FEDERAL COURT OF AUSTRALIA

Fowkes v Boston Scientific Corporation [2023] FCA 230

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 33V(1) of the Federal Court of Australia Act 1976 (Cth) (FCA Act), the settlement of the proceedings between the parties on the terms set out in the Settlement Deed executed 12 July 2022 (as varied by the Deed of Variation of Settlement Deed executed 26 October 2022) be approved.

2.    The settlement approval in Order 1 is subject to the separate and later determination of what orders should be made as are just with respect to the distribution of the money paid under the settlement pursuant to s 33V(2) of the FCA Act. 

3.    Within seven days any party opposing the appointment of a referee to put the administration of the settlement to tender file and serve submissions.

4.    The proceeding be stood over for a case management hearing on a date to be fixed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

LEE J:

A    INTRODUCTION AND BACKGROUND

1    In Abbott v Zoetis Australia Pty Ltd (No 2) [2019] FCA 462; (2019) 369 ALR 512 (at 513 [1]), I observed that class actions come in an array of shapes and sizes; they might be open or closed, funded or unfunded; group membership may be very limited or exceedingly vast; the individual claims may be modest, or they may be significant; the subject of the claim may be of signal public importance, or no more significant than a joint enterprise seeking to use litigation as a means to make money; the claims advanced may be dodgy, or they may be dripping in merit; and the group members may be the poor and dispossessed, or as rich as Croesus, they may be natural persons, or artificial (or a combination of both).

2    It is important at the outset of this settlement approval application to understand the bespoke characteristics of this action. It is one of several representative proceedings commenced on a speculative fee basis against the manufacturers and suppliers of pelvic mesh implants designed to treat stress urinary incontinence (SUI) or pelvic organ prolapse (POP).

3    Ms Debra Fowkes, the representative applicant, brings a claim on her own behalf and on behalf of group members against the foreign manufacturers of identified pelvic mesh implants, Boston Scientific Corporation, and the Australian supplier, Boston Scientific Pty Limited (collectively, Boston).

4    Ms Fowkes alleges that the evaluation and supply of the implants were undertaken negligently, the implants manufactured and supplied were defective products and were not of acceptable quality, and that their use carried the risk of complications not the subject of sufficient warnings. Damages and statutory compensation are sought. Ms Fowkes represents an open class of women who had surgery in Australia to have one or more of the implants inserted, and were supplied those implants by a treating hospital or doctor for the treatment of SUI or POP. Importantly, persons need not have experienced any complication to fall within the group member definition. After a very extensive process of identifying women likely to be group members, a sub-set of 2,404 group members (Participating Group Members) have taken the active step of becoming registered and have been confirmed as recipients of one or more of the implants.

5    The parties seek approval of the proposed settlement of the proceeding pursuant to s 33V of the Federal Court of Australia Act 1976 (Cth) (FCA Act).

6    Over the course of case managing and hearing the s 33V application, as it turned out, settlement approval applications were filed in Gill & Ors v Ethicon Sàrl & Ors (NSD 1590 of 2012) (Gill Proceeding) and Talbot v Ethicon Sàrl & Ors (NSD 310 of 2021) (Talbot Proceeding), two other class actions in my docket, both brought against the manufacturers and suppliers of pelvic mesh implants.

7    The Gill Proceeding was the trailblazer pelvic mesh action. It resulted in liability findings by Katzmann J in negligence, and as to product liability and misleading and deceptive conduct pursuant to the Trade Practices Act 1974 (Cth) (Trade Practices Act) and the Competition and Consumer Act 2010 (Cth) (Competition and Consumer Act). These findings were upheld on appeal, and special leave to appeal to the High Court was refused: Gill v Ethicon Sàrl (No 5) [2019] FCA 1905; Ethicon Sàrl v Gill [2021] FCAFC 29; (2021) 288 FCR 338; Ethicon Sàrl v Gill [2021] HCATrans 187. The liability findings in the Gill Proceeding were a touchstone for settlement negotiations and submissions on the settlement approval application in this proceeding.

8    While my usual inclination when faced with applications of this kind is to deliver judgment as quickly as possible, the parallel progression of these cases gave me some pause.

9    There are fundamental differences between the proceedings, the most obvious and critical being the liability findings in the Gill Proceeding (which apply in the Talbot Proceeding), as compared with the fact that Boston has not admitted liability and no findings have been made in this case. But there are also a great number of legal and factual similarities, most notably the human element, which was brought into sharp focus at all points in the settlement approval process and reflected in the large number of written and oral objections the Court received from group members. Accordingly, while keeping these differences between the proceedings firmly in mind, there was some sense in writing and delivering the judgments in tandem: see Gill v Ethicon Sàrl (No 10) [2023] FCA 228 (at [4]–[5]).

B    SCOPE OF REASONS

10    It is important to clarify at the outset the task before the Court.

11    I have written at length elsewhere about the Court’s supervisory and protective role in class actions: see, for example, Dyczynski v Gibson [2020] FCAFC 120; (2020) 280 FCR 583 (at 628 [402]). At all stages during the currency of a representative proceeding, the Court is required to be alive to the interests of group members and to take steps to ensure that matters are conducted in a way which best facilitates the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible: LCM Funding Pty Ltd v Stanwell Corp Ltd [2022] FCAFC 103; (2022) 292 FCR 169 (at 175 [22] per Lee J).

12    So much is reflected in the terms of s 33V:

33V    Settlement and discontinuance – representative proceeding

(1)    A representative proceeding may not be settled or discontinued without the approval of the Court.

(2)    If the Court gives such an approval, it may make such orders as are just with respect to the distribution of any money paid under a settlement or paid into the Court.

13    The provision is directed towards protecting non-party group members who are not represented on the substantive settlement application. Their interests trump the individual concerns of the protagonists who have a joint interest in obtaining a settlement approval: Australian Securities and Investments Commission v Richards [2013] FCAFC 89 (at [7]–[8] per Jacobson, Middleton and Gordon JJ). As I noted in Dyczynski v Gibson (at 628 [402]), this supervisory role is a modern and far more specific mirror of Chancery’s parens patriae jurisdiction, whereby courts of equity could make a diverse range of orders for the protection of children and persons historically regarded as incapable (who could not be heard in a suit before the Court).

14    The Court has power to bifurcate the settlement approval process consistently with the distinct powers in s 33V(1) and s 33V(2) of the FCA Act. That is to say that the Court may approve the settlement and defer for subsequent consideration the further question of the distribution of the settlement sum pursuant to any settlement scheme, including as to unpaid legal costs and disbursements. This conclusion follows from the text and conditional permissive language of s 33V(2): Davis v Quintis Ltd (Subject to Deed of Company Arrangement) [2022] FCA 806 (at [3] per Lee J); Botsman v Bolitho [2018] VSCA 278; (2018) 57 VR 68 (at 111 [198]–[203] per Tate, Whelan and Niall JJA).

15    I recently remarked in Sanda v PTTEP Australasia (Ashmore Cartier) Pty Ltd (Settlement Approval) [2023] FCA 143 (at [18]) that in some cases, it will not be possible to form a view on whether a gross settlement sum represents a result which is fair, reasonable and in the interests of group members without identifying with some specificity the net amount that will be paid to each group member. In other cases, however, it may be possible to form a view that the proposed settlement is of such a character as to commend settlement irrespective of the precise quantum of funds to be the subject of payment out of the fund approved by the Court. In this latter scenario, the Court can proceed to consider the headline settlement figure in the comfort that the only deductions which will subsequently be made will be just deductions from the proceeds of settlement.

16    During the course of argument, the settlement approval application was put on the basis that Ms Fowkes’ position was all or nothing (that is, the settlement deed and proposed settlement scheme were to be taken together). When the matter returned before me in late February 2023, however, the parties consented to my proposal that the approval process be bifurcated.

17    My rationale was to give certainty to group members as to whether the proceeding would settle or not. However, as became clear in the course of argument, significant questions attended the settlement scheme and proposed orders for the distribution of funds paid out of the settlement fund.

18    Accordingly, I have refrained from setting out the terms of and submissions as to scheme proposed by Ms Fowkes’ solicitors, Shine Lawyers (Shine) and Shine’s costs and disbursements, so as to avoid any confusion as to what is being approved today. Those issues are matters for another day, and the course I propose to take in respect of them is outlined below in Section H.

C    THE SETTLEMENT DEED

19    In late April 2022, an in-principle settlement was agreed in the United States. Shortly thereafter, Shine, a listed law firm, commenced negotiating and drafting a deed of settlement (the first draft having been prepared by Boston) which was settled by counsel for Ms Fowkes.

20    A thorough and accurate summary of the settlement deed and its inception was provided by counsel for Ms Fowkes. The following draws upon that summary (and generally defined terms used are as defined).

21    The deed contemplates that a sum $105,000,000 will be distributed to Ms Fowkes and the Participating Group Members. The balance of the group members will have their individual claims, such as they are, extinguished upon orders being made approving the settlement.

22    The deed which, for reasons difficult to understand, was initially agreed to by Ms Fowkes, purported to impose upon group members several legal obligations. These included swingeing releases (cl 7) of an array of non-parties (see cl 1.1 for the definition of “Related Party(ies)”); a requirement to provide broadly drafted indemnities (cl 12); and, most remarkably, provisions (cll 27, 29) which required group members: (a) to acknowledge that Boston maintains they would have been successful in the class action; (b) not, without the approval of Boston, to make any adverse, critical or disparaging statements to anyone about the implants; and (c) if they did make such a statement, to return any amount paid to them pursuant to the settlement and be barred from recovering any sum against Boston (in effect, a “gag”).

23    Very real questions arose as to the legality of a representative applicant agreeing to a regime that would have imposed such obligations upon strangers to the deed. The position taken by Boston was that a representative applicant may bind members to the terms of a settlement deed if: (a) such terms are ancillary, reasonably tailored and proportionate to achieving the primary aim of settling the proceeding; and (b) the terms are approved by the Court pursuant to ss 33ZF or 33ZB of the FCA Act. I made it plain during the course of the hearing that I was prepared to reserve a question pursuant to s 25(6) of the FCA Act to allow a Full Court to determine whether a number of cases which have countenanced similar impositions on non-parties were correctly decided or whether the true position is as I explained it in Clark v National Australia Bank Limited (No 2) [2020] FCA 652 (at [24]) and Dyczynski v Gibson (at 676–677 [396]–[398]) (see also 643–644 [244]–[247] per Murphy and Colvin JJ).

24    In the end, this was unnecessary because sensibly (and perhaps seeing the way the wind was blowing) the parties agreed to a Deed of Variation of Settlement Deed (Amended Deed) removing provisions which sought to impose obligations on group members. Approval is now sought for the settlement as varied by the Amended Deed, the key features of which are as follows.

25    First, the settlement sum is to be held in an interest-bearing controlled monies account pending final settlement approval.

26    Secondly, settlement is on a no admission basis. Clause 15 provides that “nothing in this Deed constitutes an admission that, but for the terms of this Deed, any Party would have had any liability to any other Party”.

27    A third feature that should be specifically remarked upon (although not forming part of the first stage of the approval process) is the proposed prioritisation of reimbursement payments to third party payers ahead of any payments being made to Participating Group Members. Prioritisation is effected by a contractual prohibition contained in cl 6.2. The prohibition applies to the scheme administrator, who is not to make any payments to Participating Group Members prior to confirmation that all reimbursements that are required to be made to third party payers has occurred in accordance with cl 9.6.

28    As such, the settlement sum is inclusive of all amounts that could be payable to third parties as a consequence of the proposed settlement (cl 9.1), including amounts payable under the Health and Other Services (Compensation) Act 1995 (Cth), Social Security Act 1991 (Cth), Veteran’s Entitlements Act 1986 (Cth), National Disability Insurance Scheme Act 2013 (Cth) or any other statute under which Boston may be liable to pay a government body an amount arising from or in respect of the settlement. In this regard, third party payers such as Medicare and Centrelink are to be notified of the settlement within 28 days of approval (cl 9.2). These third party payers are (somewhat bizarrely) referred to as Lienholders (even though they hold no lien known to Australian law). It appears that this language imports that used in the settlement of class actions in the United States where, under certain legislation, Medicare or Medicaid could assert a statutory lien over the settlement sum: see, similarly, Stanford v DePuy International Ltd [2016] FCA 1452 (at [53] per Wigney J).

