Man dragged onto Bagot road during violent car theft in Darwin
Police alleged the 14-year-old boy and 17-year-old girl went on to use the stolen vehicle in a series of ram raids across the city in the early hours of Saturday morning.
The pair have received more than 20 charges combined, including breach of bail, aggravated robbery, property damage and drink driving.
In a statement, NT police said at the time of the theft a warrant was out for the arrest of the teenage boy after he "allegedly fled the courts and removed his electronic monitoring device prior to his court appearance" the day prior.
Police said the incident began at around 1:35am on Saturday morning, when the two teenagers allegedly approached the man at the BP petrol station on Bagot Road in Coconut Grove.
"The male youth allegedly grabbed the victim from behind and demanded his vehicle keys before a struggle ensued," the statement read.
It is alleged the teenagers then threatened the man with a knife, before he handed over his keys and the pair drove off in his Toyota Camry.
The vehicle was then allegedly used in a crime spree across Darwin, causing damage to multiple businesses.
"A short time later, the stolen Toyota Camry was allegedly used to ram through fire escape doors at a business in Eaton, where the offenders entered the premises and stole a quantity of alcohol," police said.
Police said the pair then drove to the Darwin Waterfront precinct, where they allegedly ram raided a convenience store and stole cigarettes, before fleeing the scene.
Two hours after the pair allegedly stole the car, the Strike Force Trident and Dog Operations Unit spotted the vehicle travelling through Coconut Grove and attempted to apprehend it, but the vehicle did not stop.
Police chased the car through Millner and back into Coconut Grove, where the teenagers allegedly abandoned the vehicle and fled on foot.
"A short foot pursuit was initiated, and both youths were apprehended without further incident," police said.
Both teenagers are set to face Darwin Local Court on Monday.
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ABC News
7 minutes ago
- ABC News
Illegal tobacco is a deadly $10 billion industry wiping out legitimate businesses
Australia's illegal tobacco problem has made the proverbial transition from tragedy to farce. Illicit, excise-evading cigarettes now comprise half of the cancer-inducing products sold to Australia's 2.7 million smokers. A study published by FTI Consulting put it at 39.4 per cent in 2024, up from 14 per cent six years ago, but an update for the month of June puts it at 50 per cent. And, according to studies of wastewater, nicotine consumption in Australia, including vaping, is at an all-time high. We can now conclude that the strategy of taxing and banning nicotine addiction out of existence is a complete failure. The result is that organised crime is making about $10 billion a year in revenue. Who needs narcotics? With them, you risk lengthy jail time; with smokes and vapes, it's a fine, but only if you're very unlucky. It means Australia's criminals are better paid than they have ever been, and the result of that is showing up in an explosion in both the amount of crime and its brazenness. And because the people engaged in this "industry" are gangsters, competition is not met by price wars and the ACCC, but by burning your competitor's business to the ground, or, as happened last week, by allegedly murdering your competitor's staff. Athan Boursinos, 21, an alleged employee of "tobacco kingpin" Kazem "Kaz" Hamad and his cousin, Ahmed Al Hamza, both of whom live overseas, was shot dead in a laneway behind his home in broad daylight on Thursday morning. In the past couple of years, there have been 125 fire-bombings of tobacco shops in Victoria, and another 50 or so in other states — the most recent last week in Corrimal, NSW. Victoria's coat of arms bears the phrase "Peace and Prosperity", but there's a lot more of the latter in that state these days than the former, and that's not saying much. Violent robberies in Victoria have grown by more than 150 per cent since February 2024 due to tobacco-related crime. This is much worse than an unintended consequence of the effort to reduce smoking; it is a complete stuff-up. A window into what's happened was provided last week by Viva Energy, which operates Australia's largest network of petrol stations with convenience stores attached. In its six-monthly results, the company reported that tobacco sales are down 27 per cent — in one year! — because of the growth in the illicit tobacco trade. The problem for Viva is more than money: its petrol stations and other convenience stores are now being regularly robbed by gangs of balaclava-wearing teenagers waving handguns and machetes, traumatising the staff. Serious, well-resourced gangs are only after cigarettes — the entire stock — because at $57.89 a pack, the stock can be worth $100,000. Do five or six of those in a night, and you're making very good money. The till is small beer. The Albanese government is having a similar financial problem to that of Viva. This year's federal budget