Stanford v Depuy International Pty Ltd (No 9)

Stanford v Depuy International Pty Ltd (No 9) [2025] FCA 1676 is a Federal Court decision about the final stage of a court-approved class action settlement scheme. The underlying dispute concerned allegedly defective ASR hip implants, but this judgment was not about liability or whether the implants were defective. It was about how the remaining settlement money should be distributed, whether further administration costs should be paid, what should happen to group members who could not be contacted, and whether sensitive claimant information should remain confidential.

The Court approved final top-up payments to eligible group members, approved further administration costs and disbursements, ordered that 61 uncontactable group members would not receive further distributions unless otherwise ordered, and made confidentiality and non-publication orders over annexures containing names and payment details. The decision is a useful example of how courts supervise the end of a large settlement scheme and what sort of evidence is needed to close one properly.

The representative proceeding was brought by applicants who had ASR implants surgically implanted, both for themselves and for other affected people in Australia. They alleged that DePuy International Limited and Johnson & Johnson Medical Pty Limited had contravened the Trade Practices Act 1974 (Cth) because the implants were not reasonably fit for purpose, were not of merchantable quality, and were not as safe as people generally were entitled to expect. They sought compensation for loss and damage said to have been caused by the manufacture and supply of those implants.

The matter proceeded to trial, but the parties reached a commercial settlement before judgment was delivered. In broad terms, the respondents agreed to pay $250 million plus interest. The Court approved the settlement in 2016 and the money was to be distributed under a detailed settlement scheme. That scheme was designed to operate over several years. Group members had to register claims, the administrators had to assess eligibility, and eligible group members could either accept a lump sum fast track payment or have their compensation individually assessed.

By the time of this application, 1,635 group members had been found eligible for compensation. Of those, 1,339 chose fast track payments and 296 chose individual assessment. The judgment explains that this election pattern mattered. More people than expected chose fast track, and fewer than expected chose individual assessment. Because individually assessed claims had been expected to exceed the lump sum fast track amounts, the settlement fund ended up with a surplus after original compensation amounts were paid in full.

The scheme had already produced a first top-up payment of 17.5% for most group members. The administrator then returned to the Court seeking approval for a final top-up payment, approval of further administration costs, orders dealing with a cohort of uncontactable group members, and confidentiality protection for annexures containing names and payment details. The application was unopposed, but the Court still had to decide whether the proposed orders were available and appropriate.

The Court had to decide four practical questions. First, whether final payments to eligible group members should be approved under the scheme and the Court's powers. Secondly, whether further administration costs and disbursements should be paid from the settlement account. Thirdly, whether the scheme could be finalised on the basis that 61 eligible group members who could not be contacted would not receive any further payment. Fourthly, whether annexures containing names of group members, their compensation election type and payment details should be kept confidential and not published.

The judgment referred to the Federal Court of Australia Act 1976 (Cth), including ss 33V and 33ZF for settlement-related and supervisory orders, and ss 37AF and 37AG for confidentiality and non-publication orders. Even though nobody opposed the application, the Court said it still needed to carefully consider the availability and appropriateness of the orders in all the circumstances.

The Court approved the final payments to eligible group members. The actuaries had first advised that a further payment of 4.68 cents in the dollar would be appropriate. In a supplementary report, updated scheme accounts showed that more money was available for distribution than first estimated. On the revised figures, the Court approved final payments based on 4.82 cents in the dollar. For fast track claimants, that meant an additional $2,651 for single revision claimants and $5,302 for double revision claimants. Individually assessed claimants would receive variable amounts depending on their assessed compensation. The Court accepted the assumptions, methodology and calculations as reasonable.

The Court also accepted that it was reasonable to retain a contingency amount of $100,000. The judgment records that this reserve was intended to respond to possible slips, omissions or errors, including the possibility that an uncontactable group member might come forward before the scheme was wound up, or that final administration expenses might differ from estimates. The Court also noted the administrator's proposal that any monetary balance remaining when the scheme was finalised and effectively wound up would be donated to a suitable charity, and considered that proposal reasonable in the circumstances.

