The lawsuit challenged media reports alleging misuse of compensation from a prior class action
The Federal Court has approved a $3m settlement in a class action concerning media publications that allegedly contravened the Racial Discrimination Act.
The lawsuit, brought under part IVA of the Federal Court of Australia Act and s. 46PO of the Australian Human Rights Commission Act challenged the fairness and accuracy of reports regarding the spending of compensation funds from a previous class action settlement.
The court determined that the settlement was fair and reasonable for the 437 participating group members. The case focused on publications from May 2021 that allegedly suggested that the prior class action settlement recipients were undeserving or had misused the funds. The settlement required court approval under s. 33V of the Federal Court of Australia Act, which ensures that class action settlements serve the best interests of all group members.
Under the settlement, the respondents will pay $3m into a trust account, which will be administered and distributed according to a court-approved scheme. The litigation funder, BLM Australia LLC, will receive a commission of 28 percent of the total compensation allocated to the 401 group members who had signed funding agreements, amounting to approximately $750,000. Legal costs are $670,000, while the lead applicant will receive $10,000 in recognition of the time and effort spent representing the group. The settlement also provides up to $100,000 for administrative costs associated with distributing the funds.
Compensation for group members will vary based on the impact of the publications. Those in the "Higher Damages Group" who suffered public vilification or insults as a result of the reports will receive up to $5,202 each. Other participating group members will receive a minimum of $2,000. The final amounts depend on how many individuals qualify for the higher damages group, with a balancing mechanism ensuring a fair distribution among all claimants.
In addition to monetary compensation, the settlement requires the respondents to remove the impugned publications, issue an apology and correction, and agree not to republish similar content in the future. The court noted that the case involved complex legal questions, including whether the publications breached section 18C of the Racial Discrimination Act and whether they were protected by the implied freedom of political communication. Given the significant litigation risks, the court found that the settlement was a reasonable and beneficial outcome for all parties.
The court considered three objections from group members who argued that compensation should be distributed equally. However, the Federal Court ruled that the distinction between the higher damages group and other claimants was justified because some individuals had experienced greater harm. He found that the settlement structure appropriately reflected those differences.
The court also issued confidentiality orders under section 37AF of the Federal Court of Australia Act, prohibiting the publication of privileged legal opinions, funding agreements, and cost assessments for up to 10 years. These orders ensure the protection of sensitive information while allowing the settlement to proceed without further complications.
With this decision, the case has reached its conclusion, providing compensation to affected individuals and formally resolving the dispute.