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Shareholder class actions in Australia



With the assistance of litigation funding company IMF, a record-setting settlement was just obtained from a defendant firm named Aristocrat over misleading reports of sales of gambling machines. But Australian Shareholders' Association chief executive Stuart Wilson details the loser-pays difference:

There are two main reasons why we will not follow the US's lead in relation to frivolous shareholder actions. The first is that in Australia, costs can be awarded against the plaintiff, and are paid by the funder. In addition, IMF is highly conservative in its assessment of what prospective cases will cost, whether shareholders will win, and the amount of any settlement or judgment. With the risk of having to pay costs, only the strongest cases are considered.

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Rafael Mangual
Project Manager,
Legal Policy
rmangual@manhattan-institute.org

Katherine Lazarski
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.