The Court is presently concerned with a Notice of Motion filed by the First Defendant and an application by the Plaintiff in respect of data obtained from the First and Second Defendants following seizure pursuant to orders of the Court made on 17 March 2021.
The First Defendant, Mr Ian Wallace Meyer, was employed by the Plaintiff, Skytraders Pty Ltd ("Skytraders"), as a flight operations manager for a number of years. In December 2019, Mr Meyer announced his resignation from Skytraders, and he ended his employment with Skytraders on 12 January 2020. On 13 January 2020, he commenced employment with the Second Defendant, Air Affairs (Australia) Pty Ltd ("Air Affairs").
In March 2021, Skytraders became aware that Mr Meyer still had access to its Dropbox account ("the Skytraders Dropbox Account") and it became aware that he had accessed a number of documents in the period since he had left Skytraders's employment. Skytraders became aware that Air Affairs, a competitor of Skytraders, had become, or appeared to be, interested in several significant contracts that were up for renewal and which Skytraders was keen to retain or apply for.
Skytraders commenced proceedings on 17 March 2021 and obtained, from Robb J sitting as the Duty Judge, search orders against Mr Meyer and Air Affairs ("the First March Orders"). Those orders required Mr Meyer and Air Affairs to hand over documents physically held and also to hand over or permit access to documents and information stored on various identified devices for the purpose of copying those devices. The process involved, as is usual, the intervention of independent solicitors and independent forensic computer experts.
The initial aspect of the process was carried out and the forensic experts have made digital copies of the devices of both Mr Meyer and Air Affairs. The First March Orders required assessment of the images made but this process has been held up by reason of the applications of the Defendants.
Skytraders seeks to have the forensic experts proceed with what is described as a "mapping process" which will involve the identification of the file paths of folders and the nature of the files contained on each drive. That process will not reveal the content of any document, but it will, Skytraders believes, on the basis of the forensic experts' evidence, enable the work of "interrogation" of the digital information to be cut down to a more manageable size which may reduce the costs involved since it is likely to remove a number of the digital devices from further consideration. The cost of conducting the mapping process is said to be in the order of $20,000: see T.92.37-38. Skytraders will, at least for present, bear that cost.
At the hearing before me on 19 November 2021, Skytraders filed a Statement of Claim ("STOCL"). The STOCL pleads no case against Air Affairs. At the hearing, agreement was reached between Skytraders and Air Affairs that the proceedings as against Air Affairs would be discontinued, Skytraders would pay Air Affairs's costs and Air Affairs would undertake to maintain the integrity of all images on identified devices for two years from 19 November 2021. The application for access to the copy of Air Affairs's server is no longer made and the only material belonging to Air Affairs in respect of which Skytraders seeks mapping to be carried out is the laptop owned by Air Affairs but in the possession of Mr Meyer.
Mr N Hutley SC with Mr A Zahra SC appeared for Skytraders. Mr A Bannon SC with Mr M R Davis appeared for Mr Meyer. Mr I Jackman SC with Mr P Knowles appeared for Air Affairs.
Mr Meyer, by his Notice of Motion, seeks to preclude access by Skytraders to the material obtained through the First March Orders. He does not now press for an order for destruction of the images made by the independent forensic experts. He contends that the usual process should now be followed; namely, that he file a defence and that he give discovery in the ordinary course.
Mr Meyer contends that Skytraders, in its application before Robb J, misstated or failed to disclose two matters of significance. This issue has been characterised as the "non-disclosure issue" and I shall refer to it as that.
The non-disclosure issue has two separate and discrete elements:
1. the manner in which Mr Meyer's access to the Skytraders Dropbox Account was described to the Court; and
2. the claims of confidentiality made by Skytraders in respect of the documents which Mr Meyer had accessed since his departure from Skytraders.
Mr Meyer also contends that even if his non-disclosure contentions are not accepted, there should be no mapping process conducted since that would provide, to Skytraders, an advantage or control over Mr Meyer's documents that it should not have. Seizure orders, he submits, should only be used to safeguard material from destruction and should not be used to put the Plaintiff in a better position than it would have been had no seizure order been sought and obtained. I shall refer to this as "the status quo point". He relies in support of this contention on Microsoft Corp v Goodview Electronics Pty Ltd (1999) 46 IPR 159; [1999] FCA 754 ("Microsoft Corp"), Metso Minerals (Australia) Ltd v Kalra (No 3) [2008] FCA 1201 ("Metso (No 3)") and Findex Group Ltd v Mckay [2019] NSWCA 93 at [26] per Basten JA (with whom Sackville and Emmett AJJA agreed) ("Findex CA"). He contended that what should occur is the following:
1. that the First March Order be set aside on account of the alleged material non-disclosure; or, in the alternative,
2. that a timetable be put in place for Mr Meyer to file a defence and, thereafter, for the proceedings to continue in the ordinary course, which may include, at an appropriate (later) time, discovery.
Relevant to the non-disclosure issue are the following matters:
1. Skytraders alleges that many of the documents stored on the Skytraders Dropbox Account were and are confidential to it and would be highly valuable in the hands of a competitor, including Air Affairs.
