Robert Johnston
Johnson Winter Slattery, Sydney
Robert.Johnston@jws.com.au

Alexandra Haggerty
Johnson Winter Slattery, Sydney
Alexandra.Haggerty@jws.com.au

Zoe Said
Johnson Winter Slattery, Sydney
Zoe.Said@jws.com.au

Class actions on the rise but plaintiffs beware

The Australian class action landscape has continued to mature over the last 30-plus years and stands out as one of the more balanced, well-functioning and progressive regimes when compared to some others around the globe.

However, while the pace of court filings has increased (the 1,000th Federal Court class action claim was filed this year; the first 500 took 25 years, the second 500 took only eight years), the last two years have seen a significant change in dynamics.

Remarkably, the last ten cases which have gone all the way to judgment have seen verdicts for the defendants meaning big losses for the class action law firms, their clients and the litigation funders. This has put a ‘chill wind’ through the plaintiffs’ bar and in particular has made litigation funders far more cautious.

Is this a trend or just a lucky streak for defendants? Whatever it is, we cannot lose sight of the fact that in the last two years, there have still been 39 class actions which have settled before trial or judgment for over AU$2.5bn in settlement payments. It is not all doom and gloom for the plaintiffs.

In this article, we look at some of these cases, some of the reasons behind this recent phenomena, and what lessons can be learned.

In short, it seems defendants are being more careful to select cases they think they can successfully run to trial and win, relying on what is a very robust judicial system which, without juries and without punitive or treble damages etc, applies a rigorous legal analysis to the claims made.

Judgments favouring defendants: is a pattern emerging?

Over the past two years, across a variety of courts and categories of claims, sole judges hearing trials have been brave enough or disciplined enough to wade through the headline allegations, the large losses claimed by group members, the mountains of documents and the complex expert evidence to deliver well-reasoned, robust, almost black-letter law judgments.

They have found the plaintiffs have either not been able to prove, on the balance of probabilities, the allegations they have made against governments and corporate Australia or, even when finding wrongdoing, have found no causally connected losses.

The table below shows the variety of types of claims and the key reasons why those claims have failed.^[1]

Case	Subject matter	Reasoning
Torres Strait Islands climate change class action	The indigenous Torres Strait Islanders alleged that the government had failed to protect their communities from the impacts of climate change, such as rising sea levels and coastal erosion, through inadequate emissions targets and climate change adaptation measures such as seawalls.	Justice Wigney found the government owed no legal duty of care to protect Torres Strait Islanders from climate change impacts despite accepting the ‘climate change’ scientific evidence.
Quintis shareholder stock drop class action	A shareholder action against the former CEO and auditor EY alleging inflated financial reporting.	Justice Shariff found that the CEO and EY had engaged in misleading or deceptive conduct but dismissed the claim as the plaintiffs failed to prove any causally connected loss.
Commonwealth Bank of Australia (CBA): conflicted financial advice class action	The claimants alleged their financial advisers breached their fiduciary duties and permitted conflicts of interest in the provision of personal financial advice.	Justice Halley dismissed the class action, finding no breach of fiduciary duties by the financial advisers.
CBA: anti-money laundering shareholder stock drop class action	The shareholder plaintiffs had alleged failure by the bank to disclose its deficient money laundering compliance.	Justice Yates found no breach or failure by the bank and also no casually connected loss. The appeal court did find wrongdoing by the bank but upheld the trial judge’s finding that the applicants had not established any quantifiable loss.
Public Housing Demolition Group Proceeding	The plaintiff tenants claimed wrongdoing by the government in its decision to demolish public housing including in contravention of the Charter of Human Rights and Responsibilities Act 2006 (Vic).	Justice Richards dismissed the claim, determining that the government was not required to give group members an opportunity to be heard before making the decision to demolish and redevelop public housing.
General Motors dealership class action	GM dealerships sued GM alleging wrongdoing on the part of GM in unilaterally terminating aspects of their five-year dealership franchise agreements.	Justice Lisa Nichols held that GM Holden did not breach its agreements. The Court also found that in any event there was no consequential loss.
Bayer contraception class action	Over 1,400 women commenced a class action against Bayer, alleging its withdrawn contraceptive device Essure caused serious health complications, including chronic pain, heavy bleeding and, in some cases, hysterectomy, following a 2017 Therapeutic Goods Administration hazard alert.	Justice Keogh found that the plaintiffs failed to establish that the Essure device caused physical injury or was associated with a higher-than-normal incidence of chronic pelvic pain or abnormal uterine bleeding. Further, the device was neither defective nor possessed a safety defect. His Honour also accepted that Bayer had provided sufficient warnings and therefore had not breached its duty of care.
National Australia Bank financial adviser fees class action	The plaintiffs claimed the banks unlawfully charged super fund members adviser commission fees in breach of the trust deed and the superannuation legislation.	Justice Markovic dismissed the claims, finding that the AU$165m in commissions paid to members’ financial advisers did not constitute conflicted remuneration.
QLD Energy electricity class action	Over 47,000 Queensland electricity customers claimed the government-owned generators abused their market dominance between 2015 and 2021 by manipulating prices.	Justice Derrington found that the two energy companies did not take advantage of their market power and conducted legitimate profit maximisation behaviour, which was not an unlawful purpose under the competition laws.
Roundup weedkiller class action	The class action alleged that glyphosate in Roundup weedkiller caused non-Hodgkin lymphoma and that its manufacturers were negligent in failing to warn of the risks.	Justice Lee dismissed the class action, determining that there was insufficient scientific evidence called as at the date of trial (accepting that there may be such evidence in the future) to prove on the balance if probabilities that the use of and exposure to Roundup increased an individual’s risk of, or caused, non-Hodgkin lymphoma.