29    The scheme administrator is to confirm for the respondent that all liens are resolved and recovery amounts paid (cll 9.5 and 9.6). There is also allowance for the possibility that the settlement administrator may agree and give effect to a bulk payment arrangement with a lienholder (cl 9.4).

30    Fourthly, the Amended Deed provides a complete defence to any action, proceeding or suit which may be taken by a party in connexion with or incidental to this proceeding.

D    PRINCIPLES INFORMING THE COURT’S DISCRETION TO APPROVE A PROPOSED SETTLEMENT

31    In settlement approval judgments, I usually eschew setting out the well-known principles informing the discretion to be exercised under s 33V. They are distilled in Camilleri v The Trust Company (Nominees) Limited [2015] FCA 1468 (at [40]–[45] per Moshinsky J) and Lifeplan Australia Friendly Society Limited v S&P Global Inc (Formerly McGraw-Hill Financial, Inc) (A Company Incorporated in New York) [2018] FCA 379 (at [12]–[15] per Lee J). But this case has some unusual features and it is worth revisiting (and then expanding upon) some basic concepts.

32    Section 33V does not set out a test for determining whether approval should be granted. As Branson J noted in Australian Competition and Consumer Commission v Chats House Investments Pty Limited (1996) 71 FCR 250 (at 258):

The purpose intended to be served by s 33V(1) is obvious. It is appropriate for the Court to be satisfied that any settlement or discontinuance of representative proceedings has been undertaken in the interests of the group members as a whole, and not just in the interests of the applicant and the respondent.

33    The Court’s “principal task is to assess whether the compromise is a fair and reasonable compromise of the claims made on behalf of the group members” (Lopez v Star World Enterprises [1999] FCA 104; (1999) ATPR 41-678 (at 42,670 per Finkelstein J)) and “to ensure, by Court scrutiny, that a settlement acceptable to a representative party accommodates the interests and circumstances of group members”: King v AG Australia Holdings Ltd [2002] FCA 872; (2002) 121 FCR 480 (at 493 [42] per Moore J).

34    While some decisions of this Court (in particular, Williams v FAI Home Security Pty Ltd [2000] FCA 1925; (2000) 180 ALR 459 (at 465–466 [19] per Goldberg J)) have identified factors which may “ordinarily” be a useful “guide” in determining whether a settlement should be approved, there is no definitive “checklist” of mandatory considerations.

35    For example, in Darwalla Milling Co Pty Ltd v F Hoffman-LA Roche Ltd (No 2) [2006] FCA 1388; (2007) 236 ALR 322, Jessup J considered that some of the relevant factors identified in Williams could not sensibly be applied (at 333–334 [33]–[35]). In particular, his Honour noted that by reference to the proposed settlement distribution scheme in that case, neither the Court nor the applicant could determine what the final entitlement of each group member would be under the settlement. His Honour also noted that it was difficult to reach any measure of the likelihood of the group members obtaining judgment for an amount significantly in excess of the settlement offer, the settlement being based on “rules of thumb” and assumptions which the Court may well consider to be fair and reasonable as a means of disposing of the issues with which the group members as a whole were confronted in that litigation (at 333–334 [34]). By itself, this is not an insuperable difficulty for a settlement, as experience demonstrates that a number of cases have been resolved by applying a formula for loss, which is set out in a distribution scheme, and part of the role of the Court is assessing whether a fair and reasonable method for calculating the loss sustained by each group member has been developed.

36    In Darwalla, Jessup J (at 336 [41]) proceeded on the basis of considering whether the overall settlement sum was reasonable having regard to:

the manner of its calculation and its relationship to the best possible case outcome for the group as a whole; the prospect of achieving an outcome at or near the best possible case; the extent of the weaknesses, substantive or procedural, in the applicants’ case, whether the settlement sum falls within a realistic range of likely outcomes; the forensic difficulties which would be involved in the conduct of the case to judgment … and the time and costs which have been saved by settlement at this stage.

37    In any event, it is clear that a settlement may be approved notwithstanding it is impossible to quantify precisely the full range of damages potentially available to group members.

38    His Honour also had regard to “the question of whether the settlement, including the distribution scheme, involves any actual or potential unfairness to any group members” and an analysis of the formulas and procedures relevant to the proposed distribution scheme (at 336 [41]). The practical judicial approach, as his Honour observed (at 335 [39]), is to identify any features of a settlement that are obviously unreasonable or unfair and that, where some group members object to a settlement and state their reasons, those reasons will provide a convenient focus for the Court.

39    This approach, at least to some degree, is now reflected and supplemented by the Class Actions Practice Note (GPN-CA), which commenced in 2016. The Class Actions Practice Note relevantly provides as follows (at [14.3]–[14.4]):

14.3    When applying for Court approval of a settlement, the parties will usually need to persuade the Court that:

(a)    the proposed settlement is fair and reasonable having regard to the claims made on behalf of the group members who will be bound by the settlement; and

(b)    the proposed settlement has been undertaken in the interests of class members, as well as those of the applicant, and not just in the interests of the applicant and the respondent(s).

14.4    The material filed in support of an application for Court approval of a settlement will usually be required to address at least the following factors:

(a)    the complexity and likely duration of the litigation;

(b)    the reaction of the class to the settlement;

(c)    the stage of the proceedings;

(d)    the risks of establishing liability;

(e)    the risks of establishing loss or damage;

(f)    the risks of maintaining a class action;

(g)    the ability of the respondent to withstand a greater judgment;

(h)    the range of reasonableness of the settlement in light of the best recovery;

(i)    the range of reasonableness of the settlement in light of all the attendant risks of litigation; and

(j)    the terms of any advice received from counsel and/or from any independent expert in relation to the issues which arise in the proceeding.

40    Sub-paragraphs 14.4(a)–(j) of the Class Actions Practice Note broadly reflect the nine point “checklist” derived from United States procedures and referred to by Goldberg J in Williams (at 465–466 [19]). The language of the Class Actions Practice Note also reflects the observations of this Court that such considerations provide a useful guide in the approval process, but noting that each case may well throw up unique considerations.

41    There are very many cases, but three central propositions or themes that run through them can be identified as follows:

(1)    first, the central question is whether the proposed settlement is fair and reasonable in the interests of group members considered as a whole;

(2)    secondly, there will rarely be one single or obvious way in which a settlement should be framed, either between the claimants and the respondents (inter partes aspects) or in relation to sharing the compensation among claimants (the inter se aspects); and

(3)    thirdly, reasonableness is a range. The question is whether the proposed settlement falls within that range; it is not the task of the Court to second-guess or go behind the tactical or other decisions made by the applicant’s legal representatives, but rather to satisfy itself that the decisions are within the reasonable range of decisions, having regard to the circumstances known or knowable; and a reasonable assessment of risks.

42    To elaborate on those interrelated principles, as Jessup J observed in Darwalla (at 399 [50]):

There will rarely, if ever, be a case in which there is a unique outcome which should be regarded as the only fair and reasonable one. In settlement negotiations, some parties, and some advisers, tend to be more risk-averse than others. There is nothing unreasonable involved in either such position and, under s 33V, the court should, up to a point at least, take the applicants and their advisers as it finds them. Neither should the court consider that it knows more about the group members’ businesses than the applicants, or more about the actual risks of the litigation than their advisers. So long as the agreed settlement falls within the range of fair and reasonable outcomes, taking everything into account, it should be regarded as qualifying for approval under s 33V.

43    Further, as Wigney J explained in Stanford v DePuy (at [116]):

Where settlement is reached prior to judicial determination, the assessment of the proposed settlement must be undertaken mindful of the unpredictability of the applicant’s and group members’ fate. In those circumstances, the settlement must be viewed as a pragmatic compromise to the relevant claims. In that regard, the Court should be mindful of the fact that the parties and their legal representatives are often in a better position to appreciate the risks, and also mindful of the fact that different parties and their lawyers will have different appetites for risk.

44    The above observations underscore the importance of not evaluating the reasonableness of a settlement on the assumption that, had the matter proceeded, the applicant’s and group members’ claims would necessarily have been successful. For similar reasons, the reasonableness of the settlement should not be tested solely by reference to the amount that the applicant individually, or particular cohorts of group members, would recover through the settlement. To do so would be to divorce one aspect of the settlement from the tactical and forensic risks associated with attempting to establish the claims of the applicant and group members through an initial and subsequent trials. Due deference should be given to the assessment of those risks by the applicant’s advisers and the element of pragmatic compromise embodied in the proposed settlement.

45    Finally, as is evident, the discretion is a broad one: its exercise is only limited by the necessity that it be exercised judicially, having regard to the particular facts of the case. Factors commonly relevant have already been identified, but if another factor is relevant, it may be taken into account, and the weight to be given to it depends upon the fact’s own intrinsic persuasiveness and its impact on other circumstances, which are also relevant, and consequently have to be weighed. Further, in the exercise of the broad discretion, I am performing a protective function in relation to those parties who are not before the Court: ASIC v Richards (at [7]–[8] per Jacobson, Middleton and Gordon JJ).

E    NOTIFICATION OF AND REACTION TO THE SETTLEMENT

46    Group members were notified of the proposed settlement by way of a Court-approved settlement notice. Given the work that had been done earlier to obtain information as to the identity of group members and how they were best contacted, the process of notification proceeded relatively smoothly:

(1)    a “Notice of Proposed Settlement to Registered Group Members” (Notice of Proposed Settlement) was sent by email (or, where no email address was available, by post) to group members who had registered their claim with Shine, as well as those in respect of whom Shine had confirmed had received, or is likely to have received, one or more of the implants;

(2)    a further “General Notice of Proposed Settlement” (General Notice) and an overview of the settlement was published on a website dedicated to the settlement of this proceeding (being www.bostonmeshclassaction.com.au); and

(3)    the General Notice was published in several Facebook groups relating to the implants.

47    By the time of the hearing, the Court had received, through my Associate, a very large number of comments relating to the settlement, which continued to trickle in. Forty one written communications as to the proposed settlement had been received by my Chambers by the end of the second day of hearing. These communications were uniformly negative in opposing the settlement. Copies were provided to the parties and the communications were received into evidence on the approval application.

48    At the hearing of the approval application, seventeen group members appeared in person or remotely at the hearing to address the Court orally. A copy of all messages exchanged over the Microsoft Teams chat function during the course of the second day of the hearing was also received into evidence.

49    It is important to stress a couple of points concerning the process adopted and the material received from group members.

50    First, at all times during the approval process, I considered it important that any group member who wished to place material before the Court or address the Court have the opportunity of doing so. It must always be borne firmly in mind that we are dealing with real people who perceive they have real claims, and any approved settlement would compromise those claims.

51    In September 2022, I instructed my Associate to write to the parties in the following terms:

In the light of the below objections received by the Court, and the unlikelihood that the objectors will engage legal representation, his Honour’s preliminary view is that it is appropriate that a contradictor be appointed for the hearing of the s 33V application. The Contradictor will not act for those who have objected, but rather will fill the role of amicus curiae.

If any party wishes to be heard prior to the making of an order appointing a contradictor, his Honour requests that they contact Chambers by 12pm tomorrow, 27 September 2022.

52    Ms Fowkes did wish to be heard and opposed the appointment of a contradictor. After a relisting to receive oral submissions and subsequently reviewing the material then filed in support of the application, my Associate advised the parties on 2 October 2022 as follows:

In the light of the material filed on Friday and subsequently reviewed by the Court, his Honour has revised his preliminary view that it is necessary that a contradictor be appointed for the hearing of the s 33V application.

His Honour requests that the solicitors for the applicant provide Chambers with a draft email to be sent by the Court to all objectors inviting them to make an oral presentation as to their objection if they feel comfortable in doing so (or reminding them that submissions can be made on their behalf if they wish). 

