Shareholder Class Actions

Last year was unique for shareholder class actions, which generally account for at least 20% of all class actions filed but only 6 were filed throughout the course of 2024, two of which were consolidated. In addition to that, it wasn’t until August that we saw a traditional shareholder class action filed (i.e. an action against the company), the two filed in March were filed on behalf of shareholder but against a range of defendants including ASIC (a claim that was struck out late last year).1

While that is unusual in this space, it was not surprising given two decisions in late 20232 and a further decision in May last year,3 all of which were in favour of the company and clearly left plaintiff firms reconsidering how to approach shareholder actions.

Two of the decisions are under appeal so it is possible that we will see further developments in the space in 2025, but if 2024 is anything to go by we will likely see fewer actions than in previous years and potentially also a change in the approach to defendants.

We already saw one example of joining directors and third parties (in that case auditors4) to a proceeding and given the difficulties that the current decisions present for claims against the company we may see more of that in the coming years.