Jarra Creek Central Packing Shed Pty Ltd v Amcor Limited

REASONS FOR JUDGMENT 1 These reasons concern an application for further discovery by Jarra Creek Central Packing Shed (Jarra Creek), which is opposed by the respondents. For the purposes of the Judgement, the first, second and third respondents will be referred to as the Amcor Parties, and the fourth, fifth and sixth respondents as the Visy respondents. 2 The principal question raised on this application is the level of discovery which should be made in this matter. Jarra Creek in its Amended Notion of Motion (filed on 10 December 2008) first seeks general discovery of all documents related to the effect of the Visy respondents' conduct on the prices of Cardboard Fibre Products (CFP) supplied by them in Australia, and the alleged loss and damage suffered by Jarra Creek and group members for a period between 1 January 1998 to 1 May 2006 to the extent that such documents have not already been discovered by the Visy respondents. 3 Secondly, and in the alternative, a more specific order is sought seeking discovery and production of a Logistics Database referred to in an affidavit of Mr Zwier, filed on behalf of the Visy respondents in this matter, as well as discovery of other electronic records so far as they contain data of CFP sales, and production data, and also information relating to Pulp Paper Products (PPP), as to sales and production data at a low level of particularity, together with details of sales/price, costs of production and production data for the products at customer level. In addition, the order seeks any hard copy documents created between 1 January 1998 and December 2004 recording costs of production at the customer and product level. 4 In substance, the dispute between the parties concerns the appropriate particularity and detail at which discovery should be made. I have made previous orders for discovery in this matter on 19 November 2007: see Jarra Creek Central Packing Shed v Amcor Limited (2007) FCA 1559, which sets out the general background. The Visy respondents contend that nothing material has changed since those orders and that there is no need for further orders of discovery because the present application seeks documents that were sought but not ordered to be produced on the previous application. The Visy respondents also say that, although after the making of the previous orders the applicant amended its pleading, in respect of the essential allegation for discovery purposes, there has been no significant change. 5 It is submitted for Jarra Creek that the court should note that since the earlier discovery order the Amcor respondents have agreed to provide documentation at a far greater level of specificity than in the original orders and further that there is additional material from Professor Rubinfeld (of 19 Nov ember 2008), an economic expert, retained on behalf of Jarra Creek, to the effect that in order to determine whether the alleged cartel arrangement can be properly the subject of an expert opinion, it is necessary to have discovery in relation to the sales/price, costs of production and production data at the production facility level. Also, in order to construct a proper economic model, and conduct a detailed analysis of conditions conducive to cartel formation and quantify the effect on market process, Professor Rubinfeld considers that is necessary to obtain sales/price, costs of production and production data at customer level and product level. 6 Professor Rubinfeld has read and refers to an affidavit of Ms Rebecca Gilsenan (Ms Gilsenan), the solicitor acting for Jarra Creek, dated 9 December 2008, which sets out inconsistencies and gaps in the material produced on behalf of the Visy respondents and notes that some of this discovered material also refers to low level specific data known to exist from documents discovered and information given to her. This detailed affidavit was not the subject of challenge or cross examination as to the factual material stated in it. 7 The evidence discloses that there has been substantial discovery to date. For example, Visy has discovered 15,572 documents. Of these, 4,730 are financial documents or reports and 2973 are classified as spreadsheets, tables and lists. In summary, Ms Gilsenan says that the financial data discovered by Visy is aggregated at the level of production facility which would allow Jarra Creek to calculate the difference between costs and sales prices on average for all, but not each, of the customers of a particular facility, but that the coverage is incomplete and it would be necessary to make assumptions. She states that she does not have sufficient data at customer and product levels to allow the Jarra Creek's representatives to ascertain the process by customer or product or by classes of customer or product. The material presently furnished is at a high level of generality and Ms Gilsenan says that while she has some low level data of a specific nature, it is restricted to particular customers or limited time periods, and there is not enough to determine net pricing even for those customers. The existence of some low level data reinforces the view that such data exists and this is confirmed by evidence from the Visy respondents. 