An Evidence Based Approach to Class Action Reform in Australia

In late January 2019, Professor Morabito published his latest empirical paper on the class actions regime. The paper, published in response to the ALRC’s recent report on class action proceedings and litigation funding, focused on three main areas – Funding Fees, Common Fund Orders and Reimbursement Payments

Professor Morabito's headline conclusions in respect of Funding Fees were as follows:

  • for funded class actions, the median percentage deduction from the gross settlement sum for a funder is approximately 25% (in contrast to the figure of 31% cited by the ALRC in its report)
  • in approximately two thirds of funded class actions, after deductions for legal and funding costs, group members received in excess of 50% of the gross recovery, and funding fees comprised more than 40% of the gross recovery in less than 5% of cases.

In respect of Common Fund Orders, Professor Morabito concluded that:

  • in many cases where a common fund order has been made, the percentage amount of the common fund (of the gross settlement) has been less than the historical median for funding fees
  • common fund orders made in competing class actions (citing the BHP and GetSwift proceedings) have 'worked particularly well'.

As to reimbursement payments to lead representatives, subgroup representatives and sample group members, Professor Morabito observed that:

  • in recent years Supreme Courts have begun to follow the Federal Court's practice in making reimbursement payment orders
  • a total of approximately $2.6 million in reimbursement payments have been made in 61 class actions to a total of 114 persons, at an average of approximately $23,000 per recipient.

Andrew Watson

National Head of Class Actions, Class actions, Melbourne

"I'm an experienced litigator in class actions, particularly for shareholders who have been victims of corporate misconduct."

Ben Slade

State Managing Principal, Office Leader, Class actions, Sydney

"I am driven to give a voice to those who would otherwise have to suffer because those who have done them wrong are all too powerful."

Kimi Nishimura

Principal Lawyer, Class actions, Melbourne

"I'm committed to fighting for the rights of victims of corporate misconduct as well as pursuing compensation on behalf of my clients."

Rebecca Gilsenan

Executive Director, Principal Lawyer, Class actions, Sydney

"I have extensive experience in running complex and novel litigation, including class actions in the areas of price fixing, failed investment schemes, product liability and securities."

Miranda Nagy

Principal Lawyer, Class actions, Sydney

"I have a strong conviction that the community should be able to expect our governments and the companies we deal with to comply with the law."

Julian Schimmel

Principal Lawyer, Class actions, Sydney

"Class actions are a unique legal mechanism that have helped hundreds of thousands of people receive compensation after mistreatment at the hands of powerful companies, and it’s gratifying to help people get access to justice when otherwise it would’ve been difficult for them."

Vavaa Mawuli

Principal, Class actions, Brisbane

"The most rewarding thing about my work is the change in scale of what we are able to accomplish."

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