Central Innovation Pty Ltd v Garner

1. The first respondent's objections to the applicants having access to the material produced on subpoena by Discount Domain Name Services Pty Ltd (DDNS) and by Telstra Corporation Limited (Telstra) be rejected.
2. The applicants have access forthwith to the material produced on subpoena by DDNS and by Telstra.
3. The first respondent pay the costs of and incidental to the process from when objection was first taken by him to the subpoenas addressed to DDNS, to Telstra and to Microsoft Pty Ltd. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BROMWICH J: 1 On 26 March 2019, I made the following orders, with reasons to follow: 1. The first respondent's objections to the applicants having access to the material produced on subpoena by Discount Domain Name Services Pty Ltd (DDNS) and by Telstra Corporation Limited (Telstra) be rejected. 2. The applicants have access forthwith to the material produced on subpoena by DDNS and by Telstra. 3. The first respondent pay the costs of and incidental to the process from when objection was first taken by him to the subpoenas addressed to DDNS, to Telstra and to Microsoft Pty Ltd. 2 These are the reasons for the making of those orders, which entail the adjudication of a subpoena dispute between the applicants and the first respondent. The second respondent took a neutral stance and has not participated in this dispute. 3 The nature of the substantive proceedings may be shortly stated. The first respondent was a former employee of one or the other or both of the applicants - it does not presently matter which. The applicants allege he took confidential information obtained during the course of his employment and used it to gain an advantage in breach of his contractual, fiduciary and statutory obligations to both or either of the applicants. On the face of the pleadings, the first respondent was, for a time, employed by the second respondent, a competitor of the applicants. The applicants are endeavouring to assemble evidence for the proof, inter alia, of the central issue in their case, being the obtaining and dissemination of confidential information by the first respondent. It is important to note that the information alleged to have been obtained and misused is digital, rather than paper. It is an electronic trail that is sought to be established by the applicants. 4 A further point to note is that the applicants have had some frustration in obtaining the information they seek by way of expert examination by a court-appointed computer expert of certain records of the second respondent, and now seek to obtain further information, and thereby evidence that they need, by subpoena. 5 The two subpoenas in relation to which documents have been produced, and access now granted, were in the following terms as to what was sought to be produced: (1) Discount Domain Name Services Pty Ltd (DDNS) subpoena (omitting defined terms): 1. All contractual documents entered into between you and N C Cadcam Systems Pty Ltd (NCCS). 2. All data, disks, back-up tapes, documents and correspondence (including emails) exchanged between you and NCCS during the period 20 December 2016 to 28 February 2017. 3. All user activity logs in relation to NCCS during the period 20 December 2016 to 28 February 2017. (2) Telstra Corporation Limited (Telstra) subpoena (omitting defined terms and mobile numbers): A. [Garner NCCS Mobile] 1. Copies of the mobile telephone bill or other records for the mobile telephone number [omitted] for the period 1 November 2016 to 23 December 2016 (inclusive). 2. Copies of any documents or other records for mobile telephone number [omitted] for the period 1 November 2016 to 23 December 2016 (inclusive) showing or identifying: (a) all individual itemised call details or national direct calls (including calls received from made to other mobile telephones), including sequence number, date, time, origin (location), number dialled, number calling, and/or length of time of call; and (b) all individual itemised SMS or text messaging details or mobile originated SMS or text messaging details, including sequence number, date, time, origin (location) and number dialled or communicated to or number received from via SMS or text message. 3. In the alternative to paragraphs 1 and 2 above, if you are not the mobile telephone provider for the mobile telephone number [omitted] for the whole or part of the period 1 November 2016 to 23 December 2016, confirmation of same in writing. B. [Garner personal Mobile] 4. Copies of the mobile telephone bill or other records for the mobile telephone number [omitted] for the period 1 July 2016 to 23 December 2016 (inclusive). 