What to watch in 2026

2026 is set to be another significant year for class actions in Australia. Important judgments will clarify key aspects of the law (particularly in relation to shareholder class actions), while new regulatory enforcement priorities and recent and upcoming legislative reforms may materially affect the class action risk environment. We are keeping an especially close eye on the following matters.

• The appeal to the High Court of the decisions in the Zonia and Baron shareholder class action proceedings.¹ The appeals raise important questions for the High Court, including the approach to causation, the proper measure of loss in shareholder class actions and the threshold for establishing disclosure breaches.
• Whether cyber and data breach class actions prove viable. The Optus² and Medibank³ class actions are still on foot, with OAIC civil penalty proceedings and representative complaints progressing in parallel. Judicial guidance remains limited on the nature and extent of recoverable loss, particularly the compensability of non‑economic harm. Greater clarity is expected as these matters progress. This includes whether cyber class actions can succeed in the absence of demonstratable direct financial loss, and the implications for exposure and settlement dynamics.
• Whether US product liability class action trends continue to flow through to Australia. In recent years, we have observed an increase in Australian defective product class actions following the outcomes of US proceedings. If this trend continues we expect it to generate additional filings in 2026, particularly in the healthcare sector.
• Whether heightened regulatory focus on consumer issues, driven by cost-of-living pressures, increases consumer class action filings. Continued ACCC investigations and regulatory reforms may also drive greater competition class action risk, including follow‑on claims arising from regulatory scrutiny, even where no liability findings are made.
• Consultation on draft laws banning unfair trading practices signals a tightening regulatory environment. High-risk areas include subscription traps. If passed, these laws may increase class action exposure for corporates whose consumer practices are scrutinised under the new regime.
• The High Court's decisions in Kain⁴ and Bogan⁵ may renew calls for reform. In those cases, the Court held respectively that the Federal Court does not have power to make solicitors' common funds orders, and that Victorian GCOs cannot travel with a case transferred to another jurisdiction. These outcomes may prompt the Government to revisit the Australian Law Reform Commission’s 2019 recommendation to permit contingency fee arrangements in class actions, consistent with the Victorian GCO regime, and other states to consider adopting a Victorian GCO approach.