53    Emails were sent and group members appeared. In the absence of a contradictor, there was no-one to lead oral evidence on behalf of the unrepresented group members in the orthodox way, and the oral presentations made, naturally enough, contained representations which were an admixture of evidence and submissions. Pragmatically, however, following a request for confirmation made by my Chambers on 12 October 2022, all parties were content for the Court “to act on the basis of the factual representations made, notwithstanding the group members were not sworn”.

54    With the benefit of hindsight, I should have adhered to my preliminary view and appointed a contradictor. The opinion of counsel in this case, discussed below, was a thoughtful and useful document, and although “red flags” with the settlement only emerged or crystallised in my mind during the hearing, in circumstances where it is evident there is likely to be significant opposition to a settlement and group members wish to be heard, the conduct of the hearing can be assisted considerably by the appointment of a contradictor. Costs considerations sometimes loom large, and it is important the Court keeps close control over the process to ensure a contradictor does not go off on frolics or incur unnecessary costs or cause delay (as has sometimes happened). Contradictors can be useful when there is some real controversy over the settlement. Such was the case in the Ethicon and Talbot Proceedings, in which the Court-appointed contradictors brought practical and analytical rigour: Gill (No 10) (at [62]–[63]). Despite not having a contradictor in this case, given the fairness and experience of counsel appearing on the approval, the hearing proceeded smoothly.

55    Secondly, it is important there be certainty as to the material before the Court. All written communications from the group members and written material provided by them was received into evidence without objection and without any application for limitation under s 136 of the Evidence Act 1995 (Cth) (EA). Although s 190 of the EA does not provide for an express waiver of Pt 2.1, Div 2 and, in particular, s 21(1) of the EA (which provides for the taking of oaths or affirmations), both parties, as noted above, expressly consented to the Court having regard to the factual representations presented to the Court by group members. Section 9(1) of the EA (see also s 9(2)(c)) preserves the Court’s power to dispense with the operation of a rule of evidence or procedure in an interlocutory proceeding. Furthermore, given the express consent of the parties, I consider it appropriate to proceed on the basis that the representations made by group members are part of the record.

56    Thirdly, and connected to the second point, there is the distinct question of how the representations of group members should be used. The written and oral objections before the Court were forceful. It was impossible not to be moved by some of the heart-rending stories of despair and physical and emotional pain received. By sharing their stories, the women who spoke brought to the foreground the intimate and human element to this settlement approval application. Naturally enough, each woman providing material made factual assertions as to their experience with SUI or POP and pelvic mesh implants. Assertions were often made about dealings with third parties not before the Court who could not dispute any such assertions, such as surgeons. Representations were also made as to causation and loss. Indeed admissions were sometimes made. More commonly, opinions were sometimes expressed as to the conduct of the class action.

57    I wish to say one or two things about each of the specific oral presentations to the Court during the course of the hearing. In doing so, I do not intend to diminish the importance of the other representations provided to the Court in writing, which I have received into evidence, read and taken into account. But even though no application was made for any limitation on the material received pursuant to s 136 of the EA, I considered it appropriate as between the parties, and fair to non-parties, that one be made.

58    To this end, I raised with the parties, and they agreed, that the use of any representations made by group members in writing or orally be limited such that they not be used for the proof of the underlying truth of the representation (insofar as the representation is relevant to the facts in issue in relation to the individual claim of a group member). Rather, I proposed the representations be used for the purposes of being used as evidence of: (a) opposition to settlement generally; (b) some estimation as to the estimated likely quantum of each of the group member’s claims and of group member claims generally; (c) the subjective view of the group member making the representation; and (d) the status of the group member as a member of the class.

59    I set out below a summary of matters put before the Court by those who made oral presentations. To preserve the anonymity of the persons involved, each woman has been identified by her initials. Although expressed in terms of factual findings, as noted, those findings are limited and should not be taken as a finding relevant to the ultimate disposition of the group member’s claim. It should go without saying that I have formed no view as to whether any group member is entitled to any final relief.

E.1    Ms KA

60    Ms KA provided both a written and oral objection, and is a group member who had implant surgery in 2016, on the suggestion of her gynaecologist, to address some minor incontinence. She spoke movingly about her experiences following the implant surgery. She explained that, unknown to her at the time, the implant triggered a severe foreign body response. She began bleeding from her navel and vagina, she had chronic pain in her back, left hip and leg, and her blood and hair started thinning. She went to see a host of specialists and underwent a range of invasive tests to determine the cause of her symptoms, however, a diagnosis remained elusive. She explained that new symptoms developed during this period, including chest pain, limited mobility, fluid build-up in her lungs, fevers, blurred vision, slurred speech, and memory loss. On account of these afflictions, she was forced to step down as Chief Executive Officer of her company. She spoke of the toll this experience had on her mental health.

61    It was only when she raised the possibility of her implant as the cause of her symptoms that her condition was identified as a foreign body response to the implant, which she had removed in 2018. Although her condition has improved, Ms KA stated that she continues to suffer from daily joint pain and stiffness, and chronic inflammation, for which she takes various prescription medications and continues to see a number of specialists. In December 2021, her husband of 20 years raised concerns regarding her condition, stating “I could end up your carer in the future”. He sought a divorce in the January 2022. Ms KA stated that the implant was a “significant contributor” to the breakdown of her marriage.

62    Ms KA raised an issue about the lack of transparency regarding the proposed settlement distribution, stating that she had only received generic details concerning the settlement process, which has prevented her from making an informed decision on whether the proposed settlement is appropriate. Compounding this concern is the ambiguity surrounding Shine’s proposed “points system” for the allocation of the settlement sum to group members. On the information available, she does not believe the settlement sum will provide adequate compensation to group members, including their Medicare and health insurance expenses. During her oral objections, she wanted the solicitors involved in the settlement negotiations to listen to her story and “see the human being, not just a number in a case”: T8.44.

E.2    Ms KR

63    Ms KR similarly raised concerns about the limited details provided regarding the proposed settlement sum and the operation of the “points system” for the allocation of funds to group members. She has been very active in relation to raising awareness of matters regarding the class action, including by creating a Facebook page. She states that the settlement process has not been transparent and that group members have been left “in limbo” as to whether the proposed settlement is in their interest. Further, she questioned how the settlement amount could be accepted before the medical files of each group member are considered and their individual stories heard.

64    Ms KR dreamed of being able to jump on the trampoline with her children and so, in 2019, she underwent the implant surgery to fix her incontinence. In a manner similarly described by many of the objectors, she stated that she immediately knew something was “terribly wrong” following her surgery. In her written objection, she vividly describes the pain as like having “rubber band attached to blades inside me” as the mesh began to “cut through” her internal organs. Although she had her implant removed in 2019, she says that the effects are ongoing, including chronic pain, damaged nerves, immobility, fatigue, incontinence, and forgetfulness. At the hearing, she explained that she had to step down from her employment as a traffic controller due to her constant pain and incontinence, which left her “feeling like a failure” as she struggled to meet her mortgage repayments. She wrote about the severe toll this has taken on her mental and physical health, and the damage it has had on her relationships with her husband and children, who have been required to care for her. During her oral submissions, she stated that her husband had recently asked for a divorce.

E.3     Ms MS

65    Ms MS had implant surgery in September 2017, and mesh removal surgery in December 2018. She experienced some difficulties in relation to providing her objection by the cut-off date and made a request that the Court allow her to provide written and oral objections. I directed my Associate to write to Ms MS advising that she was allowed to provide written and oral objections, and invited her to share the details of the hearing with other group members who may wish to observe or participate in the hearing.

66    Ms MS raised her concerns with the settlement amount, stating that she did not consider that it would adequately compensate her for the permanent damage to her physical and mental health, medical expenses, and pain and suffering. At the hearing, she stated (T36.29–30):

I do not believe the lawyers who negotiated it have represented our best interests in this class action, as I do not believe they have negotiated enough settlement money.

67    She spoke about how her life changed radically following her implant surgery. She explained that she has suffered from chronic and severe pain every day from the complications of the surgery, which she described as a “burning hot poker of pain that would tear through my body whether I tried to sit, stand, walk or lie down”: T31.26–27. She says that the surgery caused damage to her urethra, which made her incontinence far worse, such that she now requires daily incontinence products. She also spoke of the numerous invasive medical procedures that she underwent as part of the investigations to get to the source of her pain, the cost of which she estimates was $100,000 (including Medicare and health insurance expenses).

68    Ms MS says that she has been unable to work full time due to chronic pain, which has caused her to suffer setbacks in her career. She can no longer perform everyday household duties, and requires the assistance of a cleaner. She explained that her husband was “thrown into the role of [her] carer” following the removal surgery, and their relationship has changed drastically. She is no longer able to be intimate with him, and says “the future that we thought we were working towards has had to change drastically”: T32.25–29. Since the surgery, she has struggled with post-traumatic stress disorder, anxiety and depression, brought on by the “severe complications from the mesh surgery”: T32.40–41.

E.4    Ms BA

69    Ms BA provided both a written and oral objection, and is currently a group member who had implant surgery in January 2021 for stress incontinence. Following the surgery, her incontinence worsened, to the extent that it now limits her social movements and travel. During the hearing, she explained (T37.26–30):

… ever since the surgery there have been a general feeling of being very unwell, and I often walk around in a fog, which I thought I was going crazy, but apparently that’s something that happens. There’s also – my husband, who is now my carer, we live in separate rooms. There is no intercourse, and I need to sleep alone due to pain.

70    It was apparent Ms BA’s concerns regarding the proposed settlement, in part, stemmed from her uncertainty as to what treatments are available for her condition and what the future holds. Due to COVID-19 restrictions, Ms BA has been unable to undergo investigative or elective surgeries, and is currently reviewing her options for investigative surgery in the private health system. She is greatly concerned the settlement amount is insufficient to compensate group members for their Medicare expenses, treatment and surgeries in the private health care system, legal fees and for the devastating effect that the implant surgeries have had to their lives.

E.5    Ms LP

71    Ms LP had surgery in 2017. She made moving oral submissions, and suffered some distress in doing so. In any event, since the surgery, she has suffered from incontinence and wakes up numerous times of a night to go to the toilet. Due to the impact on her sleep, and the embarrassment she feels from constantly needing to go to the toilet, she suffers from depression and anxiety, for which she has sought professional help.

E.6    Ms SP

72    Ms SP underwent a vaginal hysterectomy and tension free vaginal tape procedure in 2012. In her written objection, she explained her long journey, including numerous emergency trips to the hospital and referrals to a number of specialists in order to determine the cause of her chronic pain and complications following the surgery. This included convincing medical practitioners that the pain was not “in her head”. Her summary of her experience was expressed in poignant terms:

Not a day goes by that I don’t regret it. It was supposed to give me a better quality of life and instead it sent me on a journey of pain. There were times when I have felt completely helpless as the medical field could not find what was wrong with me. I felt like I was screaming into the wind and no-one could hear me. I have unfortunately at times had suicidal thoughts as I didn’t want to live like this anymore. I had hoped once I had all the mesh taken out I would have been left pain free with a normal pain in my urethra and nerve damage in my pelvis. I just now live without mesh in my body.

73    Ms SP now resides in the United Kingdom. She takes antibiotics three to four times a day to prevent frequent urinary tract infections. Sexual intercourse exacerbates her condition, and she feels that her only option is to abstain. This has left her feeling very depressed, stating: “I have now lost my womanhood and live with the constant worry that my husband may leave me one day”.

74    In the light of her experience, she feels that the “paltry amount” each of the group members will receive under the “points system” is an insult, and does not consider the settlement sum is enough to compensate group members fairly for what they have each gone through.

E.7    Ms RW

75    As a result of her surgery, Ms RW stated that, between 2013 and 2019, she spent the majority of her time in bed and required the assistance of her stepdaughter in running her business. This had a negative impact on Ms RW’s marriage, and her life with her children. During this time, she struggled to convince medical practitioners of the chronic pain she was experiencing, stating that “nobody [was] listening to what I was saying”. Due to this, she sought psychiatric care and was prescribed numerous medications for depression and anxiety.

