This article is from the Australian Property Journal archive
A FEDERAL Court judgement has temporarily cut off funding to the $220 million Wembley Stadium shareholder class action against Brookfield Multiplex.
Justice Ray Finkelstein yesterday ruled that Brookfield Multiplex lawyers could serve injunctions on two overseas litigation funders accused of operating an unregistered management investment scheme, effectively derailing the class action for the time being.
The injunctions restrain both funders, as well as class action lawyers Maurice Blackburn, from taking any steps in the advancement of funding agreements.
The judge said Brookfield Multiplex lawyers had shown enough to justify an order for injunctions to be served outside of Australia.
The injunctions followed Monday’s revelation that the two class action funders, one based in Singapore and the other in Ontario, Canada, may have contravened the Corporations Act by operating a managed investment scheme while not being registered to carry on business in Australia.
In yesterday’s judgement Justice Finkelstein said Brookfield Multiplex had brought the action to stop the funding, which they contended was illegal.
The judge said investors who joined the class action had agreed to pay any money they received into a common account maintained by Maurice Blackburn, from which payments were to be made in accordance with relevant funding agreements.
He said the funders had agreed to meet Maurice Blackburn’s fees and any costs awarded against investors, with Maurice Blackburn’s fees only to be recovered from the funder.
Justice Finkelstein said it was alleged this arrangement constituted a managed investment scheme which was required to be, but was not, registered under the Corporations Act.
He said, however, there was nothing straightforward about any of the allegations.
What was involved in large measure was the construction of the definition for a managed investment scheme and how that construction should be applied to the facts, most of which would not be in dispute.
Australian Property Journal
