Australian class action risk: what global litigation trends signal for boards and executives

Class action risk is increasingly being shaped beyond Australia’s borders. For boards and senior decision makers, understanding developments in foreign jurisdictions – including overseas proceedings, regulatory action and litigation funding dynamics – is now critical to anticipating litigation risk in Australia. 

Claims that gain traction in the United States, the United Kingdom and Europe frequently inform the strategies adopted by plaintiff firms and funders locally. This trend is accelerating as class action markets globalise, capital flows across borders and regulators and courts overseas test novel theories that reshape expectations of corporate accountability. 

As class action and collective action regimes around the world continue to expand and mature, the gap between developments abroad and class action risk emerging in Australia is narrowing. While Australia is regarded as a relatively active and sophisticated class actions market, with class action settlements totalling roughly A$1.6 billion in 2024/25, it remains small in scale relative to global activity, and susceptible to global litigation and regulatory trends.

The breadth of offshore class actions highlights why international trends matter when assessing what may lie ahead in Australia. The United States remains by far the largest class action jurisdiction globally, recording more than 1,700 class action settlements in 2025, with total settlement values of approximately US$79 billion, dominated by antitrust, product liability and securities fraud matters. 

Other jurisdictions are also experiencing rapid growth. In the United Kingdom, the class actions market has expanded significantly over the past decade, as the Consumer Rights Act 2015 introduced a new opt-out regime for competition law collective actions in the Competition Appeal Tribunal (CAT). In the European Union, the EU Representative Actions Directive adopted in 2020 has required all EU countries to implement at least one collective redress mechanism for consumers, with the aim of harmonising regimes across EU countries.

‘Copycat’ class actions driven by overseas litigation will remain a dominant feature

Australian plaintiff firms and litigation funders are increasingly looking offshore for inspiration, with foreign jurisdictions operating as incubators for new causes of action and funding strategies before they are implemented in Australia. 

Plaintiff firms have been candid about this approach. Maurice Blackburn has described one current class action as explicitly modelled on ‘similar proceedings in the USA’ as well as ‘class actions in the UK Competition Tribunal and Canada’. After a recent US ruling against two technology companies, Shine Lawyers announced it was ‘investigating how an Australian claim could be run’.

Australia has already seen multiple waves of copycat litigation, particularly in relation to medical and pharmaceutical products (including talc, medical implants and cold and flu medicines), in the automotive sector, and more recently, in technology-related claims. We expect this trend not only to continue beyond 2026, but also to broaden into new industries and sectors, particularly those experiencing heightened or emerging regulatory scrutiny.

Australia’s class actions regime features a relatively low threshold for commencing proceedings – there is no ‘certification’ step as in the US and UK, and only one substantial common issue of law or fact needs to be identified. Australia’s robust regulatory framework facilitates consumer and product‑based claims, and overseas claims alleging defective or unsafe goods can often map well onto Australian Consumer Law claims. At the same time, Australia’s adverse costs regime – where the losing party typically pays the winning party’s costs – can deter more speculative claims that might otherwise be viable in jurisdictions without similar costs exposure.

Novel class action claims are expanding the range of Australian targets

As overseas plaintiff firms continue to push and test new claim theories, local counterparts are increasingly following suit, particularly where novel claims align with Australia’s regulatory and damages landscape. As a result, claims pioneered offshore are reshaping the domestic class actions risk landscape and expanding the pool of businesses exposed to potential claims. For example, one Australian plaintiff firm is consulting with a US law firm to explore a potential class action concerning ‘proton pump inhibitor’ medication.

While enthusiasm for securities and shareholder claims has softened in recent years following a series of plaintiff losses at trial, we have seen an uptick in employment, consumer and product claims. Looking ahead to 2026 and beyond, we expect to see greater diversification in Australian claims, particularly into areas such as privacy, data, cyber, climate change, human rights, and other emerging areas of regulatory and social concern (both in Australia and overseas).

In the UK, given that only competition law class actions can be brought on an ‘opt-out’ basis, there have been instances in which plaintiffs have looked to shoe-horn consumer rights into this regime in creative ways. In 2024, a claim was commenced seeking damages for alleged ‘data or information abuse’ by a technology company where the excessive pricing allegation has been framed as the cost to consumers being requirements to provide data to use certain services. In 2025, another claim accused six water and sewage companies of under-reporting pollution, allegedly resulting in higher prices through an abuse of market dominance (although the CAT declined certification in that case). The later claim was ultimately not certified. Against this background, the UK Government has asked the Law Commission to consider the potential introduction of a consumer class actions regime.

Australia’s uptake of novel claim categories adopted in other jurisdictions has not been uniform. For example, privacy litigation has emerged as a centrepiece of the business model of the US plaintiff bar in recent years, and while privacy class actions are an area to watch locally – and representative complaints can and have been made under the Privacy Act 1988 – only a handful of privacy class actions have been commenced in Australian courts to date.

Foreign regulatory activity is shaping Australian class action risk

Regulatory enforcement overseas is increasingly acting as a trigger for Australian class action activity. For example, recent Australian proceedings have taken inspiration from foreign regulators’ engagement with areas including PFAS contamination and phenylephrine‑based medicines. Enforcement action and public scrutiny by foreign regulators can act as a catalyst for class action activity in Australia, particularly given the relative strength and flexibility of Australia’s consumer protection or product safety regimes, which can often be leveraged without the need for issue-specific reforms. We expect activity by regulators overseas will play an increasingly important role in shaping investigations and new filings by plaintiff firms in Australia in 2026 and beyond. 

At a high level, evolving regulatory focus and policy developments – both internationally and in Australia – may influence areas of future class action risk. In the Australian context, foreshadowed legislative reform following the Australian Competition and Consumer Commission’s Digital Platform Services Inquiry, may be an area where funders and claimant firms look more closely for opportunities.

Global litigation funding dynamics are influencing where class actions are brought

Global dynamics in litigation funding are also expected to influence the Australian class actions market in 2026 and beyond. 

Litigation funding markets are increasingly global, with capital allocated across jurisdictions to balance risk and returns. The global funding market is projected to grow significantly over the coming years. The US market remains robust, and while the UK’s 2023 PACCAR decision raised concerns about the enforceability of litigation funding agreements in that jurisdiction, the UK Government has recently announced plans to effectively reverse that decision through legislative reform. 

Against this backdrop, a series of important Australian court decisions in 2025/26 may increase Australia’s appeal as a destination for global litigation funding. This includes: 

• the finding in Kain v R&B Investments that common fund orders are available at the time of settlement or judgment (and rejecting the concept of a ‘Solicitor CFO’); and
   
• confirmation of the availability of soft class closure orders in Lendlease v Pallas.  

The High Court of Australia is also expected to resolve key questions of causation and loss relevant to shareholder class actions this year. If these developments draw greater funding capacity into the Australian market, particularly as funders rebalance global exposure, Australian defendants should expect to see more, better resourced class action claims in this jurisdiction.

Strategic implications for boards managing class action risk

Class action risk in Australia is increasingly shaped by forces beyond Australia’s borders. Claims proven overseas, regulatory activity abroad, and evolving global funding dynamics are all likely to influence the types of proceedings commenced locally.

For businesses, boards and senior decision‑makers, monitoring overseas developments is therefore critical to anticipating class action exposure and managing litigation risk before it crystallises into Australian proceedings.