2. Skytraders's employees were given access to Dropbox through an email account with their name coupled with "@skytraders.com". Mr Meyer had access by this means. When he left Skytraders, this access was closed. As far as Skytraders's management personnel are concerned, the Skytraders Dropbox Account was designed to only be accessed with an account of the style "@skytraders.com".
3. When he had first commenced at Skytraders, Mr Meyer, he deposes, had been permitted to use his Gmail account because he was not given an account framed as "@skytraders.com", but within a few years, he was given a "@skytraders.com" account, which he used on a frequent basis. Mr Meyer claims that he continued to have access to the Skytraders Dropbox Account via his personal Gmail account, even after he had commenced using the Skytraders account. Mr Meyer's contention that his initial use of his Gmail account gave him access to the Skytraders Dropbox Account is not accepted by Skytraders. Mr Calum Mackay speaks, at paragraph 20(e) of his affidavit of 27 July 2021 of a "proxy function" having been set up by Mr Meyer and it may be, having regard to the evidence of Ms Rey, that that is how the present situation arose whereby Mr Meyer has, until recently, continued to have access. On Mr Meyer's evidence, it was Skytraders who organised his early access in this fashion, not him.
4. It seems clear that at the time he left Skytraders in January 2020, whoever was responsible for terminating Mr Meyer's access to the Skytraders Dropbox Account did not appreciate that Mr Meyer still had access via his personal Gmail account.
5. After he left Skytraders, Mr Meyer was able to, and did, access documents that he had received via the Skytraders Dropbox Account. Mr Meyer asserts that his personal Gmail account had connected to it his personal Dropbox account and that he would often receive hyperlink email invitations granting him access to the Skytraders Dropbox Account via his personal Gmail account. Mr Meyer asserts he was labouring under the assumption that upon the cessation of his employment with Skytraders, he no longer had access to the Skytraders Dropbox Account (including via his personal Gmail account) and that it was not until the commencement of these proceedings that he became aware of his access to the Skytraders Dropbox Account via his personal Gmail account. Again, that is not a contention accepted by Skytraders and Skytraders points to the fact that there is no document advanced by Mr Meyer containing an invitation to access any of the 14 documents which are presently the subject of these proceedings. Whilst Mr Meyer has exhibited some Dropbox invitations (see paragraph 17 at CB 1045), those invitations are from 2018, when he was employed by Skytraders. Further, even assuming that Mr Meyer did receive Dropbox invitations for the identified documents which lead to the commencement of these proceedings, a question arises as to whether, knowing that he had received such invitations, he had an obligation to draw to Skytraders's attention the fact that he was still receiving material from Skytraders to which he had no entitlement.
6. In February 2020, Mr Colborne, a pilot and employee of Skytraders, noticed that Mr Meyer's Gmail account was an account with access to particular documents on the Skytraders Dropbox Account and he removed that access. In January 2021, Mr Calum Mackay discovered that Mr Meyer had access to a Dropbox folder via his Gmail account and he similarly removed Mr Meyer's access to that folder.
7. There is clear evidence that Mr Meyer had access to the Skytraders Dropbox Account between 12 February 2020 and 24 May 2021 (see Mr Whitbourn's report at paragraphs 3.2.2(b), CB 829) even though Mr Meyer's devices were not registered as devices as part of Skytraders's business subscription: see Mr Whitbourn's report at paragraphs 3.2.2(b), CB 829-830.
At the hearing of the Motion, Mr Bannon identified the material that Mr Meyer relied on in support:
1. the affidavit of Mr Norman Mackay of 17 March 2021 (CB 200-411) and the exhibit thereto;
2. the affidavit of Mr Calum Mackay of 17 March 2021 (CB 412-425);
3. the confidential affidavit of Mr Norman Mackay of 17 March 2021 (CB 1456-1458) and the confidential exhibit thereto;
4. an expert report of Mr Roger Chambers dated 27 September 2021 (CB 1189-1248);
5. the transcript of the ex parte hearing before Robb J (CB 1315-1324);
6. the affidavit of Mr Meyer of 24 May 2021 (CB 1041-1089);
7. paragraphs 1-5 and 45 of the affidavit of Mr Daniel Colborne dated 27 July 2021 (CB 671-810);
8. an expert report of Ms Stephanie Rey dated 20 September 2021 (CB 1098-1120); and
9. paragraphs 1, 2 and 90 of the affidavit of Mr Calum Mackay of 27 July 2021 (CB 453 and 481).