contained an estimate of $7.4 billion from tobacco excise for the current financial year, down from $8.75 billion just six months ago in MYEFO. The CEO of the Australian Association of Convenience Stores, Theo Foukkares, says the tipping point happened in 2019 when the excise increased 55 per cent over three years to $1.10 per cigarette stick. As a direct result, illicit smoking took off and tobacco excise revenue to the government collapsed, from a peak of $16 billion in 2019 to this year's $7.4 billion. And it's not just the price that's driving people towards the much cheaper illegal alternatives, although that's the main thing, especially in a cost-of-living crisis. For a start, the packs look nicer without pictures of horrible mouth tumours. And on July 1 this year, menthol cigarettes were banned completely, along with those that contain a little burst of minty flavour in the filter. Also, cigarette companies are now required to print health warnings on the cigarette stick, not just put gruesome pictures on the packet — another increase in cost. Naturally, illegal tobacco importers are not concerned about complying with the menthol ban and are even bringing in berry-flavoured cigarettes as well as menthol ones, hoping to appeal to a younger demographic. The requirement that vaping products with more than 20mg of nicotine must have a prescription is not working either. Only 700 chemists around the country stock them, reluctantly, while the products are readily available without a prescription in the same stores that stock the illicit cigarettes. There are thought to be 1.5 million regular vapers, adding to the 2.7 million smokers. The real danger now is that the stores selling legitimate tobacco will give up and leave the industry to the crooks. Coles' Liquorland has already stopped selling cigarettes, and both Coles and Woolworths are reported to be considering dropping them from behind the service counters of their supermarkets. It's harder for petrol stations to do that, since tobacco represents 25-30 per cent of store revenues; if they didn't sell cigarettes, many petrol stations would close. But eventually, with more and more staff suffering PTSD, they'll have to do it if the problem is not resolved. At which point, Australia would have managed to hand over an entire industry to gangsters. The basic problem seems to be that the excise is collected by the federal government, but the enforcement is done by under-funded state police forces. The illegal products all arrive at Australia's ports, and the importers are engaged in tax avoidance, so in theory, it should be two federal agencies that deal with it — Border Force and the Tax Office. But only about 1 per cent of incoming containers are inspected by Border Force, and ATO officers don't have the resources, or the desire, to chase organised crime gangs for a few hundred thousand dollars of excise and risk a Molotov cocktail landing on their doorstep. Once the stuff is in the country, selling it is not a criminal offence, and while blowing up or torching your competitor is a very criminal undertaking, the arsonists are proving hard to catch, except when they set fire to themselves in the process, which happens quite often, perhaps unsurprisingly. In this year's budget, the federal government said it was committing $156.7 million to the "Illicit Tobacco Compliance and Enforcement Package", adding to the $188.5 million over four years that was "invested" in 2023. That's a new total of $86.3 million a year, of which $10 million will find its way to the states. Most of it goes into the welcoming arms of Border Force. But they're bringing millions to a game of billions; a knife to a gunfight. It may be that the criminals are now too rich, well-organised and violent to be shut down, but Australia's governments can hardly give up. Confronting crime and large-scale tax avoidance is not an optional activity for the government. The only state that is coming to grips with the problem is South Australia. The Malinauskas government has set up a special tobacco enforcement squad of 45 officers and given them warrant-free search and seizure powers. Members of the squad can enter a shop selling illicit tobacco or vaping products, confiscate the stock, and shut the store for three months. With an order from a magistrate, the closure can be extended to 12 months. Theo Foukkares reports that nearby legal tobacconists experience an instant uplift in sales when that happens. The Queensland government has now copied South Australia, but the other states are slow to do it. What's needed is a meeting of state and federal attorneys general and health ministers to agree on a uniform national approach that mirrors the SA laws. Everyone knows where the shops are that are selling the illicit cigarettes — this is not an industry shrouded in mystery; it operates in plain sight. The other thing the federal government could do is reduce the tobacco excise back to what it was before 2019, which would lead to a huge increase in revenue. Alan Kohler is a finance presenter and columnist on ABC News, and he also writes for Intelligent Investor.
