In Australia, the value of securities class actions led by litigation funder IMF has tripled since 2007, increasing from $400 million in 2007 to more than $1.2 billion at the end of 2008. The Australian reports that IMF now has seven securities actions under way: Sons of Gwalia, Ion, Aircargo, Centro, Westpoint, AM Corporation and Opes Prime.
In addition, there are six other “possibles”: ABC Learning, Oz Minerals, FKP, Allco, Firepower and Octavier.
IMF’s Hugh McLernon told The Australian that “The total losses [in active cases] would be in excess of $3 billion, but we report them at around a third of that figure because most of the companies are under or will become under external administration and will only be able to pay around a third of the losses.” In Australia, litigation funders such as IMF bear all the costs of a case in return for a share of damages awarded — usually about 40%. McLernon also stated that the environment for class actions over the next year or so is “spectacular.”
Read the article in The Australian