Common themes in plaintiff losses

Some cases have seen plaintiffs fail to establish wrongdoing; some cases have succeeded on liability but failed on casually connected losses.

Australian courts have shown a marked reluctance to infer causation where expert or scientific evidence falls short of the requisite standard of proof.

In the Torres Strait Islanders climate change class action, Justice Wigney found that causation remained a substantial hurdle, with plaintiffs unable to demonstrate a direct causal link between alleged governmental omissions and the climate-related harms claimed.^[2] Claims for cultural loss also faced legal constraints, underscoring the evidentiary and doctrinal challenges for plaintiffs seeking remedies for non-economic harm in such contexts.

In the Roundup weedkiller class action, Justice Lee observed that although substantial evidence was adduced, the state of the scientific research as at the date of trial did not support the proposition that glyphosate exposure caused non-Hodgkin lymphoma.^[3] Similarly, in the Essure contraception class action, Justice Keogh found no liability where product warnings were comprehensive, and risks were addressed through appropriate clinical intermediaries. The decision also reinforced the view that Australian courts require robust epidemiological evidence to establish causation in medical device claims.

This pattern of judicial rigour extends to financial services and shareholder proceedings. Even where elements of misleading or deceptive conduct or statutory breach were established, claims ultimately failed because plaintiffs could not prove that the contraventions caused any measurable loss. This was exemplified in the Quintis shareholder class action, which continues a broader trend of unsuccessful shareholder proceedings. All six recent shareholder class actions to proceed to trial (over a longer period) – Quintis, CBA, Crowley, Insignia, Iluka and Myer – have been determined unfavourably for plaintiffs, each failing on the basis that loss was not established.

An increasingly exacting judicial approach

These judgments reflect an increasingly rigorous judicial approach to questions of breach and causation, particularly in matters involving complex scientific, economic or market-based evidence. This evidentiary discipline has been decisive in producing a series of complete defence outcomes. There has also been a focus by judges on the actual pleaded case brought, rather than ones which may have succeeded. This has often revealed shortcomings in early filings of ill-thought-out, rushed, and insufficiently researched and formulated claims.

Implications for litigation strategy

While each matter turns on its own facts and does not, of itself, signal a systemic reduction in litigation risk, the recent sequence of defence successes is likely to influence strategic considerations on both sides.

These recent victories for defendants are encouraging corporate Australia to review the cases in which they are involved carefully and, if they can select the right ones, be brave enough to go to trial. Part of that strategy is also resulting in cases settling much later, often on the eve of trial, as defendants seek to worry plaintiffs that theirs is the case which will go all the way and so risk a significant loss.

For plaintiffs and funders, higher-risk cases are being turned away as they have less risk appetite, even where there is obvious egregious conduct by defendants. It is also taking much longer for plaintiffs to carefully formulate claims and to collect the right expert evidence before filing; it is also taking funders a lot longer to agree to fund claims. This will have a short-term impact on slowing the number of claims being filed.

Strategic settlements: recent court approvals

Despite these trends in favour of defendants, the fact is that in this time (2024–2025) there have also been over AU$2.5bn worth of settlements approved in 39 class actions. Some of the significant settlements are dealt with below.

Junior doctors

There are a significant number of class actions for recovery of underpayments for junior doctors. These include unpaid overtime, breaks and superannuation entitlements. There have been a variety of actions filed in various Australian states, most of which have now been settled. The settlement amounts include AU$229.8m in New South Wales, AU$175m in Victoria, and AU$25.34mi in the Australian Capital Territory.

Consumer law settlements

There were a number of settlements related to misleading representations about worthless add-on insurances in the motor vehicle and financial services spaces. In one case the court approved a settlement of over $200m. There are more of these types of cases currently before the courts so we may see larger settlements in the not-too-distant future.

Further, Hino Motor Sales recently settled a class action related to misrepresentations that their vehicles met Australian emissions and road standards over a 20-year period. Hino was accused of falsifying data on fuel efficiency and emissions testing to secure vehicle certification in Japan and Australia as early as 2016. The class action settled for AU$87m in the Victorian Supreme Court.

Uber taxi driver claims

A class action was brought against Uber ridesharing for what was alleged to be its unlawful disruptor new business strategies. The class action alleged that Uber Australia and its parent companies knowingly operated illegally and therefore gained an advantage over taxi and hire car drivers who were complying with Australian licensing laws. Uber files released in 2022 revealed that Uber used similar strategies in nearly 30 countries to establish itself in those markets. The case was fought all the way to the courthouse steps and was settled on the eve of the three-month trial. The settlement for AU$271m was the fifth largest class action settlement in Australia.

Robodebt scheme class action

This class action involved a government programme to recover social security payments from Australians using a knowingly defective algorithm (with many similar attributes and outcomes as seen in the UK Postal Service scandal seeking to recover monies from local postmasters). The original case was settled and approved in 2021 for AU$112m. However, after a Royal Commission some two years later, which uncovered even more egregious conduct by the government in unjustifiably collecting over $1.7bn in social security payments from 403,000 Australians, the appeals court allowed the settlement to be reopened. The new settlement recently announced (but not yet court-approved) has resulted in the largest class action settlement in Australia’s history – over AU$500m – on the basis that the initial outcome was inadequate and group members were entitled to additional compensation.

Conclusion

Australia’s class action regime remains one of the most accessible in the world, yet the recent spate of judgments favouring defendants underscores that success at trial is far from guaranteed.

While filing rates remain strong and there are still many class actions which settle for significant amounts, the courts’ stringent approach to causation – and insistence on clear and compelling expert testimony – imposes a genuine discipline on both claim formulation and litigation strategy. This balance between broad access to justice and robust judicial analysis will continue to shape both the volume and character of class actions in the years ahead.