ABC News
7 minutes ago
- ABC News
Law firms and investors making millions from class actions while victims get just thousands
For Minnie McDonald, the class action represented hope — justice after decades of unpaid work. The lawsuit was supposed to right a wrong, provide compensation for thousands of Aboriginal workers who received little or no money for their labour. Instead, some Aboriginal workers and their families will end up with payouts as little as $10,000, while the law firm and its financial backers have pocketed tens of millions. Minnie agreed to be the lead plaintiff in a Northern Territory class action, meaning she represented the group, instructed the lawyers, reviewed costs, and signed legal documents on behalf of the group. But Minnie can't read or write. For help, she relied partly on her granddaughter, who has no legal experience, alongside Shine's lawyers. Shine told Four Corners that Minnie was given independent legal advice. One document Minnie signed was a proposed $11 million increase to Shine's costs. At least one class action is launched every week on average in Australia against banks, governments, and big corporations. But the stolen wages case raises questions about whether class actions are delivering justice for ordinary Australians or are simply a money-making exercise for lawyers and investors. Minnie was just 14 years old when she started working on an outback station near the Queensland-Northern Territory border. Her family was paid in rations of flour, sugar, and tea. Now aged in her 90s, Minnie still remembers life on the station. "It was hard work," she says. Living in a tent and working alongside her family, they would occasionally receive the bones of a bullock killed by the station owner and cook it over an open fire. "My mother used to cook it. Backbone, leg bone, everything," she says. In Western Australia, Mervyn Street and his family lived and worked on another station and were also paid in rations. Mervyn remembers his father being given "a blanket, a canvas and an axe". "My family worked like slaves," he says. Like Minnie, Mervyn was the lead plaintiff in the WA class action representing thousands of Aboriginal men, women, and children who lived and worked on stations and in missions over the past century, receiving little to no pay. Like Minnie, he can't read or write either, and relied on a younger relative and Shine lawyers to help him. Class actions are hugely expensive, but a law change in Australia almost 20 years ago transformed them into a form of investment where "litigation funders" provide the capital. These dedicated companies team up with lawyers to finance the legal costs of a class action in return for a slice of any payout. When they are successful, funders can more than double or triple their money. However, if they lose, the funders lose their investment and have to pay the other side's costs. The chairman of the Association of Litigation Funders of Australia, John Walker, says they don't see it as gambling. This business model is how legal firm Shine Lawyers was able to launch class actions in NT and WA to recoup stolen wages, after securing the backing of Litigation Lending Services, a company chaired by billionaire businessman Shaun Bonett. It took four years, but both class actions eventually reached a settlement. In WA, the state government agreed to pay $180 million, and the federal government paid about $200 million for the NT. But first, the law firm and investors have to take their cut. Shine Lawyers will receive more than $41 million in approved costs for its work in both cases, while Litigation Lending Services will take a commission of up to $57 million. The exact amount that Aboriginal workers will receive is unclear because the final number of eligible recipients is not known. Based on court documents, Four Corners estimates the workers will get between $10,000 and $14,000. If those workers have died, the amount will be divided among their families. Although it was Minnie who had to approve the proposed settlement, she said it wasn't enough. She had hoped there would be enough to buy a car so that her children "could take me for a picnic somewhere, you know, have a feed, cook kangaroo tail or whatever, but I didn't get enough". When Four Corners spoke to Mervyn, he was unaware of the final payout individuals would receive until it was spelt out to him. "What you're telling me is not good enough," he says. Shine Lawyers did not want to do an interview with Four Corners. It said in a statement that governments had ignored "the stories of indigenous workers who were denied fair wages. Shine Lawyers gave Aboriginal workers "the chance to tell their stories, receive compensation and be acknowledged … for the historical injustices they suffered". When asked about Minnie and Mervyn's inability to read and write and their capacity to understand legal and financial issues, Shine said: "We are confused that the ABC would suggest that illiteracy implies a lack of intelligence". "This is an unacceptable proposition." Shine said it was not appropriate to comment on "the way in which we provided advice … as these are privileged communications". "We can confirm, however, that both clients received independent legal advice" and that "Shine Lawyers used Aboriginal barristers to bridge communication and cultural barriers." Former Indigenous Affairs Minister Linda Burney questioned how much people understood