THE law firm behind a mammoth class action against the failed forestry group Great Southern that began yesterday is also considering whether to launch a similar action against Gunns.

A principal with Macpherson + Kelley, Ron Willemsen, said the firm was weeks away from filing a class action against a third failed forestry group, Willmott Forests, which it is already pursuing in Federal Court proceedings.

The trial of Great Southern began in the Victorian Supreme Court yesterday, filling the room with more than 30 lawyers representing investors in the company’s managed investment schemes, its directors and Bendigo and Adelaide Bank, which lent money to investors.

Macpherson + Kelley represent about 2000 of the 22,000 people who, if the class action succeeds, stand to benefit by having their investments returned and the loan used to finance it declared invalid.

The trial, before Justice Clyde Croft, is expected to run until at least early March and to call witnesses, including Great Southern’s founder John Young.

Counsel for the investors, Garry Bigmore, QC, showed the court a product disclosure statement from 2005 that featured, on its cover, a photograph of a gum tree seedling cradled in a pair of hands.

He asked if the picture represented ”nurture of an iconic natural resource for profit, or dirty hands”. ”The growers were induced to invest by the former. They have suffered as a result of the latter,” he said.

Wood production forecasts by Great Southern could never have been achieved, he said. The company would never have been able to plant the forecast 250 cubic metres of harvestable wood on each 0.33 hectare lot; it did not have enough land and would have known at the time of writing the product disclosure statement that it would have to ”top up” its eucalypt forests with timber from another source to give investors the projected returns, he said.

”The Great Southern story is the familiar one of greed; forever increasing sales of agribusiness managed investment products triumphing over diligence in the transparent offering of fair investments.”

Counsel for Mr Young, Paul Santamaria, SC, said this was ”nonsense”. ”Investors who participated in the schemes did so with their eyes wide open,” he said.

Mr Young had approved the product disclosure statements after getting advice from some top-tier law firms, including Freehills, he said. ”Mr Young’s approach was you pay top dollar to get the best advice … and the [Great Southern] group paid top dollar and got advice of high quality. Mr Young was every bit entitled to rely on that advice.”

Great Southern, which collapsed in 2009, was the largest player in a managed investment scheme industry that has been all but wiped out by a series of failures.

Timbercorp also collapsed in 2009, with Willmott following in 2010 and Gunns going into administration in late September.

Speaking outside the court, Mr Willemsen said his firm was looking at launching action over Gunns’ 2008 and 2009 managed investment schemes. ”They’re closer to the time of Gunns running out of money and not having been in a strong position to deliver on the project,” he said.

He said Macpherson + Kelley would also file a class action lawsuit over a forestry scheme run by Willmott Forests in 2010.

”There are other schemes in relation to Willmot that are already the subject of class action proceedings in the Federal Court, so this one is to catch up with the others,” he said.