Mr Zahra identified the material relied upon by Skytraders in response as:
1. the affidavit of Mr Calum Mackay of 27 July 2021 (CB 451-484), plus exhibit CM-4 (CB 485-670) and confidential exhibit CM-5 (CB 1731-2448);
2. confidential exhibit NM-2 to Mr Norman Mackay's confidential affidavit of 17 March 2021 (CB 1459-1730);
3. the confidential affidavit of Mr Norman Mackay dated 17 March 2021 (CB 1456-1458);
4. the balance of the affidavit of Mr Colborne (CB 671-683);
5. exhibit DC-1 (CB 684-810) and confidential exhibit DC-2 (CB 2449);
6. an expert report of Mr Trent Whitbourn dated 27 July 2021 (CB 811-902);
7. paragraphs 73 and 82 of the report annexed to the affidavit of Ms Alexandra Isabella White dated 21 March 2021 and annexure E to that affidavit (CB 67, 69 and 95-97);
8. an expert report of Mr William Byron AM dated 2 November 2021 (CB 974-1035); and
9. two letters from Mr Meyer's solicitors, Eakin McCaffrey Cox, dated 25 and 26 March 2021 (CB1423-1424 and 1428-1429).
In light of the nature of the application brought by Mr Meyer (namely, the non-disclosure issue), the transcript of the ex parte hearing before Robb J has assumed some significance. Attention should be drawn to the following two matters:
1. Firstly, as is often the case in the Duty List of the Equity Division in this Court, his Honour appears to have been limited by time constraints at the ex parte hearing, particularly because Skytraders was seeking sealed orders prior to the closure of the Court's registry so it could provide those orders to the independent solicitors who intended to attend Mr Meyer's personal residence and Air Affairs's business premises the following morning. At T1.48-T2.1, his Honour said:
"I am sorry to interrupt you, Mr Zahra. It is 25 to 5, and it may be after 5 o'clock. You will have difficulty getting orders out of the registry, if your solicitors have not made some prior arrangement. I am not sure whether I lose the Court reporter at 5. So you should bear that in mind."
and, at T2.20-23, his Honour said:
"All right. Well, when [sic]. There has to be time for me to go through the orders and do the formal steps, and my associate will have to process the orders here. Realistically, we may need to get on with it, and possibly leave out aspects of explanation that would ordinarily be given."
1. Secondly, in light of the time constraints and the fact that his Honour had read the affidavits upon which Skytraders relied prior to the hearing, his Honour does not appear to have been specifically taken to the confidential documents upon which Skytraders relied in support of the relief ultimately obtained. At T1.33-39, his Honour relevantly said:
"Now, I have read the affidavits. I have not had an opportunity to read any part of the exhibits, although I don't presently have a view that I need to.
In principle, it seems to me to be appropriate to make the orders sought. But I will give you an opportunity to say what you think is appropriate in support of the application."
At T3.2-24, Mr Zahra relevantly submitted:
"If your Honour will have seen from the evidence that the first defendant ceased his employment at the beginning of 2020, and is now employed by a competitor of the plaintiff, the second defendant, which is Air Affairs Proprietary Limited.
And the documents also make plain that the first defendant has using his unauthorised access, gained access to various confidential documents. And Mr Norman Mackay, as your Honour will have seen from his affidavit, at paragraphs 47 to 67, explains in some considerable detail how those documents may be used or may be relevant for various government tenders, including tenders which are either coming up or in the process of being considered and addressed at the moment.
And it is perceived that the first defendant, now being employed by the second defendant, has actually had some involvement in those tenders. Your Honour will have seen that he was in fact even used in a Zoom tender participation call representing the second defendant.
That's a very brief overview. It is submitted, your Honour, that there is a strong prima facie case against the first defendant, both a breach of contract, his employment contract; breach of the terms of the confidentiality agreement; the fiduciary duty he owes; and contraventions of section 182 and/or 183 of the Corporations Act."
The First March Orders were carried out at Air Affairs's premises and Mr Meyer's residence by the independent computer experts, independent solicitors and solicitors for Skytraders, William James, on 18 March 2021. In effecting the First March Orders, various electronic devices, servers and hard copy documents were seized and copied.
On 22 March 2021, further orders were made by Robb J, by consent, by which Mr Meyer is restrained from:
"(a) using, or disclosing to any person (other than a solicitor retained by a Defendant for the sole purpose of obtaining legal advice):
(i) all documents, files or other materials (whether in hard copy or electronic form) taken by the First Defendant from the Plaintiff;
(ii) all documents downloaded from the cloud storage Dropbox account maintained by the Plaintiff;
(iii) each of the documents described in the table annexed to these orders and marked "A";
(collectively, "the Confidential Information")
(b) copying, forwarding, distributing, or disclosing to any person or entity (other than a solicitor retained by a Defendant for the sole purpose of obtaining legal advice), destroying, or in any other way defacing or interfering with, all documents containing or referring to the Confidential Information;
(c) counselling, procuring or assisting any other person to do any of the things referred to in 1(a) and 1(b), above."
The orders made on 22 March 2021 remain extant. That notwithstanding, it is the First March Orders that Mr Meyer seeks to have set aside.
It is not in dispute that Skytraders and Air Affairs are commercial competitors. Both Skytraders and Air Affairs operate highly specialised, private aircraft charter businesses within Australia and internationally, and tender for the same or similar contracts issued by various Australian and international government departments. Both companies provide specialist services to federal and State government departments including the Australian Defence Force, the Australian Border Force, the Australian Antarctic Division and Victoria Police.
