Rebecca felt hopeless before she joined a class action – Sydney Morning Herald

Ms Oates and Jan Saddler, who is leading the class action for law firm Shine Lawyers, where she is head of litigation, said they did not want the laws changed. Several litigation funders and class action law firms are behind a new campaign called “Keep Corporations Honest” that will lobby for the industry.
Liberal MP Jason Falinski, who is on the inquiry, said it was established to learn more about the rapidly growing litigation funding industry, which backs about three-quarters of class actions.
“There is a view that it has got out of control,” Mr Falinski said. “Weve got people treating the justice system as a profit centre and another investment opportunity. Were worried this is leading to vexatious litigation rather than the pursuit of justice.”
He pointed to the percentage of payouts to class action members that law firms and litigation funders take in return for their services and some funders’ decisions to base themselves in low-tax offshore jurisdictions as being among topics the committee will examine.
Litigation funders typically take between 25 and 40 per cent of the money a court awards to the plaintiffs, which the funds say is proportionate to the risk they take on by supporting court cases they might lose, though most back only the cases they believe will be successful.
Lawyers’ fees are an additional cost for plaintiffs.
Without the class action, Ms Oates said she could never have challenged Johnson & Johnson. While many class actions fit the traditional mould, relating to faulty products and wage underpayment, about 30 per cent are run on behalf of shareholders in companies that have lost value.
The government is yet to respond to a major report into class actions by the Australian Law Reform Commission delivered in January last year.
“[Big companies] havent got the answer they want so theyre demanding the government keep having inquiries,” Ms Saddler said, pointing to other inquiries that preceded the commission’s report.
Mr Falinski said that was “just not true”. Labor has opposed the inquiry, arguing it favours big business.
The Victorian state Labor government recently passed laws allowing firms to take a percentage cut of winnings rather than charging normal fees if they fund class actions on their own. The Morrison government has put licensing conditions on litigation funders and moved to shield boards from class actions during the coronavirus pandemic.
The Johnson & Johnson class action is not backed by a litigation funder. The company has broadly denied the allegations against it and is appealing against Justice Katzmann’s ruling.

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