Trustees of the Labourers’ Pension Fund v. Sino-Forest Corporation

Irish funder to provide costs indemnity and $50K disbursements in exchange for 5% before pretrial ($5M cap) and 7% after pretrial ($10M cap).

Plaintiffs gave notice to defendants and to 20 of the largest institutional investors/ members. No opposition.

Agreement included an obligation on Class Counsel to inform funder about any significant issue in the action including prospects, strategy, quantum, proof and material changes. CFI acknowledges that the Plaintiffs provide the instruction to the lawyers and that the lawyers’ professional duties are owed to the Plaintiffs and not CFI.

“It is a fair and reasonable agreement that facilitates access to justice while protecting the interests of the Defendants. The Defendants have the comfort that money for their legal costs has been paid into court” (para. 15).

“In the circumstances of this case, the third party funding agreement is preferable to the alternative of funding from the Class Proceedings Fund. The commission is less than the 10% uncapped levy that would be extracted by the Fund.”

Class action was certified.  Some defendants have settled, case against non-settling defendants continues.