Case: Australian Competition and Consumer Commission v Visy Industries Holdings Pty Limited (No 3) [2007] FCA 1617
Outcome: cited
Although the attribution of the statements to the ACCC is acknowledged to be incorrect, counsel for Maurice Blackburn sought to minimise the importance of such an attribution. Counsel argued that the ACCC had made several statements in various publications which, taken together with inferences which can be drawn from the judgment of Heerey J in the proceeding between the ACCC and the Visy parties and others (see Australian Competition and Consumer Commission v Visy Industries Holdings Pty Limited (No 3) [2007] FCA 1617) , support the inference that the ACCC held a view that an overcharge in the order of 10 per cent existed in this case. Counsel for Maurice Blackburn also submitted that there was some qualification of the range of between 8 and 23 per cent overcharge in the Further Amended Statement of Claim at [100]-[103], which points to the necessity for discovery before damages can be further particularised. 15 Counsel for Maurice Blackburn further submitted that, when considering the effect of the statements, regard should be had to the fact that the group members, as defined, are not simply a general cross-section of the public, but rather the specific group of persons or entities who have contracted for more than $100,000 worth of packaging products over the five year period. It is said that such persons should be treated as a "sophisticated" class of people who would be more likely to consult legal advisers and rely on their own business acumen rather than accept, without qualification, broad assertions by Mr Slade. I am not persuaded that such an inference can reasonably be drawn in the present case. The fact that someone pays $100,000 or more for packaging products does not, in my view, mean that they are more or less astute or more or less likely to be influenced by false representations in this matter than any other members of the community. 16 In considering this application, I am conscious of the uncertainty which must surround any quantification of damages at such an early stage in the proceeding, before the settlement of pleadings, return of subpoenas, full discovery and filing of evidence. However, it is necessary to ensure that the appraisal by an applicant (or any group member in a representative proceeding) of its position is not artificially inflated as to the likely monetary rewards which will flow from the litigation. This is particularly important in a complex representative proceeding, where it might be said that a group member will generally be less likely to opt out of the proceeding when the return, in its perception, is likely to be great. Of course, this may not always be so, and there may be particular circumstances apart from the amount of the prospective return, such as a desire to exercise greater control over the litigation process or the ventilation of specific issues, which could have an impact upon the decision to opt out. 17 Notwithstanding attempts by counsel for Maurice Blackburn to downplay the significance of the incorrect attribution to the ACCC, I consider that it was an important misrepresentation. This is because it is reasonable to conclude that the view of the ACCC given its detailed knowledge of the alleged cartel arrangement, its resources and its statutory function would carry significant weight with the group members in this case, and perhaps engender in them an erroneous assumption that the view of Mr Slade or Jarra Creek in relation to the eventual outcome of the case is a view shared by the ACCC. Although Maurice Blackburn has not hesitated to acknowledge the inaccuracy of the attribution of the relevant comments to the ACCC and has also offered not to repeat those comments, no satisfactory public acknowledgment has been made. Moreover, Mr Slade has not given any explanation of the basis on which the comments were made and what mechanisms are now in place to ensure they are not repeated. 18 In my view, the statements by Mr Slade are capable, on one reading, of misleading group members. In particular, the incorrect attribution of their content to the ACCC imparts to those statements a quality of authority that they would not otherwise attract if they were seen as coming only from Jarra Creek or its legal representatives. Indeed, this impression of greater authority is especially important when statements are made in the context of an opt out procedure, where group members are attempting to decide whether it is in their best interests to remain a part of the group or seek to conduct separate litigation. In particular, the reference to a total overcharge of one billion dollars could have a significant impact on a group member's opt out decision. 19 In this case, I consider that there is a need to publish a correction of the misstatements and that as a consequence the date by which a notification of opting out should be given to the Court is deferred by one month. I do not think that an inter partes undertaking by Maurice Blackburn to the Visy parties is sufficient to remedy the potential impact of the false statement in this case. Accordingly, I shall order that a correcting statement be published forthwith. The form and content of that correcting notice should be the subject of discussion between the parties, however it should as a minimum include (i) a correction of the misstated attribution; (ii) a statement that the opt out date has been extended from 4 pm on 30 April 2008 to 4 pm on 30 May 2008; and (iii) a statement of the difficulty of quantifying at this stage the amount of damages that might eventually be awarded by the Court if the representative proceeding is successful. I direct that, once the parties agree on the form of the notice, it should be sent to my Associate in chambers within three days of the date of these reasons for approval by the Court. If agreement cannot be reached, the points of difference should be identified, and the competing forms of notice sent to my Associate in chambers within three days of the date of these reasons, with brief reasons, for settlement by the Court. By adopting this course, the Court seeks to make it perfectly clear to anyone presently within the group that the integrity of the opt out process is closely monitored by the Court in order to ensure that it is properly carried out. 20 With respect to the other relief sought by the Visy parties, I do not think that an injunction against Maurice Blackburn is necessary. As I have noted, Maurice Blackburn proffered an undertaking not to repeat the comments which attribute certain representations to the ACCC. A restraining order would, in my view, be inappropriate in such circumstances. I have no doubt that this judgment will induce caution on the part of Maurice Blackburn in the future. In addition, I do not consider that there are reasonable grounds established for any inference that Mr Slade has made other similar statements, and so I am not prepared to order that he file an affidavit particularising any such further statements. 21 I consider that the applicant should bear the costs of correcting the statement in relation to the ACCC. 22 The costs of this application are reserved. I certify that the preceding twenty-two (22) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tamberlin. Associate: Dated: 29 April 2008 Counsel for the Applicant: Mr S. Gageler SC and Mr I. Wylie Solicitor for the Applicant: Maurice Blackburn Pty Ltd Counsel for the First to Third Respondents: Mr R. Harris Solicitor for the First to Third Respondents: Allens Arthur Robinson Counsel for the Fourth to Sixth Respondents: Mr J. Beach QC and Mr M. O'Bryan Solicitor for the Fourth to Sixth Respondents: Arnold Bloch Leibler Date of Hearing: 21 April 2008 Date of Judgment: 29 April 2008 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2008/575.html