about the class action. "If you are illiterate, if you're innumerate, and your first language is not English, how on Earth are people supposed to understand anything?" she says. "It is very exploitative because you are seeing such a disparity in the outcomes for the legal teams financially, and the outcomes for those that have joined the class action." The stolen wages cases have highlighted concerns about the business model underpinning class actions in Australia and the amounts being taken away by funders and lawyers. The judges who oversaw the WA and NT class actions flagged their concerns about the high legal costs when delivering their judgements, but ultimately approved the settlement amounts as "fair and reasonable". In the NT, Chief Justice Elizabeth Mortimer was scathing in her judgement, saying "the pursuit of the business model" had, at times, overshadowed the good intentions of the lawyers. She said "it would not be surprising" if Aboriginal workers who were part of the class action thought that "the proceeding was little more than a money-making exercise for others". "It seems to me a not inconsiderable number of people … would be frustrated, and likely mystified about how city-based non-indigenous participants in this proceeding come out with so much money compared to their family and friends," Justice Mortimer said. In WA, Justice Bernard Murphy remarked on the "enormous costs" Shine racked up travelling around the state signing people up to the class action. Part of those costs included law clerks who were billed out at a rate of $375 an hour, even though many of them were undergraduate law students. Describing the charges as "excessive" and "seriously overblown", Justice Murphy deducted $4 million from the firm's claims. Shine said "the costs were incurred over the course of six years" and that "a significant portion … came as a result of a "court-ordered outreach and registration process". The breakdown of what lawyers are charging is rarely disclosed, even to members of a class action other than the lead plaintiff, although class members can usually request access. But a confidential report of Shine's costs was released to Four Corners after an application through the courts, revealing in granular detail what the law firm charged while working on the WA class action. It shows Shine had at least a dozen barristers – one charging almost $5,000 an hour — who billed the class action almost $3.5 million. But there were bills that were rejected by a costs expert appointed by the court. Shine tried to charge almost $35,000 for booking and credit card fees from its clients, but the expert rejected it because they were "usually considered to be an overhead of the business rather than a cost reasonably borne by the applicant". Thousands of dollars for Uber and taxi fares were also rejected. Shine also tried to claim tens of thousands of dollars for "grocery items, meals purchased whilst travelling to various communities, and meals and alcohol purchased in hotels and restaurants". The expert rejected these, saying these "should form part of the firm's internal overheads in running a matter such as this". The funder of the stolen wages cases, Litigation Lending Services, bankrolled another action in Queensland. They are set to make up to $95 million in commission from all three cases, which equates to a 250 per cent return on their investment. The funder, Litigation Lending Services said "the real injustice" is how "government fought these claims fiercely, with considerable public resources over many years". "Without LLS's financial support and commitment to taking on all the risk, these claims would not have been brought and group members would have received nothing," it said in a statement. They told Four Corners they were proud of their role and their commission was lower than market rates "to reflect the social justice nature of the claims". George Dann, a member of the WA class action who started work at age 14, was appalled by the amount going to Shine and Litigation Lending Services. He says the amount being taken in fees and commissions is disgraceful. "They get that in an hour, what our family would get in a year," he says. His cousin, Sharon Todd, who put in claims for both her parents, was shocked to learn of the sums. "It's a real insult. It just makes me feel that we are an industry that is being used over and over again to make money for other people," she says. "How are these people sleeping at night?" Although the settlement was approved by the Federal Court almost a year ago, none of the people who joined the WA class action have received any money. The administrators, Grant Thornton, who is being paid up to $3 million to administer the funds, says it's been unable to distribute the funds because it's been dealing with the Australian Taxation Office over a tax issue, which has now been resolved. Shine Lawyers has been paid its share. "It's a farce," George Dann says. "A lot of people worked all their life, and for this to happen, it's a terrible thing." In Canberra, there has been a political battle over the lack of regulation for law firms and litigation funders in the current class action system. Most of the litigation funders operating in Australia come from overseas, with some of them based in tax havens. They are not required to hold a financial licence with ASIC, the corporate regulator. "We have a system where litigation funders who were