Victorian government settles $125m COVID-19 business class action
Consensus Summary
The Victorian government has agreed to pay $125 million to settle a class action lawsuit filed by thousands of businesses that suffered financial losses during the state’s 2020 COVID-19 lockdowns. The lawsuit alleged negligence in the hotel quarantine program allowed the virus to spread, triggering a second wave and prolonged restrictions from July to October 2020. The settlement was reached just before a trial was set to begin on March 10, 2024, avoiding further legal proceedings. Around 16,000 businesses registered for the claim, though eligibility assessments are ongoing. The government, including former ministers Jenny Mikakos and Martin Pakula, was named in the lawsuit. Lawyers for the businesses praised the settlement as recognition of their hardship, while government officials defended pandemic responses as necessary under unprecedented circumstances. The deal must still be approved by the Supreme Court of Victoria before funds are distributed.
✓ Verified by 2+ sources
Key details reported by multiple sources:
- The Victorian government agreed to pay $125 million to settle a class action lawsuit brought by businesses financially impacted during Victoria’s 2020 COVID-19 lockdowns.
- The class action was launched on behalf of approximately 16,000 registered Victorian businesses affected by the state’s second wave lockdown (July–October 2020).
- The settlement was reached on the eve of a trial scheduled to begin on March 10, 2024, which was subsequently adjourned after the agreement was announced.
- The lawsuit alleged negligence in Victoria’s hotel quarantine program allowed COVID-19 to escape, triggering the second lockdown and business losses.
- The legal action named the State of Victoria, former health minister Jenny Mikakos, former jobs and trade minister Martin Pakula, and key public servants in Health, Human Services, and Jobs departments.
- Damian Scattini (Quinn Emanuel Urquhart & Sullivan) stated the settlement concluded ‘years of hard-fought litigation’ and recognized the hardship faced by Victorian retail businesses during July–October 2020.
- The settlement must be formally approved by the Supreme Court of Victoria before funds can be distributed to eligible businesses.
Points of Difference
Details reported by only one source:
- The $125 million settlement was described as agreed to ‘to protect against protracted legal proceedings that would have come at a high cost’ by Victorian government frontbencher Gabrielle Williams.
- Williams stated the global pandemic was unprecedented and the government did its best with the knowledge available at the time, comparing actions to those taken by other governments worldwide.
- The article notes the settlement is yet to be approved by the Supreme Court of Victoria and highlights the trial was due to begin on March 10, 2024.
- 30 percent of the $125 million settlement will go toward legal costs and litigation funders, according to lawyers representing the class action.
- The article mentions the lawsuit was described as ‘novel, complex, and risky,’ with damages claimed reaching up to $2.6 billion, though the settlement was $125 million.
- The trial was abruptly postponed six days before the settlement was announced, with the adjournment occurring on Monday (the day of the settlement announcement).
- The settlement amount of $125 million is described as ‘inclusive of everything, costs, interest’ by barrister Adam Hochroth SC, representing the class action.
- The Guardian specifies the lead plaintiff in the class action was 5 Boroughs NY Pty Ltd, a retail business.
- The settlement approval application was adjourned to a date to be fixed, with the terms of the settlement deeds remaining confidential at the time of reporting.
Where the reporting differs
Details that conflict, or appear in only some outlets:
- ABC states the settlement was agreed to ‘to protect against protracted legal proceedings that would have come at a high cost,’ while NEWSCOMAU does not mention cost avoidance as a primary reason for the settlement.
- NEWSCOMAU reports 30 percent of the settlement will go to legal costs and litigation funders, but ABC and the Guardian do not specify this percentage breakdown.
- The Guardian notes the settlement amount is ‘inclusive of everything, costs, interest,’ but ABC and NEWSCOMAU do not explicitly confirm this detail.
- ABC and NEWSCOMAU both mention the trial was adjourned due to the settlement, but NEWSCOMAU specifies the trial was postponed six days before the settlement announcement, while ABC does not provide this exact timeline.
- The Guardian mentions the settlement was announced outside court on Monday, while ABC and NEWSCOMAU do not specify whether the announcement was made inside or outside court.
Source Articles
Victorian government to pay $125m to settle COVID class action
The state government has agreed to a $125 million settlement, which has to be approved by the Supreme Court.
Businesses affected by one of world’s longest Covid lockdowns to receive $125m from Victorian government
Class action settles after retailers argued state government should pay them for economic loss resulting from pandemic lockdown Businesses affected by one of the world’s longest Covid-19 lockdowns will receive $125m from taxpayers after a state government agreed to settle the matter. A class action was brought in the supreme court on behalf of businesses affected financially by Victoria’s 2020 lockdowns. Continue reading...
Victoria to pay $125m Covid settlement
Taxpayers will be slugged $125m after the state settled a class action from businesses over Covid lockdowns.
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