The Funding Agreement Explained
Information Memorandum on 7-Eleven Class Action re: Litigation Funding
1. You do not need to pay anything from money that you currently have, under any circumstances – even if 7-Eleven wins.
The Class Action against 7-Eleven is a “No-Win, No-Fee” Class Action, fully funded by a third-party litigation funder, who pays all legal costs upfront, and indemnifies you for Cost Orders (in the event 7-Eleven wins), as well as lodging Security for Costs with the Court.
2. If the action succeeds, the funder is reimbursed for legal costs and takes an additional 35% of the settlement or verdict monies payable to the group.
65% of the settlement or verdict monies, apart from costs, will be distributed amongst group members, with the balance going to the Funder.
3. Costs are paid by the losing party, which we hope will be 7-Eleven. The effect of a Court order for costs against 7-Eleven would be to substantially offset the costs outlaid by the Funder in which event, the Funder only recovers the difference out of the settlement or verdict monies.
Please note: If 7-Eleven wins, you will not be liable to pay for any legal costs – as per 1 above, the Funder pays all legal costs upfront and has also lodged Security for Costs with the Court.
If we are successful in the Class Action, by either negotiating a settlement or obtaining compensation through a judgment or verdict, then the Funder will be entitled to reimburse itself for the costs it has outlaid.
4. While it is possible to participate in the Class Action without signing a Funding Agreement, such “free-loading” would threaten the economic rationale for the Funder to continue to fund the action. Further, the Court can still make a Funding Equalisation Order, requiring you to contribute proportionately to the costs of the proceedings, even if you do not sign a Funding Agreement.
5. We hope that we have provided an adequate explanation of the funding terms and if you have any queries, please do not hesitate to email or call us.
Stewart A Levitt