The smaller dragons Ebonroc, Flamegor and Firemaw apply the debuff in a frontal cone. Requiring only the tank to have the cloak equipped for those fights. Nefarian however applies the debuff in an aoe, which ignores line of sight. Though there exist a known bug which allows his throne to block the shadow flame damage completely.
As nefarian only cast the spell once. It's possible for the Alliance, to do it with a single cloak on their main tank. As their paladins can use divine shield to remove the debuff. It should even be possible to do it with no cloaks at all, provided you stack enough paladins to heal through the debuff which deals 17500-22500 damage over 10 seconds.