taking sometimes 30, 40 per cent of the settlement away from victims operate in a largely unregulated environment," says David Hughes of the Liberal-aligned Menzies Research Centre. "In many instances, you could argue that they have less regulation than real estate agents or mortgage brokers." The Morrison government tried to crack down on lawyers and funders in 2021 by capping legal fees and funder commissions at 30 per cent of the settlement. Labor opposed the proposal, and the legislation never went through parliament. Mr Hughes believes the reason for Labor's opposition was because the party is connected to the law firms. "The Labor Party has had strong links with what we call these plaintiff law firms, so think of the Slater and Gordons and the Maurice Blackburns … they're often seen as a training ground for future Labor politicians," he says. "Labor was sympathetic to the cause of these plaintiff law firms, but ultimately these plaintiff law firms just knew that their profit share was at risk if these reforms went through." Maurice Blackburn said it "actively engaged with decision-makers … to make sure everyday Australians were better represented by the law". A statement from Attorney-General Michelle Rowland said that class actions provide an important pathway for Australians who might otherwise be denied justice. John Walker, the head of the Litigation Funders Association of Australia, says the Coalition and the Liberal-aligned Menzies Research Centre have their own agenda in wanting to protect "the big end of town" from shareholder class actions against big business. He says litigation funders are necessary to pay the legal bills so that ordinary people can get justice. "We're a for-profit industry and we seek to maximise profit as much as we can, but at the same time seek to focus on creating value," he says. Mr Walker also disputes suggestions that litigation funders are not regulated. "We are regulated daily. The system has a capacity to do the best it can. It has checks and balances," he says. "We need to submit to the court and say, 'you tell us what we are going to get paid'. Barrister Peter Cashman, who was at the forefront of class actions in the 1990s, believes the system needs to change to ensure group members get a fair share of the settlement. "Transaction costs are high, the legal costs are high, the funding commissions are high, and the ultimate people who pay the price are the consumers or the class members," he says. "Australia has become a honey pot for commercial investors in litigation. They're not in it for love, and they're not in it to further the interests of access to justice. They're in it for the money. Mr Cashman wants to see the federal government establish an alternative model to fund class actions and prevent them from becoming money-making machines. "You need a publicly funded not-for-profit entity to fill the void that was filled by commercial funders that would do the cases without seeking to make a profit out of it … where the transaction costs are lower, and where the funder is interested in funding … public interest cases." Watch Four Corners' full investigation, The Price of Justice, tonight at 8.30pm on ABC TV and ABC iview.
ABC News
3 hours ago
- ABC News
Do class actions really deliver justice?
Sam Hawley: On average, there's a class action launched in Australia every week. But do they really help bring justice to groups of Australians exposed to wrongdoing? Today, Anne Connolly on her Four Corners investigation into the class action traps leaving victims short-changed and lawyers richer. I'm Sam Hawley on Gadigal land in Sydney. This is ABC News Daily. Sam Hawley: Anne, in Australia, class actions have become pretty common, haven't they? It's a really important way to address injustices in this country. Anne Connolly: Well, yes, that's what class actions are designed to do. And I mean, when there were some really major catastrophes, such as the Victorian bushfires, the Queensland floods, class actions were taken to get some money back for those people. News report: Property owners around Horsham in Victoria have banded together to bring the first class action arising from the Black Saturday bushfires. Anne Connolly: Same with the pelvic mesh issue against Johnson & Johnson. News report: The federal court found Johnson & Johnson had been negligent and driven by commercial interest and ordered them to pay compensation. Anne Connolly: There's many, and they're very varied. Sam Hawley: Yeah, and you found during your Four Corners investigation, this is a billion dollar industry, but it's not always in favour of the individual victims. So to explain this further, why don't we look at a recent case, Anne, a legal fight between more than 8,000 Australian taxi drivers and Uber. Anne Connolly: Well, I mean, I think most people remember when Uber entered the market, obviously the taxi industry was absolutely decimated. They just couldn't compete any longer. One of the taxi owners I spoke to is a man called Stephen Lacaze. He said he had a licence in Queensland, which was at the time valued at about half a million dollars. It went to being virtually worthless once Uber came along. Stephen Lacaze, taxi owner: Oh, it was devastating. People virtually went into shock. Anne Connolly: So when Maurice Blackburn, which is one of the biggest class action firms in Australia, came along and proposed a class action, he was very keen to sign