76    Ms RW raised concerns as to the process by which group members were informed of how they could make objections at the hearing, the details of which she received from fellow group members. She also raised an issue as to the limited information she had received regarding the likely settlement distribution.

E.8    Ms ET

77    Ms ET expressed her dissatisfaction with the proposed settlement. In her written objection, she explained that, following her surgery in 2015, she experienced “terrible pain and nausea” and “extremely painful and difficult bowel movements”, which she was told were unrelated to her surgery. She detailed how her symptoms have worsened, including chronic pain in her back, groin, buttocks and legs, bowel spasms, and urinary incontinence. These symptoms have taken a considerable toll on her quality of life and mental health. She is unable to have coitus due to the intensity of the pain, and now requires a disability mobility walker due to the debilitating cramps that have left her unable to walk, stand or breathe normally due to the diaphragm connexion to the pelvic floor. Ms ET also described that her condition, and the need to rely on the goodwill of others, has been “debilitating, humiliating, and devastating”.

78    She says in her written objection that she left Tasmania to be closer to specialists who could investigate the cause of her symptoms. In explaining why she eventually settled in Queensland, she stated:

I moved to a warmer climate in an attempt to lessen the severity of spasms and to move far away from my grown up children so they don’t feel they have to look after me. I want them to have the opportunity to move forward with their own lives, not have to care for an invalid parent! I moved away from my friends and career colleagues. I don’t want them to see me debilitated like this, or to feel obligated to look after me. I was a single parent. I learnt to be self-sufficient. I struggle on alone.

79    Ms ET feels strongly that the settlement sum is unjust in the light of the problems that group members have been experiencing “throughout this ongoing journey”: T64.19–20. At the hearing, she raised her concerns regarding the non-disclosure clause initially proposed in the settlement agreement, stating that it would “pull the wool over the eyes of the public” and prevent women from sharing their stories and raising public awareness of the “horrific and ongoing damage” that their implants have had on their lives: T64.32–39. In her written objection, she stated:

I personally do not accept these terms. This settlement figure has caused greater emotional and mental anguish, particularly after so many years in the battle to be heard. I beg of you, please hear and act on our plea!

E.9    Ms TW

80    Ms TW appeared remotely at the hearing. She received an implant from another manufacturer in 1998 and, in 2011, had a Boston clinical prolapse kit surgically implanted. She has been involved in raising awareness and providing support for those said to be affected by mesh products, including through a number of awareness groups. She raised a specific concern that under the proposed settlement, Boston does not accept liability. She feels that the settlement sum is insufficient to compensate group members for their future medical costs, calling it an “insult”. She cited a specialist report that she had received, which suggested that her future medical treatment will cost thousands of dollars, which she is unable to afford on her disability pension. She summarised her position, and the position of other group members, as follows (T53.25–43):

So literally I’m the one that falls through the crack. We all fall through the cracks because there’s just no help. … We’re under treated, under medicated, and we literally pay for our own lives out of our own pocket, which is really not fair.

E.10    Ms JD

81    Of the objectors who spoke, Ms JD was the last to have had an implant procedure, in 2019. A young woman, she recalled feeling embarrassed when she went to see a surgeon to treat her incontinence, which began after the birth of her third child. She spoke of this embarrassment worsening after her operation (at T59.46–60.3):

[I] [w]asn’t able to do things with my daughters. You know, no social life, no love life. It has just been terrible.

And the scary thing is, you put your life in these professional’s hands for them to better you, not come out on the other side and feel terrible and in pain constantly.

82    Prominent in Ms JD’s submissions was a desire for an admission of liability, and feelings of having been betrayed by medical professionals, not having her condition taken seriously, and not being believed. She described feeling “hurt”, because the medical practitioners with whom she deals “don’t live within my body to feel the pain that I’m feeling”. When she did have further surgery, she was told that “everything ha[d] been fixed”. Yet, she presently feels that she does not “know, to be honest, if it’s actually come out of me or if it’s still in me, but as I stand here, as I’ve been sitting there, I’m still constantly in pain”.

83    Ms JD spoke of financial and family pressures. She spoke of constant medical visits and being unable to hold employment. She does not want to be a “burden” for her children or for her parents who have to care for her, stating that she feels that she “should be caring for them at this age”. She is a single mother who now feels unable to be a “strong female role model” for her three daughters, which has left her feeling depressed and unhappy. Her submissions were powerfully delivered.

E.11    Ms MP

84    Ms MP had surgery in 2019, and has had six operations thereafter. She movingly made oral submissions as to the impact this has had on her working and personal life. She spoke of her “little fish and chips business” that she had to sell because she is no longer able to stand and work for an entire day, and how she is no longer able to pursue her hobbies, like gardening and cooking. Her family life has also suffered. She explained the emotional pain of having to sleep in a separate bed from her husband of 40 years, and their eventual separation, which she described as the “last nail”. Due to her incontinence, she is unable to travel long distances, which has prevented her from seeing her grandchildren.

85    Ms MP has had communications with Shine, and has been provided with an estimate of the likely amount payable to her pursuant to the settlement. Ms MP was somewhat conflicted as to whether she objected to the proposed settlement. Although ultimately objecting to the proposed settlement, she expressed her desire for the matter to be resolved, and her concerns with how long the resolution alone will take. Nevertheless, she expressed her dissatisfaction with the proposed settlement sum she would likely receive, which she did not consider to be sufficient in the light of her pain and the relationships she has lost.

E.12    Ms JM

86    Ms JM provided detailed written objections and appeared on the second day of the hearing to give an oral objection. Overall, she expressed her primary concern that she has not been consulted as to her medical records, and the proposed distribution schedule is not a true reflection of her needs. She raised issues with the precision of the distribution schedule. She received a draft schedule from Shine, which indicated her complications would be classified as mild, moderate and severe. She raised issue with the fact that, for example, the schedule did not take into account the fact that she underwent surgery for her implant twice, or that, although her medication is classified as mild, she will require it for life. Equally, she considers that any amount she will recover if the proposed settlement is approved will be insufficient to cover her medical expenses, and raises concerns as to her Medicare and private health expenses. This concern appeared to be emphasised in the light of what she described as the “huge sum” proposed to be paid to Shine.

E.13    Ms RH

87    Ms RH appeared virtually from the school at which she teaches. She emphasised the difficulty in calculating compensation for the pain that she and others like her have gone through: marital breakdowns, mental trauma, inability to exercise and “stonewall[ing]” by the medical profession: T22.44–23.13.

E.14    Ms CP

88    Ms CP recalled watching television programmes as a child “about mesh surgery and the devastating effects of it on women”: T23.41–43. This caused her to “drill” her doctor to ensure she would not endure such suffering: T23.44. She movingly summarised her position as follows (T23.45–46): “I did all my research. I went to several different doctors, and then come to find out that I’m in the same position.” She considers herself “lucky”, given her husband maintains a stable income and they have private health care: T24.31. Even then, she feels that the settlement is not nearly enough to cover the emotional dread caused by her condition.

E.15    Ms SK

89    Ms SK appeared at the hearing to give an oral objection, in reliance on those she had already provided in writing. She took issue with some of the calculations underlying the settlement proposal, particularly with regard to the bands which would apply to certain group members. She said that she “personally believe[s] there are more than 10% of women allocated in the most severe bands of 5 and 6”, and that accordingly the proposed settlement is not “fair and reasonable” and is “way off the mark”.

E.16    Ms KR

90    Ms KR made oral submissions at the hearing. She underwent a procedure in 2011, and made moving submissions about the serious and deleterious effect it has had on her. Ms KR expressed that the procedure had only served to exacerbate traumatic experiences in her life, including post-traumatic stress from rape and abuse, and health issues dating back to her childhood. Following the surgery, Ms KR said that that her family life suffered immensely. She expressed how her marriage broke down, which in turn impacted her child who suffers from anorexia.

91    Ms KR emphasised that the settlement “needs to be fair”. She said that it should take into account the vicissitudes associated with the harmful effects of the surgery going into the future, particularly given the significant impact that the surgery has already had upon on all aspects of her life. Ms KR also noted the shared experience of women who underwent the surgery, and said that “I’m sure there’s a lot of women out there in that same boat with that uncertainty of going, ‘Well, I don’t tick that box exactly, but I’m having the symptoms’”.

E.17    Ms TW

92    Ms TW appeared remotely on the second day of the hearing. She summarised her position, and the position of many other group members, as follows (T20.26–37):

I am now a part-time parent because my husband has left me because of my injuries, my ongoing illnesses, my incontinence, my medical appointments. I have to work full time because I can’t support my family if I don’t, and I can’t work full time any more; it is killing me. … I don’t have health. I can’t go out and weed my garden. I can’t go out and do anything. I need people to drive me around when it’s long distances. Like, the effects that this has had on our lives is huge.

93    It was clear to me that one of her primary concerns was paying for her ongoing medical expenses. She spoke of the distress of having received a letter from Medicare detailing her current debts, as well as the impossible choice of whether to take stronger medication for her chronic pain, knowing that it would mean taking “money away from [her] children” and her “ability to buy [her] husband out of my house that [they] built together”: T21.6–8.

E.18    Group Member Submissions Generally

94    I have only referred to those who made oral representations during the course of these reasons. Those comments were representative of the communications my Chambers received from group members generally. I am conscious of how difficult it was for some of those who appeared or wrote to tell me their stories. Others similarly placed may have been too embarrassed or shy to do so. I have reviewed carefully all the written representations that were made, including those provided during the course of the hearing.

95    No group members came forward to make oral or written submissions to support the settlement. Ms Fowkes did not give evidence. Although initially I had indicated that I wished to minimise costs by reducing the material filed on the settlement application, when it became clear on the first day of the hearing that there was significant group member opposition, on 12 October 2022 (after receiving confirmation that the Amended Deed had been agreed), I instructed my Chambers to communicate with the legal representatives of the parties in the following terms:

His Honour has directed me to write to the parties and will provide a copy of this communication to the group members who appeared at the hearing of the part heard s 33V settlement approval application (application).

His Honour considers it appropriate to re-list the hearing of the application for receipt of any further evidence (including the signed deed [of] variation) and for the purposes of any further argument.

The applicant has leave to re-open to file any additional evidence upon which she relies in relation to the application.  In this regard, when the application was initially foreshadowed, his Honour indicated that he would prefer only limited material to be provided to the Court (24.8.22; T7).  In all the circumstances, however, the applicant should now proceed on the basis that she is not constrained in any way, and at the resumed hearing, she should place before the Court any additional material upon which she proposes to rely to seek approval.

Additionally, at the resumed hearing, his Honour would be assisted, not only by the notes that were foreshadowed by Ms Hillman, but also by the following:

1.    A schedule setting out the estimated amounts to be paid pursuant to the settlement to four identified group members as compared to the best case recovery the group member would receive if their claim was litigated to a conclusion and damages or statutory compensation was awarded together with interest as at 1 December 2023.  In this regard, some work in this regard was performed in relation to Ms Atkinson.  If they are agreeable, his Honour would be assisted if the schedule was prepared in relation to [MS KA, Ms JD, Ms KR and Ms LP] (recognising that the amounts payable pursuant to the settlement and the “best case” recovery can be no more than relatively “rough” estimates).  These group members have been chosen randomly, so if any of these ladies do not want to provide sufficient details to allow the proposed exercise to be undertaken, his Honour is happy that the schedule be provided in relation to other objecting group members who made presentations before his Honour.

2.    Confirmation that the parties are content for his Honour to act on the basis of the representations made by the objecting group members, even though the representations made were a mixture of evidence and submissions.  In other words, whether the parties are content for his Honour to act on the basis of the factual representations made, notwithstanding the group members were not sworn.

3.    Further and more complete details as to the total estimated recovery for group members including interest, and detailed explanation of the premises upon which such an estimation is based.  

(Emphasis added).

96    Some additional material was filed, but no material was filed by the applicant from a group member providing evidence supporting the settlement. Again, no group members came forward on their own account to do so, nor did Ms Fowkes revisit her decision not to give evidence.