Mr Meyer (a qualified pilot) was employed by Skytraders between November 2012 and 12 January 2020, during which time he held several positions. Most importantly for present purposes, Mr Meyer was employed as an Acting Operations Manager from June 2014 to July 2017, from which time he was promoted to Operations Manager. He maintained his position as Operations Manager until October 2019, from which time he again held the position of pilot. In his role as Operations Manager, Mr Meyer coordinated and oversaw flying operations, and was involved in Skytraders's tender submissions.
The terms of Mr Meyer's employment with Skytraders were contained in various documents, including:
1. a document styled "Confidentiality Agreement" dated 20 August 2014;
2. a document styled "Skytraders Confidentiality Policy";
3. a document styled "Staff Information Handbook"; and
4. a document styled "Skytraders' (Pilots) Collective Agreement".
The salient terms of Mr Meyer's employment with Skytraders include:
1. In the Staff Information Handbook (CB 302):
"13 Confidentiality
13.1 General
All employees may from time to time have access to information that is confidential. This may include Company information or that provided by one of the Company's Clients. All employees are required to maintain the confidentiality of any such information, even if elements of it may be of public knowledge.
13.2 Use of Information
Any information provided to an Employee by either the Company or one of the Company's Clients, in any form, e.g. hard copy, fascimilie [sic], email, or any electronic media, may use this information only for purposes directly related to their employment or as authorised by the Company. No information, in any format may be given to any other party without the express permission of a Director.
13.3 Return of Information
Any information, manual or document - in any format - issued to an employee, must be returned to the Company immediately upon cessation of employment or when requested.
13.4 Security of Information
It is the responsibility of each employee to maintain the security of any Company information and prevent its dissemination to unauthorised parties. This includes the inadvertent discussion of Company or Client affairs in public places. Employees must be aware that the nature of much of the Company's business can be of a highly sensitive nature and that even unintentional divulgence of seemingly trivial data may have dire consequences."
1. In the Skytraders' (Pilots) Collective Agreement (CB 346):
"33. COMPANY PROPERTY
33.1 Employees must not remove any Company property from any premises without the express permission of the Company including (but not limited to):
(a) goods distributed by the Company;
(b) tools;
(c) documents;
(d) Confidential Information; or
(e) excess materials.
…
34. CONFIDENTIAL INFORMATION
34.1 The Employee may, in the course of his or her employment, have access to information that is confidential.
34.2 The Employee must:
(a) maintain the confidentiality of any Confidential Information; and
(b) report any breaches of this clause 34 to his or her supervisor.
34.3 The Employee may be required to sign a separate Confidentiality Agreement with the Company."
During the course of his employment with Skytraders, Mr Meyer had access to various documents and information confidential to Skytraders. That included, pertinently for these proceedings, access to the Skytraders Dropbox Account. The Skytraders Dropbox Account permitted users (i.e. those employees authorised by Skytraders to have access to the Skytraders Dropbox Account) to have access to the documents and information saved to the Skytraders Dropbox Account with their unique login details.
It is alleged by Skytraders (at paragraph 9 of its Statement of Claim) that throughout Mr Meyer's employment with it, the Skytraders Dropbox Account was the repository for:
"(a) in excess of 25,000 unique documents;
(b) sensitive and confidential documents;
(c) documents relating to Skytraders' operations and flights;
(d) Skytraders' operational manuals;
(e) documents relating to Skytraders' clients …;
(f) documents relating to tender contracts awarded to Skytraders;
(g) documents relating to tenders Skytraders had or was participating in, including draft and final tender submissions and related documents."
The search conducted at Mr Meyer's office (that is, Air Affairs's premises) and at his residence on 18 March 2021, and the comments of Mr Meyer to the persons conducting the search, revealed that:
1. Mr Meyer had hard copies of documents emanating from Skytraders;
2. Mr Meyer had, on various devices, documents in digital form of Skytraders; and
3. Mr Meyer had a disc entitled "Antarctic disk". There is a good reason to believe that the material which is contained on that disc is material belonging to Skytraders.
Exhibit 1, tendered by the Plaintiff at the hearing of Mr Meyer's motion, is a spreadsheet relating to the 14 documents on Dropbox known to have been accessed by Mr Meyer between November 2019 and September 2020. Four of the documents were accessed by Mr Meyer at Yerriyong, which happens to be the location of Air Affairs.
There is evidence that Mr Meyer and Mr Sievers, who is the Chief Executive Officer and majority shareholder of Air Affairs, were present at a briefing for tenders to Victoria Police: see paragraph 61(h) of Mr Norman Mackay's non-confidential affidavit of 17 March 2021. There is also evidence that Air Affairs is interested in tendering for the Antarctic work for which Skytraders is currently engaged.
Skytraders contends that all documents of Skytraders that are in the hands of Mr Meyer or under his control should have been returned when he left Skytraders. Mr Bannon contended that no one asked Mr Meyer to return the documents held by him. Mr Hutley responded that Mr Meyer's obligation to return documents was not dependent upon a request. Mr Bannon says Mr Meyer is now willing to destroy all documents of Skytraders that he holds physically or in digital form, although he is currently prohibited from doing so.
