Class closure - participants still need to register or miss out

With some institutional investors leaving things late before participating, this ruling – and the class closure rulings in the QBE shareholder class action – demonstrates that participants will be prevented from sharing in any eventual settlement if they don’t register in accordance with the court orders.

This is a securities class action arising out of guidance given by the respondent (and later withdrawn) as to its expected profit for the 2017 financial year. Shortly after the proceeding was commenced (and before any defence was filed) both parties jointly sought, in aid of an early mediation, orders for limited discovery, opt out and a 'soft' class closure. After some amendments were made to the proposed orders (at the request of the Court), Moshinsky J made the proposed orders, and in this judgment gave brief reasons for doing so.

The orders provide, in effect, that any class members who do not register prior to the registration deadline will not be entitled to participate in any settlement reached at the forthcoming mediation, or any settlement reached within six months after that mediation, but will still be entitled to participate in any settlement reached at a later time, or in any judgment in the proceeding. His Honour was satisfied that he had power to make such an order, consistent with the decision of the Full Court in Melbourne City Investments Pty Ltd v Treasury Wine Estates Ltd (2017) 252 FCR 1; [2017] FCAFC 98.

The concerns which his Honour had with the original form of the proposed orders included:

  • that the period of four weeks between distribution of notices to class members and the deadline for registration / opt out was too short – in the final version of the orders that period was increased to two months
  • that the notice to class members did not sufficiently set out the consequences of a class member 'doing nothing' (i.e. neither opting out nor registering before the deadline) – accordingly, amendments were made to the notice in the final version of the orders.

Case details

Fisher (Trustee of the Tramik Super Fund Trust) v Vocus Group Ltd [2019] FCA 712

  • Federal Court of Australia, Moshinsky J, 21 May 2019
  • Applicant's Solicitors: Slater & Gordon
  • Respondent's Solicitors: Herbert Smith Freehills
  • Applicant's Funder: Investor Claim Partners Pty Ltd / ICP Capital Pty Ltd / Woodsford Litigation Funding Ltd

Read more on Austlii: Fisher (Trustee of the Tramik Super Fund Trust) v Vocus Group Ltd [2019] FCA 712

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