On administration costs, the Court approved payment of $1,115,474 for general administration costs, $120,450 for claims books and $232,695 for disbursements for the period November 2021 to May 2025. The judge noted that earlier decisions had expressed concern about the scale of administration costs over the life of the scheme, but accepted the current costs because they were supported by cogent expert evidence from a legal costs expert whose methodology and reasoning the Court accepted.

On the uncontactable group members, the Court found that the administrator had taken reasonable steps to contact them. Those steps included at least two emails, registered post where appropriate, text messages where mobile numbers were available, and further searches such as probate registers and the Ryerson Index. The scheme also required group members to cooperate and promptly update their contact details. The Court therefore ordered that the identified uncontactable cohort would not be entitled to any further payment or distribution from the settlement account, unless otherwise ordered. That qualification left open the possibility of further directions if someone came forward before the scheme was finally wound up.

Finally, the Court made confidentiality and non-publication orders over two annexures to the administrator's affidavit. Those annexures contained the names of all eligible group members, including the uncontactable cohort, as well as details of whether each person had chosen fast track or assessed compensation and the payments made to date. The Court held that disclosure would be contrary to the interests of justice and would prejudice the administration of justice, given the nature of the proceeding, the settlement scheme and the vulnerability of the group members. The Court did not consider that open justice required publication of that information.

This was a strongly evidence-driven application. The Court did not simply accept that the scheme should end because most people had already been paid. It looked at the settlement scheme itself, the administrator's reports, the supplementary report, actuarial advice from Finity Consulting, and expert evidence from a legal costs expert. That material was used to justify the final payment percentage, the contingency amount, the administration costs and the treatment of uncontactable group members.

The conduct of the administrator also mattered. The Court was satisfied because there was a documented process for contacting group members and because the administrator had taken multiple steps before asking the Court to cut off further distributions to the uncontactable cohort. The judgment also relied on the fact that the scheme imposed obligations on group members to cooperate and to update their contact details promptly. In other words, the final order was not based only on administrative convenience. It was tied back to the scheme rules and the evidence of reasonable efforts.

Most businesses will never run a court-approved class action settlement scheme, but the decision still has practical value. It shows what disciplined administration looks like when money is being distributed to a large group of affected people. The Court focused on process: how payments were calculated, how costs were justified, how recipients were contacted, and how sensitive information was protected. Those same issues often arise in smaller remediation programs, customer refund exercises, warranty programs, product recalls and negotiated settlements.

The case also shows that finalisation is its own stage. It is not enough to say that the main payments have already been made. Someone still needs to reconcile the fund, account for future contingencies, decide what happens if recipients cannot be found, and document why the final approach is fair. If your business is involved in a compensation or remediation exercise, those end-stage issues should be planned early rather than left until the fund is almost exhausted.

There is also a privacy lesson. The Court was willing to make non-publication orders because the annexures contained names, payment details and compensation election information, and because disclosure would prejudice the administration of justice. Businesses should not assume that confidentiality will always be granted, but where information is genuinely sensitive and there is a proper legal basis, privacy protections may be available. The safer course is to build confidentiality controls into the process from the start and limit unnecessary disclosure of claimant information.

Finally, the decision shows the importance of clear rules about leftover funds. Here, the Court accepted a contingency amount of $100,000 and noted the proposal that any remaining balance after finalisation would be donated to a suitable charity. Whether that approach is available in another matter will depend on the governing documents and the legal framework, but the broader lesson is simple: do not leave surplus handling to improvisation.

The judgment was delivered on 19 December 2025 by Wigney J in the Federal Court of Australia. It followed earlier decisions in the same matter concerning settlement approval, administration and costs. This decision sits at the end-stage of the scheme and is best read as a procedural authority on final distributions, administration costs, uncontactable recipients and confidentiality in a court-supervised settlement context.