It is also alleged that after he left Skytraders, Mr Meyer provided copies of Skytraders's documents to a Mr Terrence Vickers, director of Premier Aviation Pty Ltd ("Premier"). Premier is or was a shareholder in Skytraders and there has been litigation between the two companies.
The primary case advanced against Mr Meyer is that he has used Skytraders's confidential information in a manner inconsistent with his obligations to Skytraders pursuant to the terms of his employment with Skytraders, which include the obligations contained in ss 182-183 of the Corporations Act 2001 (Cth), at common law and in equity. More specifically, it is alleged that Mr Meyer accessed 14 documents from the Skytraders Dropbox Account, 10 of which are said to be confidential, in breach of the terms of his employment with Skytraders. Five of the impugned documents were purportedly accessed by Mr Meyer whilst he remained employed by Skytraders through his Skytraders email account, while the remaining 9 documents are said to have been accessed by Mr Meyer via his personal Gmail account after the cessation of his employment with Skytraders.
Skytraders alleges that Mr Meyer's contact with both Mr Vickers and Mr Sievers were not for the purposes of Mr Meyer's employment with Skytraders or for the benefit of Skytraders or in Skytraders's interests and thereby in breach of Mr Meyer's obligations to Skytraders.
The primary allegations advanced by Skytraders against Mr Meyer are that:
1. Mr Meyer disseminated Skytraders' confidential information to Mr Vickers after having given notice of resignation from his employment with Skytraders;
2. Mr Meyer obtained unauthorised access to Skytraders's confidential information on the Skytraders Dropbox Account, which access included downloading several documents from the Skytraders Dropbox Account, subsequent to his resignation from employment with Skytraders; and
3. Mr Meyer has retained a significant quantity of Skytraders's documents in a hard copy form.
In relation first to the dissemination of confidential information, the sole allegation advanced by Skytraders is that on 20 December 2019 (i.e. four days after sending notice of his resignation) Mr Meyer sent an email to Mr Vickers's personal email account, which attached Skytraders's operational manual. It is alleged that in the circumstances of Skytraders's relationship with Mr Vickers as at 20 December 2019 and Skytraders's direction to all staff on 15 September 2019 "that staff were not authorised to discuss Skytraders' operational or management matters with persons not authorised to receive such information" (see paragraph 68(b)(ii) of the Statement of Claim), Mr Meyer's email to Mr Vickers was in breach of Mr Meyer's obligations to Skytraders.
There is no dispute that Mr Meyer has many documents of Skytraders on his devices and in hard copy (not necessarily the same documents): see the affidavit of Ms White and the letters from Mr Meyer's solicitors at CB 1423-1424 and 1428-1429.
[2]
Material Non-Disclosure
The two allegations of material non-disclosure are as follows:
1. Firstly, at the ex parte hearing before Robb J on 17 March 2021, Skytraders adduced and relied upon evidence that, unbeknownst to Skytraders, Mr Meyer appeared to have created an additional, undisclosed method of access to the Skytraders Dropbox Account via his personal Gmail account. That evidence was, Mr Meyer asserts, relied upon by Skytraders in support of the proposition that there existed a probability that Mr Meyer may destroy or make unavailable material for use in these proceedings. On the material then available to it, it was incumbent upon Skytraders, Mr Meyer asserts, to disclose to the Court the following matters:
1. Mr Meyer was provided access to the Skytraders Dropbox Account by hyperlink email invitations;
2. Skytraders's records had always disclosed that Mr Meyer had access to the Skytraders Dropbox Account through his personal Gmail account; and
3. Skytraders was aware of Mr Meyer's access to the Skytraders Dropbox Account from, at the latest, February 2020: see [13(6)] above.
1. Secondly, Mr Meyer asserts that the evidence advanced by Skytraders at the ex parte hearing before Robb J "overstated" the uniqueness and level of confidentiality of the documents the subject of the proceedings. The majority of the information contained in the 14 documents presently the subject of the proceedings, on Mr Meyer's case, are publicly or commercially available and, insofar as the 14 documents contain information that is not in the public domain or otherwise commercially available, that information is of little value to anyone but Skytraders as it is unique to its business structure.
Mr Meyer asserts that Skytraders's non-disclosure of the matters set out in [36] above was material insofar as the matters complained of is evidence that he would have wanted to bring to the Court's attention and further, that the Court would have wanted to consider those matters before making the First March Orders. In making this submission, reference is made by Mr Bannon to the remarks of Ball J in Principal Financial Group Pty Limited ACN 068 318 507 v Gabriel Joseph Vella [2011] NSWSC 327, where his Honour said (at [17]):
"In order for information to be material for this purpose, I do not think it is necessary that the information would have or was likely to have made a difference to the orders of the court. It is sufficient if the information is information that it could be expected that the opposing party would have wanted to bring to the court's attention and the court would have wanted to consider before making an order. It is only if the requirement of materiality is interpreted in that way that full disclosure is an adequate substitute for a party's right to be heard."
