CLASS ACTION PROCEDURE & KEY POINTS FOR BREWERS: SETTLEMENT PROTECTION

From time to time I will post bits of information about class action process, so that Independent brewers considering the potential case understand how class actions work.
Today's issue - What guarantees are there that a settlement is good enough for brewers? What stops a settlement being only for the benefit of the lawyers or the brewer representing the group?
ANSWER: Unlike a typical case, a class action can only be settled with the approval of the Court. This means that a Judge scrutinises the settlement arrangement, usually the amount recovered and legal fees. The Court makes sure that class action members (in this case brewers) are properly looked after, because the members of a class action aren't as actively involved as a claimant or plaintiff in a typical case, where no Court approval is required. In the case of a class action settlement, before approving a settlement the Court has to be convinced that the settlement is "fair and reasonable" and in the interests of the class action members. If that isn’t proven then the settlement won't be allowed. The approval process is so in depth that it takes place over a period of time, usually months, and during that time class members are informed about the possible settlement and have a chance to have their opinions heard, even object in court, if they want.
Hopefully, I have explained that the entire settlement process is thorough and that should give a lot of comfort that the outcome and procedure will have integrity, and the system has meaningful checks and balances.
This procedure in the Federal Court of Australia has been around for 25 years, and judges have shown great ability to analyse proposed settlement and protect claimants. For example, in one case a court said about the procedure for approving a class action settlement: "Each aspect requires consideration. The Court does not rubber stamp a settlement. The role of the Court is onerous"
I should say that there is no guarantee that an Independent Brewers’ Class action for misuse of market power (by tap contracts) will reach a settlement. Being able to achieve a settlement depends to a large degree on the individual parties, the independent brewers AND the large corporate defendant being ready to agree to compromises. A settlement is often a sensible commercial outcome for all concerned. The alternative, which we are also diligently preparing for, is to run the matter at trial and obtain a final judgment from the court based on all the evidence and legal submissions.
Our team remains ready to answer questions directly about the settlement procedure, or any other aspect of the potential case.
Useful weblinks on this point: -

- http://www.austlii.edu.au/…/consol_a…/fcoaa1976249/s33v.html
- http://www.fedcourt.gov.au/…/practice…/practice-notes/gpn-ca
- http://www.austlii.edu.au/au/journals/VicJSchol/2008/9.pdf

As always with the procedural explanations I will give (or anything to do with the Independent Brewers’ Class Action), Adley Burstyner is happy for independent brewers to contact us if you'd like further explanation.

And also as previously said, no commitment to run the case has been made by Adley Burstyner – at this stage we consider the situation cries out for legal intervention and is one which is worthwhile investigating further with a view to potentially preparing and commencing a case in subsequent months.

David Burstyner
Principal
Adley Burstyner
T +61 3 9611 0137 l M +61 411 072 743
Level 5, 707 Collins Street, Melbourne, 3008, Victoria, Australia
E: dburstyner@adleyburstyner.com.au