The approval of the first-of-its-kind settlement lies in the Victorian Supreme Court's hands
Slater and Gordon Lawyers has helped to secure what could be a landmark settlement if approved by the Victorian Supreme Court.
The firm reached a $46.5m settlement with G8 Education Ltd (G8) on behalf off shareholders who incurred losses following the company's downgrade of its forecast earnings for 2017. According to Slater and Gordon, this is anticipated to be the first group proceeding in Victoria in which legal costs will be determined as a percentage of the settlement amount.
The class action against G8 was initiated by Slater and Gordon in late 2020. It addressed the financial impacts on investors after G8 released an updated earnings guidance announced on 4 December 2017 and after the company publicised its actual 2017 earnings on 26 February 2018.
The claim accused G8 of misleading or deceptive conduct and failing to adhere to its continuous disclosure obligations, referencing the financial guidance provided on 23 May 2017 and 21 August 2017. The case also introduced the concept of a “contingency fee” class action in Victoria, according to Slater and Gordon.
Justice Lisa Nichols issued a 'group costs order' at 27.5% on 26 November 2021 in a first. The order allows for the legal expenses of the lead plaintiffs and group members to be calculated as a percentage of the settlement or award.
The suit was scheduled for a trial in three weeks before Justice Michael Osborne in the Victorian Supreme Court; Slater and Gordon class actions senior associate Kathryn Browne indicated that the trial “was expected to last seven weeks or more”.
Lead plaintiffs Paul and Monika Allen expressed their approval of the settlement, stating that, “all companies listed on the ASX should comply with their duties and obligations to disclose information that is material to the market”.
The settlement awaits requires court approval, though it comes with no admission of liability from G8.