up. Stephen Lacaze, taxi owner: We were friendless. And here comes Maurice Blackburn with their Bradman-like batting averages, and their 'we fight for fair' banner, and we're there with bells on. Sam Hawley: OK, so Stephen was keen to fight this. Maurice Blackburn lawyers take it on, and they get a third party, a litigation funder, to pay the costs. Just explain how that works. Anne Connolly: Yeah, so what happens is Maurice Blackburn doesn't want to go this alone. So what they do is they engage somebody called a litigation funder. And litigation funders, they pay the lawyers' fees, they support them, and if they lose, they pay all of the costs, so there is some risk. But in return for taking that risk, they want a percentage of any payout that they win. So in this case, with Maurice Blackburn, they had a partnership with an offshore firm called Harbour Litigation Funding, which is actually registered in the Cayman Islands. It's a tax haven, and there's quite a few litigation funders in tax havens. Under this deal, they said, we want 30% of the proceeds. And Stephen signed up for that, as did most of the taxi drivers. Stephen said he did that because he thought they were going to get a payout worth billions because that's how much they'd lost. Sam Hawley: So in this case, Maurice Blackburn, the law firm, ends up settling this class action. So just tell me what happens then. Are the taxi drivers elated about this? Anne Connolly: Well, the night before the trial was due to start in March last year, Maurice Blackburn brokered a deal with Uber. That would be that Uber would pay $272 million in compensation. Now, once Harbour took its commission, that came out at $81.5 million. Maurice Blackburn took its legal costs, which came to $39 million. It means that the drivers were left with just over half the payout. Now, we don't know what individual taxi drivers will get. Stephen Lacaze believes he'll get about $20,000 once all of these fees and commissions come out of his payment, which he says is nowhere near what he lost. Sam Hawley: What did Maurice Blackburn have to say about that? Anne Connolly: They said the federal court had approved the settlement as fair and reasonable, and Harbour, the funder, said that the case was long-running and there were significant risks. Sam Hawley: Hmm, OK. So, Anne, that's the case of the taxi drivers against Uber, and we're going to talk about another really concerning case in a moment. But before we do, let's just look at the system more deeply. The worry here is that the whole class action system is set up to make profits for the law firms and the funders, but not deliver the justice to the victims, right? Anne Connolly: Well, there's some people who are concerned about that. I mean, the lawyers and the funders will say, without us, people would get nothing. The problem is that what's happening now is most people think a class action begins with a group of victims, but that's not really the case anymore. Now everything has changed because litigation funders have now entered the Australian market. So what happens is, it's the law firms and the litigation funders getting together and seeing, what are these issues that we could launch a class action on so that they can make money and then they can sign up the group members? So the concern is, are they really seeking justice for people or are they actually just finding a business opportunity so that they can make as much profit as they possibly can? Sam Hawley: Anne, let's now look at another case where the victims are left with, in comparison, petty change. Just tell me about Minnie McDonald. Anne Connolly: So Minnie McDonald is a woman in her 90s. She lives in Alice Springs and she was approached by Shine lawyers to become what's called the lead plaintiff in a class action in the Northern Territory for stolen wages of Indigenous workers who worked on cattle stations and missions for little or no money. Minnie McDonald, lead plaintiff: No shoes, get up in the morning, go to work. Come back afternoon, cold. Anne Connolly: So this case relates to the treatment of people like Minnie who, along with a lot of other... ..thousands of other Aboriginal men, women and children worked for little or no pay between the 1930s and the 1970s. Look, I just think, you know, one of the things I want to say about this is if ever there was a class action needed, perhaps it was in this particular case. I mean, there's questions about why the governments didn't just actually pay people what they deserved instead of being forced to court and forced to pay out compensation. But in any case, what Shine says and what the litigation funder says is we were doing our very best to get right a particular historical injustice. Sam Hawley: So the law firm Shine takes on this class action along with the litigation funder, Litigation Lending Services, and Minnie becomes the lead plaintiff. But the thing is, Anne, we know with legal cases, there's a lot of paperwork and Minnie had to sign a lot of that and she can't read or write. Anne Connolly: That's right, she can't read or write. So Minnie had her granddaughter Elizabeth to help her. However, Elizabeth does say, you know, it was complicated. It was difficult to understand at times. So Minnie did sign one document which said that Shine's costs had increased by $10 million and she signed off on that. I asked her about it and I asked her granddaughter if they remembered