Lawyers Taking a 40 Percent Cut of Compensation Claims: Report

Litigation funding companies and law firms took over 40 percent of the money won by class action litigants between 2009 and 2020, amounting to almost $1 billion

The outside of the Supreme Court of New South Wales building is seen in Sydney, Australia, on Oct. 9, 2013. William West/AFP via Getty Images

A new report by the Menzies Research Centre has found that the rise in class actions taken on “no win, no fee” bases and underwritten by litigation funders has deprived plaintiffs of a significant share of the damages they’re awarded.

Between 2009 and 2020, 41 class actions backed by litigation funders were settled in Australia for a total of $2.389 billion. From this, lawyers took $341.84 million in fees and charges.