The principles in relation to the duty of candour on the part of the applicant for ex parte orders were summarised by Rees J in Showcase Realty Pty Ltd v Nathan Circosta [2021] NSWSC 355 at [4]-[9] ("Showcase"), where her Honour said:
"4. The principles were not in dispute. On an ex parte application, the applicant has a duty of candour as described by Allsop P in Walter Rau Neusser Oel Und Fett AG v Cross Pacific Trading Ltd [2005] FCA 955 at [38]:
In an ex parte hearing, it is the obligation of the party seeking orders, through its representatives, to take the place of the absent party to the extent of bringing forward all the material facts which that party would have brought forward in defence of the application: Thomas A Edison Ltd v Bullock (1912) 15 CLR 678 at 681-82 per Isaacs J. That does not mean stating matters obliquely, including documents in voluminous exhibits, and merely not mis-stating the position. It means squarely putting the other side's case, if there is one, by coherently expressing the known facts in a way such that the Court can understand, in the urgent context in which the application is brought forward, what might be said against the making of the orders. It is not for the Court to search out, organise and bring together what can be said on the respondents' behalf. That is the responsibility of the applicant, through its representatives.
5. Where search orders have already been executed, the Court may set aside the orders ab initio if there has been a material non-disclosure: Brags Electrics Ltd v Gregory [2010] NSWSC 1205 at [17] per Brereton J. A respondent who applies to set aside an ex parte order on this basis bears the onus of showing that there has been such a non-disclosure: Brags Electrics at [10]. The test for determining whether a non-disclosure is "material" was explained by Ball J in Principal Financial Group Pty Ltd v Vella [2011] NSWSC 327 at [17] (cited with approval in Singtel Optus Pty Ltd v Almad Pty Ltd [2011] NSWSC 492 at [53] per Bergin CJ in Eq):
In order for information to be material for this purpose, I do not think it is necessary that the information would have or was likely to have made a difference to the orders of the court. It is sufficient if the information is information that it could be expected that the opposing party would have wanted to bring to the court's attention and the court would have wanted to consider before making an order. It is only if the requirement of materiality is interpreted in that way that full disclosure is an adequate substitute for a party's right to be heard.
6. In Savcor Pty Ltd v Cathodic Protection International APS (2005) 12 VR 639; [2005] VSCA 213 at [35], Gillard AJA (with whom Ormiston and Buchanan JJA agreed) described it thus, at [35]:
What is a material fact is a matter which is relevant to the court's determination. To be material, it would have to be a matter of substance in the decision making process.
At [36], his Honour adopted Brink's Mat Ltd v Elcombe [1988] 1 WLR 1350 at 1356 (per Ralph Gibson LJ), "the material facts are those which it is material for the judge to know in dealing with the application as made: materiality is to be decided by the court and not by the assessment of the applicant or his legal advisers".
7. If there has been a material non-disclosure, the Court has a general discretion whether to discharge an Anton Piller order ab initio. As to how the discretion is to be exercised, Gillard AJA explained in Savcor at [33]:
Relevant to the discretion is whether the material non-disclosure was serious or otherwise the importance or weight that should be attached to the omitted fact in the decision making process and also any hardship if the order was set aside. The approach is different if the plaintiff has acted culpably in the sense that the omission to disclose relevant matters was done deliberately to mislead the court. The most likely result in those circumstances would be that the order would be vacated.
8. Further, the question is not whether a search order would have been made, or should be made, on the evidence, but whether there has been material non-disclosure. In Savcor Gillard AJA explained at [22]:
… The order is set aside because of some irregularity and not on the merits. When this jurisdiction is enlivened, the court's function is to determine on the material that was placed before the judicial officer at first instance, whether a party has failed to discharge the obligation which rests upon any party seeking an order ex parte, namely, making a full and fair disclosure of all matters within its knowledge and which are material, to the court. The court is not concerned whether the order should have been made on the material before the court. …
See likewise Palaris Mining Pty Ltd v Short [2012] QSC 224 at [26] per Applegarth J.
9. If the Court is not minded to set the Anton Piller aside ab initio, the order will operate in futuro only; the respondent may be entitled to compensation under the usual undertaking as to damages: Brags Electrics at [17]."
Mr Meyer has the onus of establishing material non-disclosure: Showcase at [5]; Brags Electrics Pty Ltd trading as Inscope Building Technologies v Steven Mark Gregory [2010] NSWSC 1205 at [10] per Brereton J (as his Honour then was).
Mr Meyer has tendered evidence from an expert, Mr Chambers, who contends that much of what is in the documents for which Skytraders claims confidentiality is not confidential. Much of those contentions are disputed by Mr Byron, an expert retained by Skytraders: see CB 981-982.
Dealing first with the Dropbox access point, whilst I accept that Mr Colborne and Mr Calum Mackay were aware that Mr Meyer had access to some folders on the Skytraders Dropbox Account via his personal Gmail account from February 2020 and January 2021 respectively, I do not accept the proposition that either Mr Colborne or Mr Calum Mackay were aware that Mr Meyer had access to other folders on the Skytraders Dropbox Account until March 2021.