5. Copies of any documents or other records for mobile telephone number [omitted] for the period 1 July 2016 to 23 December 2016 (inclusive) showing or identifying: (a) all individual itemised call details or national direct calls (including calls received from or made to other mobile telephones), including sequence number, date, time, origin (location), number dialled, number calling, and/or length of time of call; and (b) all individual itemised SMS or text messaging details or mobile originated SMS or text messaging details, including sequence number, date, time, origin (location) and number dialled or communicated to or number received from via SMS or text message. 6. In the alternative to paragraphs 4 and 5 above, if you are not the mobile telephone provider for the mobile telephone number [omitted] for the whole or part of the period 1 July 2016 to 23 December 2016, confirmation of same in writing. 6 On 16 January 2019, a registrar of the Court made the following orders: THE COURT ORDERS THAT: 4. Any further written submissions in relation to the hearing of all issues concerning all of the subpoenas and documents produced (hearing) be filed and served by the Applicant on or before 4:00pm on 30 January 2019. 5. The Respondents file and serve their response by 14 February 2019. 6. The hearing be referred to his Honour, Justice Bromwich. 7. The costs be reserved. 7 Pursuant to the above orders, the parties furnished written submissions and agreed to the determination of the dispute on the papers. 8 Subpoenas may be used to obtain evidence to support a case, but not merely to discover whether a case exists at all: Commissioner for Railways v Small (1938) 38 SR (NSW) 564 at 575. The live issue when an objection is taken to the production of documents in answer to a subpoena, or to the access to such documents once produced, in the absence of oppression which is not suggested in this case, was stated with economy in R v Saleam [1999] NSWCCA 86 in part of [11] as follows: Before access is granted (or an order to produce made) the applicant must (i) identify a legitimate forensic purpose for which access is sought; and (ii) establish that it is "on the cards" that the documents will materially assist his case. So much was established in earlier proceedings brought by this applicant: R v Saleam (1989) 16 NSWLR 14, per Hunt CJ at CL; see also R v Ali Tastan (1994) 75 A Crim R 498 per Barr AJ, as he then was. 9 The expression "on the cards" is derived from the judgment of Gibbs CJ in Alister v The Queen (1984) 154 CLR 404 at 414. Saleam was expressly endorsed in Attorney-General (NSW) v Chidgey [2008] NSWCCA 65; 182 A Crim R 536 at [64]. Chidgey is authority for the proposition that establishing mere relevance of the material sought will not suffice: see [80]. The test of it being "on the cards" that the material sought will assist the case of the party that has caused the subpoena to be issued therefore endures. However, that greater degree of relevance required to be established is still not at the level of admissibility into evidence, but rather at the adjectival level of apparent relevance to the issues in the substantive proceedings: Trade Practices Commission v Arnotts Ltd [1989] FCA 340; 88 ALR 90 at 103; Seven Network Ltd v News Ltd (No 5) [2005] FCA 510; 216 ALR 147 at [10]; Cheung Kong Infrastructure Holdings Ltd v BlueScope Ltd [2010] FCA 739 at [33]. 10 The applicants have furnished detailed and comprehensive submissions. It is sufficient to reproduce the overall summary of their position at ([5]-[7]), which is amply made good in the balance of those submissions: In this case, the documents sought in the subpoena to DDNS will reveal whether information from the second respondent's email server is available to indicate that Mr Garner used confidential information taken from the applicants' systems to email the applicants' customers following his employment by NCCS. The subpoena to Telstra calls for documents and information that will assist the applicants to determine whether Mr Garner contacted their customers using telephone numbers and other information which Mr Garner obtained from the applicants' proprietary customer database known as "SUGAR". The documents sought in the subpoenas are clearly capable of throwing light on the principal issues in dispute, including whether Mr Garner obtained and removed confidential information from the applicants during such time that he was in their employ and then used that information in connection with his employment with NCCS, including by contacting the applicants' customers in an attempt to persuade them to move their business to NCCS. The documents are likely to materially assist the applicants' case against the respondents. The test of "apparent relevance" set down by the authorities is accordingly established and Mr Garner's objections are without merit. He has failed to establish any reason why the subpoenas should be set aside. 