The massive scale of the class action could give IMF between 20 per cent and 30 per cent of the expected $500 million in damages and financial settlements.
The Australian newspaper reports today that IMG expects to spend up to $1m on preliminary investigations and up to $10m on legal costs if the case goes to a full hearing.
The case will go ahead if IMF concludes that the number of claimants is economically viable. If the case is flawed, it will have no way of recovering its $1m.
Law firm Maurice Blackburn, which is backed by IMF, said recent the findings of a Flood Commission of Inquiry offer some hope.
The findings confirm what many people suspected: too much water was allowed to accumulate in Wivenhoe, and the strategy for water releases was botched. The dam operators did not release enough water early enough and that meant far too much was released later on. The operators failed to take account of rainfall forecasts at key times,” said Maurice Blackburn partner, Rod Hodgson.
The statements of three engineers were found to be false and they have been referred to the Crime and Misconduct Commission (CMC), the firm said.
Maurice Blackburn has represented victims of the disaster since the Floods Commission started in April 2011.
"The inquiry also found that opportunities may have existed for earlier releases of water," said Hodgson.
"The findings of the Inquiry give hope to those wanting to be part of a potential class action,” he said.