97    There was some attempt to lead evidence as to group member support in the evidence filed shortly before the resumed hearing. That evidence constituted further affidavits from each of the solicitors with carriage of this proceeding for Ms Fowkes (at that time, Ms Rebecca Jancauskas and Ms Janice Saddler). Aspects of this evidence was less than satisfactory.

98    Ms Saddler gave evidence that it is more likely than not that most of the over 2,400 group members who did not attend Court and did not seek to be heard on the proposed settlement received notice and “did not wish to be heard in opposition to the proposed settlement”. She also gave evidence she had:

listened carefully to the submissions made by all 13 women who spoke at the hearing. I have also read the documents which were tendered to the Court during the course of the hearing. The submissions made by women who appeared at the hearing involved medical histories and personal experiences that were (and are) harrowing to hear. They are consistent with the medical histories and personal experiences of other women who are Group Members in this proceeding and group members in the Ethicon and Astora proceedings. For over 7 years I have been listening to group members across each of the pelvic mesh cases in which Shine is retained and in each of those proceedings I have had lead applicants and many women describe to me their personal circumstances.

The personal experiences of the women I have been dealing with in connection with this proceeding in particular were carefully taken into account by me, including by reference to my conversations with Group Members, my review of correspondence with Group Members and records such as medical and financial information, at the time that I was determining an appropriate range within which a settlement of this proceeding ought to be agreed, subject to the Court’s approval.

99    Ms Jancauskas gave evidence as follows:

Since the proposed settlement was announced on 13 July 2022, Shine has received approximately 81 emails from individuals expressing appreciation for the resolution of this proceeding and support for the proposed settlement. Of these individuals, 33 have been confirmed as Group Members. The correspondence received from these 33 Group Members is annexed hereto at Confidential Annexure RJ-7.

(Emphasis added).

100    If one goes to Annexure RJ-7 of Ms Jancauskas’ affidavit affirmed on 26 October 2022 (which is not confidential), this evidence significantly overstates the nature of communications from group members generally, and also raises concerns about the content of communications with group members.

101    First, many of the email communications relied upon were made in response to a group email from Shine; the email was described as an “Important Update”, it gave the headline figure of settlement and correctly noted the settlement was costs inclusive and without admissions. The email from the solicitors (described as “your legal team”) was sent in advance of the Court approved notice, noted the Court would only approve the settlement if it was fair and reasonable, and finally observed that Shine considered “it a privilege to help you pursue your rights, and to ensure that each woman obtains the best possible outcome” (emphasis added).

102    Several things should be said about this communication. Fundamental to the notification regime provided for in Pt IVA of the FCA Act, and in furtherance of the protective and supervisory role the Court has in relation to group members, is the Court exercising control over the content of communications to group members in relation to any proposed settlement. It is necessary that the Court is satisfied group members are apprised of accurate and sufficiently complete information as to the proposed settlement and what the proposed settlement means to the group members. I have previously remarked that the notification obligation causes significant challenges for the Court. Notices in most large-scale consumer or mass tort class actions will be sent to people who have quite different levels of financial and legal sophistication. The ability of group members to understand and evaluate complex information will greatly differ. Many group members would not be in a position to understand the counterfactuals to settlement approval, or recognise potential conflicts of interest and conflicts of interest and duty.

103    If I had been presented with a notice which would have communicated to group members that the settlement would reflect a “best possible outcome”, I would have peremptorily rejected it. The settlement, as Ms Fowkes frankly acknowledges, amounts to a significant compromise. To tell people that the solicitors are ensuring the “best possible outcome” (by seeking approval of the settlement) is simply wrong. It is precisely to sort of comment (from “your legal team”) that would reassure a group member, perhaps unused to dealing with solicitors, that the solicitors are acting to maximise any recovery by the group member.

104    I am confident this communication was not deliberately misleading, but it does show the need for the Court to exercise close control and supervision over such communications. If the content of the communication had been drawn to my attention at the time of sanctioning the Court notice, I would have expressed the Court approved notice in different terms.

105    Additionally, the proposed communication does not convey to the group member any details as to the nature of the compromise, the extent of past and future costs, or any rough estimates of the amount actually payable to group members for compensation generally, or to various bands of group members.

106    Secondly, if one goes through each of the responses to Shine in Annexure RJ-7, the proposition that they constitute some wellspring of informed support for the settlement is unmaintainable. A number are congratulatory or show appreciation for the work of the solicitors; and many (including responses sent to inform the group member the application was part heard) simply respond politely by saying, in terms, “thank you”; or express appreciation of the fact of a proposed settlement in the most general of terms; or express a desire to hear further information from Shine; or give updated contact details; or express appreciation for the communication. One remarks the news is great, but says, “I look forward to hearing what the court thinks of the offer”. None show any appreciation of what the settlement is likely to mean in terms of their own personal circumstances.

107    There is an internal email communication from a member of the “Shine New Client Team” recording oral representations although there is no evidence of what was said to the group member. Further, there is an email dated 12 October 2022 which notes:

Hi

Thank you for what you are doing for the women who have suffered because of the Boston Scientific prolapse mesh implant including myself. We trust these people because they are ‘scientists’ just as we trust our doctors and gynaecologists. I never even asked my gynaecologist what the side effects might be. In hind sight I wish I had asked more questions and had been less trusting. Now I have both rectal as well as urinary incontinence. It's gotten worse requiring me to wear pads for protection. It is embarrassing and undignified and I stand in solidarity with all the other women who have registered for this class action, especially Debra Fowkes who I think is very courageous. I'm so glad I joined and want to thank you once again for taking on this case. May God bless you all.

Kind Regards

108    There is no evidence as to what prompted this email and what was said to this group member in relation to the settlement.

109    Further, and more importantly, just because women did not send emails and did not attend Court to be heard is an unsafe basis upon which to conclude that they support the settlement. As a judge as experienced in class actions as Murphy J explained in Kelly v Willmott Forests Ltd (in liquidation) (No 4) [2016] FCA 323; (2016) 335 ALR 439 (at 453–454 [55]–[61]):

[55]    In light of the objections the settlement parties argued that:

[56]    In my view there is little force in these contentions. First, except perhaps in relation to sophisticated class members, I do not consider the class members’ silence should be taken to indicate their approval or indicate the fairness of a settlement.

…

[58]    As Professor Morabito has said, “the practical realities of class actions have led a number of [US] Courts to conclude that minimal objection to the proposed settlement may not necessarily be equated to approval of the settlement by the class”: Morabito V, “Judicial Responses to Class Action Settlements that Provide No Benefits to Some Class Members” (2006) 32 Monash University Law Review 75, 88-89. I note also that the respected empirical legal researchers Geoffrey Miller and Theodore Eisenberg concluded that:

… notwithstanding frequent statements in judicial decisions to the contrary, the level of dissent is at best weak evidence of the fairness, adequacy, and reasonableness of class action settlements.

(Eisenberg T and Miller G, “The Role of Opt-Outs in Class Action Litigation: Theoretical and Empirical Issues” (2004) 57 Vanderbilt Law Review 1529, 1538.) In my view it cannot be said that there is any necessary correlation between a low level of objections and the fairness or reasonableness of a settlement.

…

[61]    Care must be taken in approaching settlement approval on the basis that the silence of class members is equivalent to their assent. It is the Court’s responsibility to protect class members’ interests and the absence of objections (or a low level of objections) does not relieve it of the task: P Dawson Nominees Pty Ltd v Brookfield Multiplex Limited (No 4) [2010] FCA 1029 (“Brookfield Multiplex No 4”) at [23] (Finkelstein J).     

110    My experience mirrors that of Justice Murphy. A former Lord Chancellor, St Thomas More, for profound reasons, may have embraced the notion qui tacet consentire videtur (silence equals consent) in a different context, but it has limitations in ascertaining the intentions of group members in a mass tort class action.

111    There will no doubt be a number of people who are supportive of the settlement. Indeed, it is possible that a number of the people who sent emails to the solicitors, upon having a better idea of what it means to them in concrete terms, would support the settlement. But on the current evidence, I am not satisfied that the individuals who provided the responses, upon becoming aware of what it means to them in concrete terms, would necessarily support settlement.

112    Taking the evidence as a whole, it is open to conclude, and I find, that this is a settlement that has significant opposition from a not insignificant number of group members, who have real concerns as to its adequacy.

F    SUBMISSIONS IN SUPPORT OF THE SETTLEMENT

113    Experienced counsel appeared on the application instructed by experienced solicitors. There is no reason to suspect that those acting have not attempted to discharge their duties conscientiously and I accept that they have genuinely reached the view that the settlement embodied in the Amended Deed is fair, reasonable and in the interests of group members. The reasons why can be summarised as follows.

114    Settlement discussions were facilitated by a highly experienced Canadian attorney specialising in mass tort and class action cases, Mr Charles Wright of Siskinds Lawyers. Mr Wright has been involved in a number of Canadian cases concerning pelvic mesh implants and has been involved in other settlements with Boston.

115    Boston apparently made plain its requirements (hardly unusual for a respondent in a case such as the present) that any settlement had to provide maximum certainty and finality for Boston and, to this end, any settlement had to settle claims from women who had received an implant, whether or not they had suffered a complication. Further, the basis for settlement negotiations was to be a set of detailed calculations, prepared by Shine and reviewed by Boston, estimating the likely loss or damage that would be sought by a sizeable sample set of group members.

116    Shine already acted for a significant number of women who were thought to have claims against Boston. This was because, in the course of acting for women in the Gill Proceeding, the solicitors had been contacted and engaged by women who, it transpired, had received one of the Boston implants. To ensure a sample set would be statistically significant relative to the anticipated total number of group members, a biostatistician was retained to identify the women who were to be included in the sample group of assessments to be provided to Boston. The biostatistician selected an initial sample group of 154 women and the solicitors obtained their medical and financial records. Assessments of the value of those 154 claims were undertaken.

117    Following this work, a joint opt out and registration process occurred and the parties discovered that the number of group members would be greater than they had appreciated, likely in excess of 2,000 women. As noted above, ultimately, 2,441 women became registrants. Boston apparently considered the initial sample would not be representative of the registrants. In part, this reflected a perceived concern that the initial sample group was skewed toward higher value claims because it had been drawn from women who had signed up to participate in this proceeding prior to opt out and registration. Shine accepted there was some bias in the initial sample, and this was confirmed by the biostatistician.

118    Additionally, apparently Boston desired to negotiate on the basis of an assumption that group members would fall within agreed damages bands, which were to be determined by reference to the number of revisions (that is, surgical interventions) experienced. These bands would be allocated a damages value, which in turn would be used to extrapolate an estimate of the total value of claims. The solicitors worked with senior counsel both to settle upon the criteria for the various damages bands (which were subsequently agreed with Boston) and to provide advice generally on the assessment and estimation process.

119    Ultimately, assessments were undertaken utilising medical and financial records as well as information obtained through interview, of 393 group members (Final Sample Set). These assessments of the value of the claims of the Final Sample Set were undertaken by reference to the applicable personal injury compensation regime and damages values were attributed to the damages bands. The remaining registrants’ claims (that is, the claims of approximately 2,000 further registrants) were then allocated to the bands having regard to self-reported data and on the agreed assumption that they would produce damages results roughly proportionate to the Final Sample Set. This enabled the solicitors to calculate an estimate of the total value of the registrants’ claims of $211,157,200 (excluding interest) (Preliminary Estimate).

120    This estimate was then further adjusted to $170,562,419.80 (excluding interest) taking into account: (a) the generally higher, but varied, value to be attributed in an award in negligence for non-economic loss would apply only to relatively complex claims; (b) not all women, even with complex cases, will have suffered economic loss or have cost of care claims; and (c) the bias which was perceived to remain embedded within the Final Sample Set toward women with higher value claims.

121    It is important to set out the estimates arrived at for the benefit of group members:

122    For completeness, the bands are as follows:

123    I stress here that the bands were, of course, used only in arriving at the settlement figure; they do not reflect the way settlement funds will be distributed if the settlement is approved under s 33V(1) and the Court proceeds to consider issues arising under s 33V(2).