11 The first respondent's basis for objecting to the applicants having access to the material that has been produced in response to the Telstra and DDNS subpoenas (nothing having been produced in answer to the Microsoft subpoena) is not altogether clear. As best as I can determine, the first respondent's submissions may be distilled to the following core propositions. 12 The first proposition advanced by the first respondent is that because the applicants have not been able to obtain the information they seek from the records of the second respondent that have been examined by the court-appointed expert, due in part to the inability of the expert to find information of the type sought, and due in part to successful legal professional privilege claims by the first respondent, they are not entitled to seek the information they are after by alternate means, namely by subpoena. That argument makes no sense to me at all and I reject it. I particularly reject the suggestion made that any prior orders I have made constitute any barrier to the applicant causing these subpoenas to issue or for such material to be produced. 13 There is nothing wrong with the applicants seeking to obtain evidence and other forensic material from other sources by an otherwise legitimate subpoena. The obtaining of evidence can be a frustrating and time-consuming exercise. An opposing party should exercise restraint in resisting that process taking place without a proper basis for doing so. Yet I did not perceive the first respondent's first proposition to travel much further than mere perceived forensic advantage in obstructing the applicants in seeking to obtain evidence. 14 The second proposition advanced by the first respondent is that, without examining any of the material in fact produced, or at least making no submissions about it, the subpoenas are too broad. That sort of argument usually depends on the proposition being self-evidence on the face of the subpoena. However, this argument was sought to be advanced by rhetoric, not substantive argument, including resort to the sometimes hollow incantation of "fishing". As set out in cl 6.1 of the Court's Subpoenas and Notices to Produce Practice Note (GPN-SUBP), a subpoena must "specify, with reasonable particularly, the documents to be produced and must avoid becoming a mechanism for "fishing" for evidence or documents." Having regard, however, to the modest and confined terms of each of the two successful subpoenas reproduced above, with their already evident purpose being further explained by the applicants' detailed submissions, I cannot see that the subpoenas are, on their face, unduly wide, nor that they lack a legitimate forensic purpose. 15 The DDNS subpoena is appropriately confined both as to subject matter and, in relation to transactional records, a modest time period, which is tied to the period and issues in dispute. The Telstra subpoena seeks transactional records in a confined date range, which is also tied to, or in the lead up to, the period and issues in dispute, neither period being extravagant or otherwise excessive. It is not to the point that a prior subpoena to Telstra, addressing a different time period, has not apparently yielded the information that the applicants seek in order to advance their case. 16 The third proposition advanced is that the subpoenas must be addressed to the questions that the first respondent considers must be asked and answered in the proceeding. Those questions appear to be a correct statement of the key ultimate issues in the substantive proceeding, namely what information is alleged to have been taken by the first respondent, what the use or misuse of that information was, and what the loss or damage occasioned by that use or misuse is. However, subpoenas are not required to go directly to, and be confined to, the ultimate issue in a proceeding. If subpoenas were always required to be confined to directly supplying answers to the ultimate question in litigation, very few would issue. More fundamentally, that proposition is directly contrary to authority, as well as to common sense. As restated relatively recently by Colvin J in Hook v Bux Global Limited (No 2) [2018] FCA 836 (at [38]) "The test of apparent relevance is a low threshold. It is enough if a document or class of documents gives rise to a line of enquiry relevant to the issues before the trier of fact." I was therefore satisfied that this low threshold was easily satisfied. 17 It is for the foregoing reasons that I made orders on 26 March 2019, rejecting the first respondent's objection to the applicants having access to the material produced on subpoena by DDNS and by Telstra, granting the applicants immediate access to that material, and ordering the first respondent to pay the applicants' costs. I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bromwich.