There is evidence from Ms Rey that Dropbox uses as a default address the first address given to it for an individual. If that is correct, it may well explain why, when Mr Meyer's Skytraders email was deleted on his departure from Skytraders in January 2020, Dropbox reverted to using his Gmail address. Mr Calum Mackay in cross-examination explained that he was not the administrator of Dropbox at Skytraders and had no reporting or administrative capabilities within the function of the software at that stage, although he had the capability to remove Mr Meyer's access to the relevant folder, which he did: see T44.34-44. I think it is clear that Skytraders personnel who deleted Mr Meyer's Skytraders email account from Dropbox were not aware that Mr Meyer was still able to access other folders within the Skytraders Dropbox Account because of the Dropbox default and it is not established that the relevant persons at Skytraders were aware that Mr Meyer had originally had access with his own Gmail account. If they had been aware, the strong likelihood is that they would have ensured that Mr Meyer's access to the Skytraders Dropbox Account via his Gmail account was removed at the same time that his Skytraders email account was removed. Whilst it could be said that both Mr Colborne and Mr Calum Mackay might have been wise to investigate how Mr Meyer's Gmail account was still listed, it is obvious that they did not realise that what they had observed was part of a more fundamental problem, which might be described, as Ms Rey opined, as a "conflation" issue: see CB 1104. Mr Meyer seems, on his evidence, to have been under the same misapprehension. Skytraders had a policy that access to the Skytraders Dropbox Account should only be by Skytraders's email accounts.
The statement that Mr Meyer "has somehow established an unauthorised secondary access point with his own personal Gmail email address" may be established on the final hearing of this case to be inaccurate, but I have no doubt that as at 17 March 2021, Mr Norman Makcay and Skytraders's employees believed that Mr Meyer had done so and that the fact that his personal Gmail account had been listed in respect of two folders (which links had been deleted) does not establish that his more general access through his personal Gmail address was known to anyone at Skytraders at the time of the commencement of these proceedings or that the access by this means was authorised by Skytraders.
Mr Meyer asserts that he did not appreciate they were Skytraders's documents. Again, that is a matter for a final hearing. Whilst there is evidence which supports Mr Meyer's contention that his receipt of and/or access to Skytraders's documents after his departure was not a result of his having previously established an unauthorised access, there remain questions of how it is that Mr Meyer was not just receiving but accessing, and in one case editing, what were clearly Skytraders's documents. The reports of Ms Rey and Mr Whitbourn descend into areas involving extremely technical analysis and dispute that are not appropriately resolved on an interlocutory hearing.
I am aware that Mr Meyer asserts that his access to Skytraders documents was accidental in that he asserts that when he found documents on his devices, he was not aware that they had come from Skytraders and he denies that he has been involved in tenders or potential tenders for Ambulance Victoria or that he has accessed Skytraders's documents for the purpose of a report to the Antarctic RFI. These are assertions of fact which Skytraders is not obliged to accept and they may well be the subject of vigorous contest at the hearing.
I do not think that it is established that there is material of which Skytraders was aware at the time of the application before Robb J that it failed to put before the Court or if there was that it was of such significance that the orders obtained by Skytraders should be set aside.
[3]
The Confidentiality Claim
Of the 14 documents identified by Skytraders as documents accessed by Mr Meyer, two were not claimed to be confidential (being two photographs of the landing strip in Antarctica) and two of them are documents which Skytraders accepts contain no confidential information: a manual to a Beechcraft aircraft ("the Beechcraft Manual") and a Notice to Air Crew ("NOTAC"). As Mr Chambers noted in his report, the material relied on by Skytraders does not make any assertions of confidentiality or commercial sensitivity of these documents. I think that the Beechcraft Manual was included because it was a document accessed and, on Skytraders's case, linked to the preparation of a bid or potential bid by Air Affairs. The documents are documents of Skytraders and although not confidential in the legal sense, they are documents which, contractually, Mr Meyer agreed were not to be shared with others for purposes unconnected with Skytraders's business and interests.
Of the remaining 10 documents, Mr Chambers, whilst accepting that parts of some of those documents are confidential, asserts that there is within the documents information which can be described as publicly available and hence, should not be viewed as confidential or commercially sensitive. The expert retained by Skytraders, Mr Byron, asserts that the documents are commercially sensitive or of commercial value to Skytraders's business as an aircraft operator or are, or would, likely be of commercial value to any competitor of Skytraders. In that connection, I shall give two examples. Firstly, (at CB 982-983) Mr Byron refers to the NSW Airport Performance Dataset and notes that whilst aerodrome data is publicly available from Airservices Australia, it also contains information regarding aircraft fuel load data, which, on Mr Byron's evidence, "would have taken considerable effort to compile and is not publicly available": CB 983. Secondly, (at CB 983-984) Mr Byron refers to a document styled "Safety Management System Plan", which was a document prepared, and intended for submission, for a tender response to the Victoria Police Air Wing. The purpose of the document was "to describe Skytraders processes and procedures in relation to their Safety Management System (SMS)": CB 983. On Mr Byron's evidence, "[g]iven that [the Safety Management System Plan] is a tender document and describes in detail the proposed interface between Skytraders and the [Victorian Police Air Wing] during a contract period … the document is of commercial value to Skytraders and as such, is commercially sensitive": CB 984. I note too that the document has, on almost every page, the notation "commercial-in-confidence".
