case as a “staggeringly large amount” (at ), but ultimately accepted the opinion of the Court-appointed costs referee. His Honour also had some initial misgivings about the funder receiving both a funding commission and reimbursement of its ATE insurance premium, but ultimately concluded that that was, in the circumstances, fair and reasonable in this case.
Lastly, his Honour indicated that although the total deductions amounted to just under 50% of the total settlement sum, that did not mean, in the circumstances of this case, that the settlement was not fair and reasonable.
Federal Court of Australia, Wigney J,
23 December 2022
Applicant’s Solicitors: William Roberts Lawyers
Respondent’s Solicitors: Herbert Smith Freehills
Applicant’s Funder: ICP Capital Pty Ltd / Investor Claim Partner Pty Ltd
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