124    This adjusted estimate of $170,562,419.80 became the starting point from which a settlement amount was negotiated. A further two discounts were applied representing general and more specific litigation risks, including as to liability generally and the uncertainty surrounding individual causation, limitations issues, and the vagaries of self-reported data. Taking into account these adjustments and discounts, and allowing an amount toward costs, Ms Fowkes agreed to a settlement on the basis that Boston would pay $105,000,000, inclusive of costs of this proceeding and a proportion of the estimated costs of administering payments from the Settlement Fund.

125    The evidence is that the experienced solicitor for Ms Fowkes was satisfied that no further funds would be forthcoming from Boston and the negotiation process, so far as agreeing on a settlement sum was concerned, was exhausted.

126    As is evident from the above, the pool of group members is far broader than the pool of registrants. It will be recalled that group members are all women who received an implant from a treating hospital or surgeon in Australia prior to the cut-off date (excluding, of course, women who have opted out). Despite this, it is said that this fact does not create an insuperable difficulty because of three matters:

(1)    first, the broad ranging subpoena process which I put in place whereby subpoenas were issued to over 100 private health funds and public health services to obtain the names and contact details of patients who received particular implants or underwent particular procedures for the purpose of sending them opt out and registration notices and registration forms. The women identified through the subpoena process were provided with direct notice in addition to public notices having been published. It is submitted that there is limited risk that there are significant numbers of women who have not registered to participate;

(2)    secondly, it is said it is highly unlikely that women who have received an implant, and especially women who have suffered a complication, are unaware of the pelvic mesh class actions; and

(3)    thirdly, it is said only 35 women have registered (with 26 of them having been confirmed as being group members) since the recent publication of the General Notice.

127    In short, it is submitted that the estimates and adjustments were made by highly experienced professionals and ought to be accepted as fair and reasonable. Further, the quantum of the proposed adjustments and discounts is defensible.

G    THE FAIRNESS AND REASONABLENESS OF THE PROPOSED SETTLEMENT

128    I have already set out the common factors to be taken into account in a settlement approval.

129    I propose to structure this section of my reasons by drawing attention to several factors I consider matter. In so doing, I will consider Ms Fowkes’ submissions and the confidential opinion of counsel, while also identifying which of any additional matters referred to in the Class Actions Practice Note I consider relevant.

130    As will be seen, a number of the factors taken into account are overlapping; the discrete headings used throughout this section serve as no more than a guide.

G.1    Obviously Unreasonable and Unfair Features of the Proposed Settlement

131    In line with the approach to s 33V articulated by Jessup J in Darwalla (at 335 [39]), it is important at the outset to identify any features of a settlement that are obviously unreasonable and unfair. So much was done on the first day of the hearing, resulting in the execution of the Amended Deed, as explained above at [24].

132    The Amended Deed is considerably fairer as between the parties and for group members as a whole than the deed initially proposed. For reasons expanded upon in Section G.3 below, and as illuminated by countless of the objections received, a significant aspect of this case is the desire of group members to be heard and to advocate. The removal of the broad releases and “gag” provisions brings the settlement proposal closer to realising this aspiration.

G.2    The Adequacy of the Settlement Sum

133    The settlement sum is defined to mean:

the sum of AUD$105,000,000.00, being a sum inclusive of all damages, special damages, interest, costs, counsel fees and disbursements, Recovery Amounts and Administration Costs and any GST applicable to those aforementioned costs or amounts. No portion of the Settlement Sum is payment for punitive or exemplary damages.

134    The effect of the settlement is that from the sum of $105,000,000 (supplemented by accrued interest, which was, as at 1 December 2022, in the order of $863,096.78), there will be deductions of:

(1)    all costs incurred to date (estimated as being $7,000,113.94);

(2)    recovery amounts owed to third-party payers (estimated at $9,438,807.58);

(3)    a payout of $20,000 to Ms Fowkes; and

(4)    the costs of the settlement administration (on Shine’s current estimate, should Shine conduct the administration, as much as $16,370,750).

135    If the payout Shine seeks for costs incurred to date and costs of the settlement administration is deemed to be just, the estimated total amount available for distribution to participating group members is $73,033,425.26. I cite this figure for the purposes of providing an arithmetic indication only; obviously enough, more will be available if Shine’s costs are not approved in full and/or a more cost-effective settlement scheme is approved by the Court.

136    Leaving to one side the question of distributions from the settlement fund, I am satisfied that the settlement falls within the range of reasonable outcomes on the following bases.

G.2.1    Prospects and Comparison with Best Recovery

137    Most importantly, as to prospects, given the result in the Gill Proceeding, it might be thought superficially that establishing liability in this case would be straightforward. But to proceed on this assumption would be a mistake. In this regard, while the findings in the Gill Proceeding are particularly strong in relation to mesh implants used for the treatment of POP, the findings concerning mesh implants when used for the treatment for SUI were quite specific to Ethicon both for the Product Liability and Negligence Claims. Much turned on consideration of the particular warnings and information provided by Ethicon with those devices. Much also turned upon what Ethicon knew, and had always known, about the risks attached to its implants. Curiously, given the significant costs already expended, no evidence has yet been gathered as to the warnings and information provided by Boston relative to what Boston did in fact know, or could, and should, have known, in relation to complications. Boston maintains its warnings were satisfactory and insufficient work has been done to reach a definitive view as to whether Boston is correct in that assertion, particularly in relation to the later years in the relevant period when the SUI implants were provided with amended warnings.

138    Further, it cannot necessarily be assumed that a “no transaction” judgment can be obtained against Boston in relation to the SUI implants. Absent a no-transaction finding against Boston, each SUI implant claimant would need to demonstrate that the warning given at the time of implant was inadequate and, further, that if she had been given an appropriate warning, she would not have agreed to receive the SUI implant. This is in circumstances were almost all of the SUI implants remain on the market in Australia (with amended warnings). This is a material difference between this case and the Gill Proceeding. Further, there is a need to be cognisant of the usual practical hurdles to proving personal injury damages, including the collation of medical and financial records, expert reports from medical professionals and allied health workers, and the emotional toll on women. The risk of group member fatigue in and of itself would warrant a not insignificant discount to the ultimate value of group members’ claims if an early settlement is obtainable.

139    Further, the settlement sum must be assessed in the light of the amount of damages that a Court would be able to award group members in respect of various heads of damage if the matter proceeds to trial.

140    As Katzmann J observed in Gill (No 5) (at [4865]), one of the many complexities of a case such as this is the fact that damages must therefore be assessed having regard to statutory schemes that vary from jurisdiction to jurisdiction.

141    The following summary of the relevant legislative regimes is intended to provide guidance to group members on the “best case” litigation counterfactual.

142    As explained in my opening remarks, claims are brought by Ms Fowkes on her own behalf and on behalf of group members for: (1) compensation or damages under the Competition and Consumer Act (or Trade Practices Act, as the case may be) in relation to allegations that the implants are defective products and, or, not of merchantable or acceptable quality (Product Liability Claims); and (2) damages at common law in relation to claims that Boston was negligent in its pre-market, and/or post-market evaluations of the implants and, or, by reason of its failure adequately to warn of the risk of complications associated with the implants (Negligence Claims).

143    In the case of the Product Liability Claims, for ease of reference, I will refer only to the provisions engaged under the Competition and Consumer Act, noting that the provisions engaged by this litigation are not materially different whether it is the predecessor Act (the Trade Practices Act) or the Competition and Consumer Act which applies. The relevant provisions are contained in Pt VIB of the Competition and Consumer Act.

144    As to the Negligence Claims, the applicable limits are set out in the various State and Territory Acts – there is no uniform national regime: Gill (No 5) (at [4889] per Katzmann J).

145    Whether under Commonwealth or State and Territory based legislation, limits apply to both non-economic and economic loss awards.

Non-economic Loss: Product Liability Claims

146    A Court must not award as personal injury damages for non-economic loss an amount that exceeds the amount permitted under Pt VIB of the Competition and Consumer Act: s 87L of the Competition and Consumer Act. As at September 2022, the maximum amount that can be awarded for non-economic loss is $396,800, as mandated by s 87M.

147    Whether an award for non-economic loss is available, and, if so, the value of the non-economic loss claim, are determined by reference to the concept of a “most extreme case”. The statute defines this as a case in which the plaintiff suffers non-economic loss of the gravest conceivable kind: s 87P(2) of the Competition and Consumer Act. The maximum available amount of damages for non-economic loss is only available in a most extreme case: s 87P(1) of the Competition and Consumer Act.

148    For all other cases, the approach taken is as follows.

149    Where the non-economic loss suffered is less than 15% of a most extreme case, the Court must not award personal injury damages for non-economic loss: s 87S of the Competition and Consumer Act.

150    For cases where the non-economic loss the plaintiff suffers is at least 15%, but less than 33% of a most extreme case, the Court must not award more than the amount which exceeds that permitted in the following table:

151    If the non-economic loss the plaintiff suffers is at least 33%, but less than 100% of a most extreme case, the Court must not award an amount that exceeds the applicable percentage of the maximum amount of damages for non-economic loss: s 87Q of the Competition and Consumer Act.

152    Section 87ZA mandates that interest must not be awarded on non-economic loss damages.

Non-economic Loss: Negligence

153    The law which applies as to the amounts which may be awarded for non-economic loss is determined by reference to the law of the place where the wrong occurred: John Pfeiffer Pty Ltd v Rogerson [2000] HCA 36; (2000) 203 CLR 503 (at 544 [100] per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ).

154    The limits on general damages and non-economic loss awards which may be made are subject to exclusions and caps but will generally be higher than the awards available under the Competition and Consumer Act. There is an arbitrariness in this sense, as the applicable cap depends on where a group member had their surgery. The caps and limits which apply are set out in Annexure A to these reasons.

Economic Loss

155    Limits on economic loss awards apply whether under the Commonwealth or State and Territory regimes.

156    Section 87U of the Competition and Consumer Act requires that, when determining personal injury damages for economic loss under that Act, the Court must disregard the amount by which the plaintiff’s gross weekly earnings during any quarter would (but for the personal injury or death in question) have exceeded: (1) if, at the time the award was made, the amount of average weekly earnings for the quarter was ascertainable—an amount that is twice the amount of average weekly earnings for the quarter; or (2) if: (a) at the time the award was made, the amount of average weekly earnings for the quarter was not ascertainable; or (b) the award was made during, or before the start of, the quarter; an amount that is twice the amount of average weekly earnings for the quarter that, at the time the award was made, was the most recent quarter for which the amount of average weekly earnings was ascertainable.

157    Average weekly earnings is defined in s 87V of the Competition and Consumer Act. Currently, twice the average weekly earnings as defined is $2,689.40.