8 Mr Leon Zwier (Mr Zwier), solicitor for the Visy respondents, has filed evidence in this matter and in his Fourth Affidavit of 8 December 2008 he refers to the earlier discovery decision over a year ago. In relation to Visy data concerning CFP at the customer and product level, Mr Zwier says that the Visy respondents have in their possession a database known as the Logistics Database. This Logistics Database contains data relating to CFP supplied by Visy Board at an account and product level from before 1 January 1998 to December 2008. A single customer of Visy Board can have multiple accounts. Mr Zwier describes this Logistics Database and its capacity to produce reports in a number of different formats. In paragraphs 22-28 of his affidavit he spells out further details of the database and points to the extremely large volume of documents arising from the fact that at any given time between 1 January 1998 and 1 May 2005 Visy had between approximately 5,000 and 7,000 different customers from time to time. The Visy respondents had created a list of all product lines sold in each calendar year over a six year period which, if printed, would amount to over 22,400 pages relating to CFP sales price and production data at customer and product level. 9 Mr Zwier also refers to CFP cost data at customer and product level. In addition, he refers to the volume of material in relation to the discovery of financial reports relating to PPP. He expresses the view of the Visy respondents that to the extent that financial information at the customer level is relevant to the issues in the proceeding, it is in substance only relevant to the calculation of alleged loss or damage of individual customers who are group members, and that the calculation of any loss or damage suffered by individual customers who are group members should await the determination of liability and other common issues in the proceeding. 10 Mr Zwier says that if the Court proposes to order discovery in respect of the alleged loss or damage suffered by individual customers of Visy who are group members, it would be necessary to identify which of its customers are group members. That is to say, customers who purchased and paid more than $100,000 for CFP in Australia in the period between 1 May 2000 and 2005. 11 The Visy respondents contend that the production of the material is not necessary at this stage of the proceedings and that the degree of detail extends to particulars of damages or loss in relation to individual customers and that it is not appropriate to provide this material. 12 Mr Zwier submits that it is only appropriate that the Visy parties produce what might be described as higher or general management reports and financial documents. 13 In this case the questions of liability and damages have not been split, and indeed it may be very difficult to draw any clear line between evidence necessary to support the liability claim and evidence necessary to establish the liability identity and quantity of damage or loss suffered. 14 I am not persuaded that the production of documents at the higher generalised level will suffice, particularly having regard to the evidence of Mr Rubinfeld filed since the earlier discovery order. In my view, the production of such material is necessary to enable Jarra Creek to properly prepare its case, having regard to the data sought at the lower level of specific particularity. At this lower level it is worth noting that the Amcor parties have agreed to make these documents available. This fact, coupled with the evidence of Professor Rubinfeld and the unsatisfactory nature of the discovery to date, leads me to conclude that orders substantially in the form sought by Jarra Creek should be made. Professor Rubinfeld in his latest report of 19 November 2008 also confirms the importance of receiving data in an electronic form and in the same level of detail as the original source data. Moreover, this matter was commenced over two years ago and it needs to progress in a timely way. This consideration favours a comprehensive discovery order rather than a series of separate applications and arguments. 15 In this judgment I will not settle the final terms of the present discovery order but I indicate that I decline to make the vague general order as sought in the Amended Notice of Motion in Prayer 1. I think an order along the lines of Proposed Order 2(a) and (b) of the Amended Notice of Motion of 10 December 2008 would be an appropriate next step. The Draft Data request on pages 81 and 82 to the Affidavit of Ms Gilsenan points to the difficulties in framing a more specific request for documents and indicates that, in my view, more thought needs to be given to the specific terms of the discovery having regard to these reasons. 16 I therefore direct the parties to ring in Short Minutes to give effect to these reasons. As to costs, if there is any dispute as to these they can be resolved when the matter comes back before the Court. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tamberlin.