While stocks of all types, shapes and sizes continue to get hammered week after week, two Australian companies are reporting surging earnings and bright prospects in the current economic crisis.   What industry are these stocks in?  The Australian securities class action industry.

Last week, IMF (Australia) Ltd., the dominant class action litigation funder in Australia, told shareholders at its annual general meeting that net profit in fiscal 2009 was expected to come in at $20 million, following $17.16 million the prior year.  Class actions in Australia are growing in popularity and because there is no contingent fee model in Australia, IMF has emerged as the leading source of funding for these suits.  Among IMF’s recent successes is the Aristocrat case (discussed here), in which it was awarded $37 million of the $144 million settlement (with the law firm Maurice Blackburn getting about $8.5 million of IMF’s take).

Similarly, it was reported today in the Australian press that law firm Slater & Gordon, which is actually publicly traded in Australia, expects strong growth in fiscal 2009 as it beefs up resources to meet demand for its services amid fallout from the economic crisis.   The firm is a leader in Australia in the plaintiffs’ securities class action area.