158    As to negligence claims, the position is that once economic loss is ascertained, a discount is then applied to take account of the uncertainties which attend the hypothetical situation in which a group member would have earned income during the relevant period in time such that a notional economic loss figure is ascertained. Caps are then applied. As at the date of the hearing, the caps were as follows:

(1)    Australian Capital Territory: s 98 of the Civil Law (Wrongs) Act 2002 (ACT) requires the Court to disregard loss of earnings above a limit of three times average weekly earnings in a week (as defined in s 98). Currently, three times the average weekly earnings as defined is $6,298.80;

(2)    New South Wales: s 12 of the Civil Liability Act 2002 (NSW) requires the Court to disregard the amount (if any) by which the claimant’s gross weekly earnings would (but for the injury or death) have exceeded an amount that is three times the amount of average weekly earnings at the date of the award (as defined in s 12(3)). Currently, three times the average weekly earnings as defined is $5,370.00;

(3)    Northern Territory: s 20 of the Personal Injuries (Liabilities and Damages) Act 2003 (NT) requires the Court to disregard the amount (if any) by which the injured person’s gross weekly earnings would, but for the personal injury, have exceeded an amount that is three times average weekly earnings as published before 1 January preceding the date on which the assessment is made (as defined by s 18 of the Act). Currently, three times the average weekly earnings as defined is $5,130.90;

(4)    Queensland: pursuant to s 54 of the Civil Liability Act 2003 (Qld), in making an award of damages for loss of earnings, including in a dependency claim, the maximum award a Court may make is for an amount equal to the present value of three times average weekly earnings for each week of the period of loss of earnings (as defined in Schedule 2 to the Act). Currently, three times the average weekly earnings as defined is $5,115.30;

(5)    South Australia: s 54 of the Civil Liability Act 1936 (SA) provides that the total damages for loss of earning capacity (excluding interest awarded on damages for any past loss) are not to exceed the prescribed maximum. Currently, the prescribed maximum is $3,540,070.00;

(6)    Tasmania: s 25 of the Civil Liability Act 2002 (Tas) prescribes caps on economic loss in relation to lost superannuation by reference to the maximum percentage required by law to be paid as superannuation contribution. Section 26 of that Act provides that the Court must not award damages for loss of earning capacity on the basis the person was, or may have been capable of, earning income at greater than three times the adult average weekly earnings as last published by the Australian Bureau of Statistics before damages are awarded (as defined in s 3 of the Act). Currently, three times the average weekly earnings as defined is $5,309.40;

(7)    Victoria: s 28F of the Wrongs Act 1958 (Vic) provides that the maximum amount of damages that may be awarded for each week of the period of loss of earnings is an amount that is three times the amount of average weekly earnings at the date of the award (as defined in s 28F(3)). Currently, three times the average weekly earnings as defined is $5,252.10; and

(8)    Western Australia: s 11 of the Civil Liability Act 2002 (WA) provides that in assessing damages for loss of earnings, the Court is to disregard earnings lost to the extent that they would have accrued at a rate of more than three times the average weekly earnings at the date of the award (as defined in s 11(3) of the Act). Currently, three times the average weekly earnings as defined is $5,811.90.

Consideration

159    It is not possible to say with any precision what group members might recover if the matter continues to be litigated. What is apparent from the objections received by the Court, however, is that group members have expressed a desire to have compensated losses that would not be recoverable through any Court process, even on a “best case” scenario.

160    For example, group members described to the Court the loss or diminution in income of businesses they owned prior to their implant surgery. The ability of the Court to compensate such group members, whether for their Product Liability or Negligence Claims, is limited. In a similar vein, lost or damaged relationships, although often tragic events, are not, in and of themselves, a species of loss recognised by the law in this area.

161    But even a detailed survey of the best case scenario in hypothetical terms can be insufficient in a case such as this. It can help, however, to narrow down swathes of evidence into a set of key integers. Accordingly, I requested Ms Fowkes’ solicitors provide the Court with a schedule setting out the estimated amounts to be paid pursuant to the settlement to four identified group members and compare it to the best case recovery the group member would receive if their claim was litigated to a conclusion and damages or statutory compensation was awarded together with interest.

162    Obviously, a number of caveats attach to the evidence ultimately produced. First, Ms Fowkes came to these figures applying the “points system” outlined in Shine’s proposed settlement scheme, which, given the deferral of consideration of the scheme until after approval of the headline sum, is by no means the system that will be applied to determine the amounts recoverable by group members if settlement is approved. Secondly, Ms Fowkes’ solicitors did not have access to all evidence, as would ordinarily be the case, in undertaking a damages assessment, but relied on statements advanced verbally and in writing by group members and medical records.

163    Notwithstanding these qualifications, the figures provided allowed me to conclude that the settlement sum, when compared with the best recovery available, was within the range of fair and reasonable outcomes. The figures arrived at under the settlement scheme (before settlement discounts were applied) were in the order of what would be available before a Court.

164    I was also assisted by a “comparator claim assessment” provided by the solicitors for Ms Fowkes, which involved estimating the amount that would be recovered by the three lead applicants in the Gill Proceeding if they were group members in this proceeding, and settlement was approved, as compared with what the three lead applicants received as a result of the Gill litigation. A further and significant caveat applies to this evidence, namely that the Gill Proceeding concerned different parties, different implants and an entirely different case. But, with all of this in mind, it was nonetheless compelling to situate the proposed settlement in the real world. The figures under the settlement scheme were also referrable to what the lead applicants obtained by seeing the litigation through to its end.

G.2.2    The Development of Damages Bands

165    For the following reasons, I am satisfied that the development of damages bands was a rational approach to ensure that the settlement sum reflects the contours of the group membership.

166    Plainly, the use of damages bands cannot provide more than a rough estimate of the potential total value of group member claims. There are numerous uncertainties built into any such estimate: the data relied upon is largely self-reported; it is not submitted that the Final Sample Group can be treated as statistically significant, at a level that a biostatistician might expect, for the whole of the group member cohort; and such assessments as have occurred are, as is inevitably the case, subject to the proviso that reasonable minds may differ in the course of undertaking the evaluative exercise of arriving at a damages estimate.

167    But it is hard to be determinative about many things in a settlement approval application such as this one. It is evident that the stratification of group member claims into damages band was the fairest way of regularising what information is available, and ensuring the estimates arrived at are fair as between group members. This is achieved in that the damages bands reflect, to the extent possible, the way the Court would stratify claims should the matter proceed to individual assessments following a successful outcome on liability.

168    Finally, the damages bands were developed in consultation with experienced senior counsel, and by solicitors with demonstrated track records in estimating the value of claims in other pelvic mesh actions and other personal injury and product liability actions. The significance of this should not be understated, and is identified as a relevant consideration in the Class Actions Practice Note.

G.2.3    Reasonableness of Adjustments and Discounts Applied

169    The adjustments and discounts applied can be dealt with in two parts: first, the adjustments applied to ensure the estimated total value of registrant claims was not skewed toward higher value claims; and secondly, the litigation risk discounts applied.

170    As to the first, the adjustment applied to the Preliminary Estimate was sizeable. I was, at first, concerned by the jump from $211,157,200 to $170,562,419.80, particularly given the revelation during the course of oral submissions that the Preliminary Estimate did not account for interest (discussed below in G.2.6).

171    However, in view of the biostatician’s report and the opinion of counsel, it is evident that the Preliminary Estimate tended in favour of women with higher value claims, who were more likely to engage Shine early in the proceeding, prior to the Court-ordered registration process. In a similar vein, adjustment was required to account for the fact that only a subset of complex claims would give rise to substantial awards in negligence for non-economic loss and awards for economic loss or cost of care.

172    I accept that adjusting for the likelihood and value of awards that may be made, particularly for non-economic loss and care claims, is not a science. Especial caution must be exercised in a case such as this one where no liability findings have been made, and where there has not been an extensive reference process. In all the circumstances, the terms of the advice received by counsel and the independent experts engaged demonstrate that the adjustment was well informed. I reiterate here that it is important the Court does not assume it in is in a better position than the legal representatives to appreciate the nature of the class.

173    Secondly, the litigation risk discounts applied, while also substantial, are within reasonable bounds.

174    In their confidential opinion, counsel disagreed with Ms Fowkes on the path taken to arriving at the discount (in particular, as to the application of limitation periods and the likelihood that group members will establish causation of harm). They did, however, agree that a discount in the order of that applied was appropriate.

175    The amount arrived at reflects that settlement is by nature a compromise. It is reasonable to apply a real discount to account for the practical difficulties of establishing liability, and what counsel for Ms Fowkes was keen to describe as the risk of “group member fatigue”.

176    It should be said that Ms Fowkes overstated this point. There is no doubt that a liability determination may carry with it a heavy emotional price for group members. Of course, a woman who prosecutes her case, traversing matters highly sensitive and personal to her, against a well-resourced respondent, will face challenges. But I am not convinced that it poses, as counsel for Ms Fowkes put it, a “real impediment to obtaining compensation”.

G.2.4    Comparison with Gill v Ethicon

177    In amplification of the general point made above, four observations may be made as to the comparisons drawn between this proceeding and the liability findings in relation to the Gill Proceeding.

178    First, there are inherent difficulties in translating the liability findings in the Gill Proceeding to this context. While the Court’s findings in relation to mesh implants used for the treatment of POP have obvious and significant import, the findings concerning mesh implants used for the treatment of SUI were largely case-specific, and provide little certainty as to the outcome obtainable in this proceeding. I am fortified in this view by the fact that almost 62% of registrants in this proceeding received a single SUI Implant.

179    More generally, as noted above, there is little evidence now as to the particular warnings and information provided by Boston relative to what Boston did in fact know, or could, and should, have known, in relation to complications.

180    Secondly, and also as noted above, Ms Fowkes is right to distinguish this case from the Gill Proceeding on the basis that it cannot be assumed that a “no transaction” judgment can be obtained against Boston in relation to the SUI implants. On appeal, the Full Court emphasised (at 539 [888] per Jagot, Murphy and Lee JJ) that absent a no-transaction finding, each SUI implant claimant would need to demonstrate that the warning given at the time of implant was inadequate and further that if she had been given an appropriate warning, she would not have agreed to receive the SUI Implant. Obvious forensic difficulties would attend such a task.

181    Thirdly, there are nonetheless findings of general import which suggest Ms Fowkes may be likely to succeed in her action. In Gill (No 5), Katzmann J found that available studies considering pelvic mesh implants from a number of manufacturers support a conclusion that the following complications are common after surgery with mesh implants used to treat SUI (at [1139]):

(1)    mesh exposure/extrusion/erosion;

(2)    recurrent urinary tract infections;

(3)    chronic pain;

(4)    dyspareunia;

(5)    difficulty voiding;

(6)    de novo urinary incontinence;

(7)    recurrence of SUI;

(8)    bladder perforations (with retropubic slings) (uncommon but not rare with transobturator slings); and

(9)    reoperation or revision surgery associated with complications.

182    Further, after surgery with pelvic mesh devices used to treat POP, those complication rates are higher (Gill (No 5) at [1140])), and mesh erosion (encompassing erosion, exposure and extrusion) has been very common with transvaginal implantation and common after abdominal placement: Gill (No 5) (at [1141]).

183    Fourthly, and most importantly, caution should be exercised when comparing the litigation counterfactual in this case to the realities of the Gill litigation. At a number of points in oral and written submissions, consideration of the counterfactual to settlement was reduced to a binary between settlement as currently proposed and the Gill Proceeding, which might be described as the litigation equivalent of the Battle of the Somme. The trial commenced at the beginning of July 2017 and did not conclude until the end of February 2018, involving evidence from 48 witnesses, 35 of whom gave evidence viva voce, and more than 5,500 documents were tendered, running to over 164,000 pages: Gill (No 5) (at [19]–[20] per Katzmann J).

184    There should not be an assumption that any initial trial in this proceeding would be conducted in the same way. For my part, if settlement is not approved and the proceeding remains in my docket, my intention would be to make orders providing for an inquiry and report by a referee on the questions of liability, to be the subject of an adoption hearing, followed, if necessary, by a reference process to determine individual claims.

G.2.5    The Requirement to Pay Recovery Amounts

185    Third party payers have, of course, a statutory right to recover amounts from the compensation payable to Participating Group Members. It is a normal incident of a settlement scheme in mass tort and product liability class actions involving personal injuries for consideration to be given to the reimbursement obligations of group members under statute and contract: see Matthews v AusNet Electricity Services Pty Ltd [Ruling No 40] [2015] VSC 131 (at [19]); R Gilsenan and M Legg, ‘Australian Class Action Settlement Distribution Scheme Design – Deciding Who Gets What’ (2019) 38(1) University of Queensland Law Journal 15 (at 23); IMF Bentham Report (at 18).

186    That statutory right is supported by the imposition of penalties on a “compensation payer” who fails to attend to reimbursement of such payments prior to paying a claimant. Boston and the solicitors for Ms Fowkes appear to have operated under the assumption that Boston is the “compensation payer” who would be liable to a penalty in the event that payments are made to Participating Group Members prior to third party payers being reimbursed. I do not think this construction of the legislation is correct but, in any event, reimbursement of any valid claims of third party payers ought to be attended to as a priority by an administrator in a settlement of a class action involving personal injury claims.

187    Accordingly, the requirement to pay recovery amounts neither tends towards nor militates against the conclusion that the proposed settlement is fair and reasonable inter partes or inter se.

