According to a new report that details the highs and lows of litigation funder cuts in class action settlements, funders’ returns have dropped considerably since contingency fees were introduced in Victoria.

While shareholder class actions have been the bread and butter of litigation funders, a new report has revealed the rise of shareholder class actions brought by lawyers without the backing of third-party funding, especially in contingency fee-friendly Victoria.

The number of funded class actions in Australia has dipped in the two years since contingency fees were introduced in Victoria, but litigation funders are still important players in group proceedings, a new report shows.