- Class action risk has increased significantly over the course of the past decade. However, a closer analysis of the data reveals that the number of companies facing class actions has fallen.
- The key driver for the increased filings is the number of ‘new’ law firms that have commenced class actions.
- There has been a recent spike in shareholder class actions, but longer-term trends suggest that banks and financial services companies are the most frequent targets.
Class actions have featured frequently in the press in recent years, often with a theme of a developing crisis for Australian business. In part, this attention has been driven by the fact that class action activity has significantly increased.
The increase in filings is, however, only one part of the equation – a proper assessment of class action risk requires looking behind the hype and the raw numbers.
To facilitate a more holistic assessment of class action risk, we have analysed class actions filings over more than a decade. This data allows us to identify the enduring trends through a series of five year on five year comparisons, and also to identify the newly emerging trends.
This article provides a snapshot of our findings on the current class action landscape and also identifies some of the potential agents for change in the short to medium term.