Macquarie Bank will have to negotiate a fresh carve-up of the A$82.5 million offered in settlement of a long-running wrangle with investors who were advised by Storm Financial and funded by Macquarie.The full court of the Federal Court of Australia heard yesterday that an earlier settlement, reached in March, "cannot be said to be fair and reasonable to all group members. A substantial wrong has occurred which the court is obliged to correct."The Australian Securities and Investments Commission had moved to appeal the original settlement, which, it argued, favoured certain clients of the plaintiff law firm, Levitt Robinson Solicitors, who had chipped in to help fund the case.The original settlement had provided for the distribution of the settlement funds between approximately 1050 group members. The court said the size of the settlement pool "is not in issue"."The principal issue on appeal is whether the primary judge erred in finding that the distribution of the settlement sum between group members was fair and reasonable."ASIC had contested a component described as the "funders' premium", which, it argued,  not only compensated the funding group members, for the amounts paid by them by way of funding, but constituted an arbitrary profit and an unfair advantage to the funding group members at the expense of the remaining members.Justices Jacobson, Middleton and Gordon wrote at the conclusion of their judgement that "not only was there inequality of opportunity afforded to [some] group members to share in the funders' premium, but advantageous terms were offered, after the settlement was reached at the mediation.""Those terms were available only to clients of Levitt Robinson. "If there is an analogy, it is that a small number of group members (who were also clients of Levitt Robinson) were able to place a bet on a horse race after the race had run and knowing the result of the race."The judges said "the inequality was heightened by the ex post facto offer of highly attractive terms to a small group of Levitt Robinson clients after the settlement was announced on 15 March 2013."