G.2.6    Interest

188    For completeness, I should say something as to interest.

189    Following questioning it emerged that interest had not been included in the Preliminary Estimate used in settlement negotiations. The Preliminary Estimate was determined giving group members the benefit of assumptions as to non-economic loss calculations that would apply under State and Territory based legislation applicable to claims in negligence. Those advising Ms Fowkes formed a view that the prohibitions on the payment of interest under the relevant State and Territory civil liability provisions were picked up under s 79 of the Judiciary Act 1903 (Cth). I queried whether this was a correct application of s 79.

190    There is no need to examine this technical point further. What matters for present purposes is whether the settlement figure was in the range of reasonable outcomes.

191    To obtain clarity on the point, I requested further submissions on the quantum of interest that may apply to group member claims if they were to proceed to judgment on “best case” scenarios. Ms Fowkes calculated an estimate of interest assuming that the Preliminary Estimate was to be adjusted having regard to applicable interest rates for awards of damages in negligence. This means that in respect of group members who suffered damage in States or Territories in which the applicable civil liability legislative regime does not alter the law with respect to interest on awards of damages, s 51A of the FCA Act was applied (see Gill (No. 5) at [5125]). Applying this regime, an interest amount of $7,166,864.34 accrues with respect to these group members (constituting 43% of all group members). As for the remaining 57% of all group members, who suffered damage in other States and Territories, a total amount of interest of $3,884,020.14 accrued. Accordingly, if interest is added to the Preliminary Estimate, the resulting figure is increased by a total of $11,050,884.50, culminating in a total of $222,208,084.48 (a figure to which the adjustments and discounts discussed above would, of course, be applied).

192    This is a substantial amount. However, I do not think the exclusion of “best case” scenario interest from the Preliminary Estimate is fatal to a finding that the settlement sum is fair, reasonable and in the interests of group members. It demonstrates that reasonable minds may differ in conducting protracted analyses based on hypotheticals and limited information. Moreover, any concerns is this regard are allayed to a minor extent by the fact that interest on the settlement sum will be payable to group members, an amount that would not be available if settlement is not approved.

G.3    The Relevance of the Non-Admission

193    I now turn to an important point I have considered, but which militates against the proposed settlement. In many cases, the task of approving a settlement is easy. Although it is now clear that commercial litigation conducted by way of class action is not a managed investment scheme, it is still a joint enterprise focussed on a commercial outcome. Put more bluntly: it is all about money. Provided the monetary return to group members looks fair, it is often an undemanding task to reach the level of satisfaction required by s 33V, notwithstanding the protective nature of the power being exercised. But the present case is about much more than money. To the extent there was any doubt about this proposition, this was established beyond peradventure by the presentations made by group members.

194    This is a case about personal injury and, where complications have manifested, a particular type and intimate form of personal injury. Compensation is, of course, the dominant purpose of civil actions and the purpose of compensatory damages in tort law is to place a plaintiff as far as possible in the position in which they would have been, had the wrong not occurred: Livingstone v Rawyards Coal Co (1880) 5 App Cas 25 (per Lord Blackburn). But it must be recognised that vindication of legal rights is a fundamental purpose of private law and every remedy, including a monetary one, has some form of vindicatory effect: see, for example, J Varuhas, ‘The Concept of ‘Vindication’ in the Law of Torts: Rights, Interests and Damages’ (2014) 34(2) Oxford Journal of Legal Studies 253, 254–93.

195    This settlement involves no vindication of the claims of group members as would be obtained if they received a judgment. It is condition of the settlement generally that there are no admissions by Boston and, indeed the parties go further; first, there is a requirement upon Ms Fowkes to acknowledge expressly the fact that the Boston companies maintain they would be successful if the class action had proceeded to judgment and that Boston would defend any other similar claim: see cl 29(a)(iii); and secondly, the Scheme itself, the terms of which are proposed to be imposed upon Participating Group Members, provides, by way of “Overview and Summary” that:

The proposed settlement and this Settlement Scheme are made with a specific denial of liability and are not to be represented as an admission of liability by the Respondents or any of their related entities.

196    One recurring theme in the material provided by the objectors is the fact that the complaints of group members suffering complications were initially met by scepticism and disbelief. No doubt, in some cases, this meant physical suffering was exacerbated by frustration and anger. To be believed by others is a basic human desire. In recent years there has been some recognition of the fact that a claimant’s need in response to torts and other civil wrongdoing may extend beyond material concerns: R Carroll and N Witzleb, ‘‘It’s not just about the money’—enhancing the vindicatory effect of private law remedies’ (2011) 37(1) Monash University Law Review 216, 216–240.

197    In an article, ‘Apologies as a Legal Remedy’ (2013) 35 Sydney Law Review 317, the author, Ms Robyn Carroll, explained (at 319):

Research has also been conducted in Australia into the role that apologies play in medical negligence cases. Researchers have found that people interviewed about their experience of adverse medical events and who express satisfaction about the disclosure process typically ‘are those whose expectations of a full apology ... and an offer of tangible support were met’ [Rick Iedema et al, ‘Patients’ and Family Members’ Experiences of Open Disclosure Following Adverse Events’ (2008) 20 International Journal for Quality in Health Care 421, 430]. In the light of evidence that apologies can have psychological and, most probably, health benefits, it is no surprise that efforts have been made in recent years within the health and legal professions in Australia and overseas to encourage medical and health care professionals to make disclosure and offer apologies in a timely way following an adverse medical incident.

198    It is well beyond the scope of this judgment to attempt to canvass the medical or psychological literature regarding the importance of acknowledgments of wrongdoing, or the cathartic function of vindication through curial order when a claimant seeks redress for a wrong. These are large topics and although raised by me, were not explored in any depth by the parties. Counsel for Ms Fowkes and the respondents implored me to form a view that the non-admission is irrelevant. In developing this submission, the parties placed emphasis on the comments of Wigney J in Stanford v DePuy, where his Honour considered written and oral objections of group members concerning hip replacement implants (at [80]–[88], [129]–[136] and [159]–[165]). Relevantly, his Honour reflected (at [164]):

a number of the objecting group members were aggrieved by the fact that the settlement was on a “no admissions” basis. They wanted DePuy and Johnson & Johnson Medical to acknowledge and take responsibility for the pain and suffering that they had endured. Such an emotional response was perfectly understandable. It was not, however, a proper or reasonable basis to find that the settlement was not fair and reasonable. Experience suggests that representative proceedings of this type rarely settle on anything other than a no admissions basis. Settlement of proceedings on a no admissions basis is commonplace.

(Emphasis added).

199    I have not, of course, had access to the material before the Court on a different settlement application, and have no reason to doubt, in the circumstances that case, the correctness of a conclusion that the absence of an acknowledgment of responsibility was not a proper or reasonable basis to find that the relevant settlement was not fair and reasonable. But in these sorts of applications, like in other matters of class action practice and procedure, care must be taken to avoid reading judgments on fact specific issues as if they were determinative of precepts and principles of general application: see Regent Holdings Pty Ltd v State of Victoria [2012] VSCA 221; (2012) 36 VR 424 (at 429 [19] per Nettle, Redlich and Osborn JJA); Gill v Ethicon Sàrl (No 2) [2019] FCA 177; (2019) 134 ACSR 649 (at 652 [6] per Lee J).

200    The subjective importance to group members of an absence of an acknowledgment of responsibility in one case (say a money claim) will be very different to a case involving personal injury. Further, it might be quite different depending upon the type of alleged personal injury, including when the injury is perceived to involve damage of an intimate and deeply personal kind and when complaints were, in some cases, initially the subject of scepticism. Further, the fact that no admissions settlements are commonplace does not mean the fact that the deprivation of the opportunity of group members being able to seek a vindication of their claims is irrelevant in the overall reasonableness evaluation.

201    I infer that it is likely that a not insignificant number of group members will have experienced a deep sense of frustration at not being believed or of being “fobbed off” by people not appreciating the extent of their pain. Certainly no evidence was led to suggest that the experience of group members from whom I heard was atypical or somehow unrepresentative of those group members who suffered similar symptoms.

202    The original proposal of a “gag” to be placed on group members (which would have exacerbated this problem), may have disappeared, but in the particular circumstances of this case, preventing group members obtaining public acknowledgment of what they allege is the cause of their suffering, and holding the company they consider responsible for their suffering to account, is no small thing.

203    It is superficial to respond simply by noting that Boston will not acknowledge liability and no settlement can be struck which does not reflect this line in the sand. This position may be accepted. It may also be accepted Boston may well succeed in resisting liability at a contested hearing, but this is not an answer to the point I am making. Some cases, and this is one of them, have an emotional dimension which makes the striking of any settlement absent a recognition of wrongdoing more difficult than others. Some defamation claims, when the perceived need for vindication is often the whole point of litigating, is a paradigm example of such a case.

204    The question for me is not whether this settlement is the best settlement that can be brokered, but a different one: the question is whether it is a settlement that is fair, reasonable and in the interests of group members as a whole. This evaluation necessarily includes a consideration of the litigation counterfactual, including providing group members the opportunity for public vindication and the chance to visit liability upon those they consider responsible. The no-admission is a factor to be taken into account.

G.4    Counterfactual of a Liability Determination and Subsequent Possible References

205    I have already, in Sections G.2.1 and G.2.4, addressed the scenario group members may find themselves in if this matter proceeds to a liability trial. It is necessary to make two further points, directed to the spectre of inter se unfairness raised by the counterfactual of a liability determination and subsequent possible references.

206    First, in Section G.2.1 I explained that if the matter proceeded to trial or an individual reference process, caps on economic loss awards would apply, which differ between the states and territories. An issue of unfairness as between group members could be said to obtain under the settlement given that women who would receive more based on statutory and choice of law rules are treated together with those who would receive less. This concern is somewhat assuaged when, by parity of reasoning, one has regard to the fact that the usual approach in settlement distribution schemes for mass tort and product liability actions has been to adopt a uniform regime: see R Gilsenan and M Legg, Australian Class Action Settlement Distribution Scheme Design (IMF Bentham Class Action Research Initiative Report No 1, 1 June 2017) (at 18).

207    Secondly, obviously enough, if the matter was to proceed to individual determination of group member claims, individual defences may be available to those claims. In this regard, a limitations defence has been foreshowed to some claims. This was raised at the hearing of the application in the course of a discussion of the proposed references. The exchange (T89–90) commenced by me making reference to the fact that if there were references, there would be a process of information sharing with the assistance of counsel assisting, and there may be individual offers made. Group members would then be in a position to either accept or reject offers “tailored to their individual circumstances” when information relevant to their claim had been ascertained. If the offer was accepted, then at least they would be making that choice and doing so conscious an offer has been made which reflects their individual circumstances, but if they rejected the offer, “then they may be at risk of the costs of going further” and seeking an individual determination.

208     The response of counsel was to ask the question:

… who pays for the cost – for example, a group member comes forward and a Limitations Act defence succeeds. Who pays for the cost in that scenario?

209    To which I responded that if there had been a declassing (as one would expect in this scenario), then the usual consequence of rejecting an individual offer and proceeding to run an unsuccessful case, would be that the person making that election would be subject to an adverse costs order.

210    But this exchange raises an important point.

211    As is evident from the decision of the Full Court (Jacobson, Middleton and Gordon JJ) in ASIC v Richards, considering the question as to whether a proposed settlement is fair and reasonable involves more than just considering the overall settlement sum. It requires consideration of the distinct question of whether the distribution of the sum “as between all group members [is] fair and reasonable” (at [40]). This need for fairness and reasonableness inter se is, at least in my experience, often not given sufficient prominence at s 33V hearings.

212    Looked at solely from the perspective of a subset of group members who have a weak claim because there are grounds for thinking their claims have limitations problems not present in other individual cases, a global settlement not distinguishing between the two subclasses might be thought a boon. From the perspective of group members as a whole, it is hardly fair that those group members without limitations difficulties are, in effect, subsidising the recovery from a finite pool of those group members who do or may have difficulties. Again, this is a factor to be taken into account.

G.5    The Attitudes of Group Members Generally

213    I have already outlined at length the views expressed by group members as to the sufficiency of the settlement proposal.