As most public companies continue to get hammered, one company in Australia reports that earnings are surging. IMF (Australia) Ltd., the dominant class action litigation funder in Australia, told shareholders at its annual general meeting that net profit in fiscal 2009 was expected to come in at $20 million, following $17.16 million the prior year, according to ALB Legal News.
Class actions in Australia are growing in popularity and usage, and because there is no contingent fee model in Australia, IMF has emerged as the leading source of funding for these suits, including cases against Australian companies such as Opes Prime, Firepower and Centro Properties. Among IMF’s recent successes is the Aristocrat case (discussed here), in which it was awarded $37 million of the $144 million settlement (with the law firm Maurice Blackburn getting about $8.5 million of IMF’s take).
Law firm Mallesons Managing Partner Roger Forbes told ALB that he has noticed an “increase in instructions in regulatory investigations, class action work, and breaches of director duties, assets acquisition, and insolvency.” McCullough Roberts Partner Guy Humble agreed, stating that “We are now coming out of a period where parties were willing to let bygones be bygones because everybody was too busy making money. What is happening now is that the market is tightening, so what was once forgivable debt, parties are now interested in exploring their legal rights to collect”.