find the latest legal job
Senior Associate - Litigation & Dispute Resolution
Category: Litigation and Dispute Resolution | Location: Melbourne CBD & Inner Suburbs Melbourne VIC
· Come work for a firm ranked in Lawyers Weekly Top 25 Attraction Firms
View details
Associate - Workplace Relations & Safety
Category: Industrial Relations and Employment Law | Location: Brisbane CBD & Inner Suburbs Brisbane QLD
· Employer of choice · Strong team culture
View details
Freelance Lawyers
Category: Banking and Finance Law | Location: All Perth WA
· Freelance opportunities through Vario from Pinsent Masons
View details
Freelance Lawyers
Category: Other | Location: All Adelaide SA
· • Qualified lawyer with a strong academic background
View details
Freelance Lawyers
Category: Other | Location: All Melbourne VIC
· • Qualified lawyer with a strong academic background
View details
Both sides claim victory in Telstra shareholder class action

Both sides claim victory in Telstra shareholder class action

TELSTRA TRUMPETED “class action dismissed” while opposing counsel Slater & Gordon was equally buoyant about the approval of the Telstra class action settlement by the Federal…

TELSTRA TRUMPETED “class action dismissed” while opposing counsel Slater & Gordon was equally buoyant about the approval of the Telstra class action settlement by the Federal Court last week.

Justice Peter Jacobsen officially approved the settlement in the Federal Court on 13 December. Only six shareholders of an estimated 29,000 possible class members lodged objections to the settlement.

Telstra issued a written statement immediately after approval was handed down: “Telstra expected to win the case, but we could not guarantee we would recover our costs, meaning that the small settlement offer put to us by our opponents represented the best outcome for our shareholders.”

“I just think that’s nonsense,” responded Ken Fowlie, partner at Slater & Gordon. “The fact of the matter is that when the settlement was reached, the case was fully prepared, it was about to start in trial, his honour the judge indicated that he didn’t expect the trial to run for more than a couple of weeks and even Telstra would struggle to spend $5 million on a case that was about two weeks away from beginning,” he said.

“Telstra is not the sort of company that resolves claims lightly, and to be honest, the fact that Telstra has made any offer of settlement resulting in money being provided to shareholders I think speaks much louder than their press release in terms of their contention about the case,” Fowlie said.

Telstra group general counsel Will Irving maintained that the costs of ongoing appeals and the risk of non-recovery from the lead plaintiff were instrumental in the decision to settle. “It was a very asymmetrical case in terms of the costs — the onus was really completely on Telstra,” he said.

While Fowlie believes that this is a situation where “shareholders are unambiguously better off”, Irving said that the amount awarded was only 1.2 per cent of the $300 million originally claimed. He hinted that Slaters’ own shareholders should be concerned about the time and cost of the firm’s involvement in the case.

“The fact that Slater & Gordon — on the evidence they put before the court yesterday — have written-off a whole lot of time and have not charged for all sorts of things, suggests that at least in this case they have recognised that they have walked away with a big loss for their shareholders as well,” Irving said.

“I’d hope that their shareholders and their management would have a long, hard look this type of case. Hopefully in future they recognise that there are costs to litigation on all sides, and running cases which are speculative, and in this case ultimately — in my view — doomed to failure, is not actually in anyone’s interests,” he said.

The value of the payout to shareholders is the only aspect of the settlement deal not in dispute by the parties. Investors who purchased Telstra shares on-market between 12 August and 2 September 2005, and who did not sell those shares before 6 September 2005, will be entitled to claim compensation in respect to those shares. The compensation will be up to 5 cents per share, depending on the number of shareholders who make a claim.

Like this story? Read more:

QLS condemns actions of disgraced lawyer as ‘stain on the profession’

NSW proposes big justice reforms to target risk of reoffending

The legal budget breakdown 2017

Both sides claim victory in Telstra shareholder class action
lawyersweekly logo
Promoted content
Recommended by Spike Native Network
more from lawyers weekly
microphone
Oct 20 2017
Podcast: One of law’s most infamous alumni – in conversation with Julian Morrow
In this episode of The Lawyers Weekly Show, Melissa Coade is joined by The Chaser’s Julian Morrow....
protest
Oct 20 2017
High Court overturns ‘excessive’ anti-protest legislation
Bob Brown’s recent victory in the High Court over the Tasmanian government was a win for fundament...
Blocked
Oct 20 2017
Changes to Australian citizenship laws blocked
Attempts to beef up the requirements to obtain Australian citizenship were thwarted this week, after...
APPOINTMENTS
Allens managing partner Richard Spurio, image courtesy Allens' website
Jun 21 2017
Promo season at Allens
A group of lawyers at Allens have received promotions across its PNG and Australian offices. ...
May 11 2017
Partner exits for in-house role
A Victorian lawyer has left the partnership of a national firm to start a new gig with state governm...
Esteban Gomez
May 11 2017
National firm recruits ‘major asset’
A national law firm has announced it has appointed a new corporate partner who brings over 15 years'...
opinion
Nicole Rich
May 16 2017
Access to justice for young transgender Australians
Reform is looming for the process that young transgender Australians and their families must current...
Geoff Roberson
May 11 2017
The lighter side of the law: when law and comedy collide
On the face of it, there doesn’t seem to be much that is amusing about the law, writes Geoff Rober...
Help
May 10 2017
Advocate’s immunity – without fear or without favour but not both
On 29 March 2017, the High Court handed down its decision in David Kendirjian v Eugene Lepore & ...