it. They didn't. I asked Shine, did they check that Minnie had the capacity to understand the complex legal and financial issues around class actions? They said being unable to read or write is no indication of intelligence and that they had an Indigenous barrister who helped to cross these cultural barriers and explain the process to them. Sam Hawley: So tell me what ended up happening with the case. Anne Connolly: So there were two class actions in WA and the NT and they both settled. So they didn't go to court. In Western Australia, there was a settlement for $180 million. In the Northern Territory, it was $200 million. Which sounds, you know, really positive. But what has to come out of that are the legal costs and the commission for the litigation funder. So they're not going to end up with that much. They'll end up with at least $10,000 and some will end up with more than that. Minnie McDonald, lead plaintiff: So somebody might... get a car and just take me for a picnic somewhere, you know, have a feed. But... I didn't get enough. Anne Connolly: You didn't get enough to buy a car? Minnie McDonald, lead plaintiff: Yeah, yeah. Nothing. Not enough. Anne Connolly: On the other hand, what's happened is Shine Lawyers is going to get about $30 million for its work. And the funder, Litigation Lending Services, they will take a commission of about $57 million. Sam Hawley: And you've had a really good look, haven't you, also, at the amount the law firm Shine was actually charging. Anne Connolly: Well, that's very interesting because Shine was roundly criticised in both WA and Northern Territory courts by the judges there. In one instance, Shine was charging for law clerks, charging them out at $375 an hour, even though many of them were unqualified uni students. They hired at least a dozen barristers that cost almost $3.5 million. One of those barristers charges almost $5,000 an hour. So, you know, the legal costs are the things that's really interesting. Sam Hawley: All right. So, Anne, the law firms and the funds are making a lot of money from these class actions in many cases. They do argue, as you mentioned, that they're actually giving people a chance to have these cases heard. What has Shine told you? Anne Connolly: Well, Shine said we were the only ones who were willing to take this on. We have given Aboriginal workers a chance to tell their stories. They've received compensation and they're being acknowledged for the historical injustices that they've suffered. And they said that these cases require experienced and well-resourced lawyers. And Litigation Lending Services, they said that they're proud of their involvement and that their commission was lower than the standard market rates because they wanted to reflect the social justice nature of these claims. Sam Hawley: And you spoke to the head of the Association of Litigation Funders. So this is a group that represents the firms that financially back these class actions, the funds. Its head is John Walker. So what's he had to say? Anne Connolly: Well, he said, look, you know, this is a market. This is a financial market that they operate in. They're trying to get some justice for people, but at the same time they're trying to make a profit and they don't shy away from that. John Walker, Association of Litigation Funders : We underwrite the project. We'll pay everybody if we lose, but in return, if we win, then we get a share of the recovery. We don't see it as gambling. We see it as investing. It's a market, and I don't step away from that. Anne Connolly: He essentially says, look, what we're doing is we're trying to correct the bad behaviour. Even if these class members are not getting enormous sums, it's sending a message to the big end of town that you can't operate in this way any longer. John Walker, Association of Litigation Funders : I'm absolutely proud of what's happened with class actions in Australia. They're absolutely essential to create accountability in respect of the big companies and governments. Sam Hawley: But, Anne, it does sound like a system that's not really working as it should. That is for the everyday people who need it. Anne Connolly: Well, I think what happens is a lot of people look at a class action sum and they believe that the sum that's been publicised is what people are getting. They don't realise that up to half of it can disappear in fees and commissions. The other point being the only class actions that actually get funded and get run are those that turn a profit. So when you're talking about others that might be very worthy, they won't get up if the bottom line doesn't look good. I think the problem arises when you're talking about people who have really suffered, such as these Aboriginal workers in the stolen wages cases who thought that they were going to get some proper compensation and what they're getting is simply a fraction of what they really deserve. And when they do see litigation funders and lawyers walking away with tens of millions of dollars, it makes it difficult for them to understand and sometimes it can feel like they've been exploited all over again. Sam Hawley: Anne Connolly is an investigative reporter with the ABC. You can see her Four Corners report on ABC TV tonight at 8.30pm or you can catch it on iView. This episode was produced by Sydney Pead. Audio production by Sam Dunn. Our supervising producer is David Coady. I'm Sam Hawley. Thanks for listening.