As a broad principle, a confidential document does not cease to be confidential because it contains material that is publicly available. Even the collection of information and data that is not of itself confidential can be commercially valuable to the party that has invested the time and effort to assemble the information as has been recognised in the field of copyright: Morris v Ashbee (1868) LR7Eq 34 at 34-41; and see Tonnex International Pty Ltd v Dynamic Supplies Pty Ltd (2012) 99 IPR 31; [2012] FCAFC 162; and in the field of confidentiality: see Link 2 Pty Ltd v Ezystay Systems Pty Ltd [2016] NSWCA 317 at [121]-[125] per Ward JA (as her Honour then was), with whom Bathurst CJ and Leeming JA agreed. There is evidence from Skytraders as to the time spent in compiling some of the documents that contain publicly available information and evidence from Mr Byron, which supports the claim that provision of the documents to a competitor would be disadvantageous to Skytraders.
Whilst there may be scope for argument in due course about the extent to which the documents accessed by Mr Meyer are or are not confidential in the strict legal sense or as a matter appropriately so characterised pursuant to contract, Skytraders is entitled to seek to prevent dissemination of its documents and, a fortiori, because they have, or may have, value to a competitor. I am not persuaded that Skytraders has in the material presented to the Court misstated the nature or content of the documents. Even though strictly, the Beechcraft Manual and the NOTAC should not have been included in the confidential exhibit, they were exhibited and their nature was clear. There was no misdescription of the documents or their contents in the affidavits. By his comment to the Court, extracted at [16(2)] above, that Mr Meyer had gained access "to various confidential documents", Mr Zahra may have implied that all of the documents (other than the photographs) were confidential and was, therefore, to that extent inaccurate, but in the overall context, I do not view that as of any real significance.
I am not satisfied that the orders made by Robb J should be discharged.
[4]
The Mapping Exercise and the Status Quo
What next falls to be determined is what is to happen with the documents seized and/or imaged by the independent computer experts. As I have mentioned, Skytraders seeks orders facilitating what has been described as a mapping analysis of the seized and/or imaged documents and information, and thereafter for orders that the independent computer experts prepare a report to the independent solicitors detailing the results of that analysis, but without disclosing the contents of specific documents ("the Mapping Report"). Ancillary orders are also sought setting a timetable by which the parties are to gain access to the Mapping Report and detailing the manner by which any dispute as to the parties' access to the Mapping Report is to be resolved. The orders sought by Skytraders would grant first access to the Mapping Report to Mr Meyer. Mr Meyer would also be granted an opportunity to, if necessary, object to Skytraders's access to the Mapping Report on the basis of a claim for privilege, confidentiality or for some other like reason.
Mr Meyer resists that application. Mr Meyer asserts that any process of document analysis should occur in the ordinary course; that is, by way of discovery at an appropriate time in the proceedings.
Thus, the sole remaining contest between the parties on this issue is whether Skytraders should be permitted, at this early stage in the proceedings, to commence a process of what could, but will not necessarily, culminate in its inspection (by its solicitors at least) of the seized material. Such a process, Mr Meyer submits, it tantamount to discovery and should not be permitted. Mr Bannon relies upon the following passage from Branson J's judgment in Microsoft Corp at [26] in support of his submission that Skytraders should not be permitted to conduct discovery of the documents and information seized and/or imaged pursuant to the First March Orders:
"The court must, in my view, be careful to avoid the extraordinary jurisdiction of the court to make an Anton Piller order from being subverted to a mere investigatory tool for applicants or indeed, from being used for any purpose other than the preservation of vital evidence pending the hearing and determination of a proceeding."
See also Lamond (No 4) [2017] FCA 820 at [20] per Besanko J and Long v Specifier Publications Pty Ltd (1998) 44 NSWLR 545 at 547 per Powell JA (with whom Meagher and Handley JJA agreed).
Mr Bannon also makes reference to what was said by Ward CJ in Eq in Findex Group v iiNet Ltd [2018] NSWSC 1567 at [124] ("Findex"), that:
"… it is not a purpose or object of search order provisions to permit a plaintiff who believes that there has been an vindictive campaign made against it, him or her, the luxury of trawling through a mass of documentation that would not otherwise have been available to it, him or her at this stage, whether that be to see what else was said about it, him or her that might be defamatory or might otherwise support some other potential cause of action."
a decision upheld on appeal: see Findex CA, particularly at [26].
In Metso (No 3), upon which Skytraders relies, Flick J relevantly said (at [28]):
… the discretion to allow an applicant to inspect seized documents may be exercised to permit:
(a) an assessment to be made as to whether or not there has been compliance with the order as made and (possibly) whether any further order pursuant to O 25B may be warranted;
(b) the identification and separation from the entirety of those documents that were in fact seized, those documents which do or may provide evidence pending the hearing and determination of a proceeding; and
(c) the identification and separation from the entirety of those documents that were in fact seized, those documents which do not provide such evidence so that those documents may be returned.
And, in identifying those documents which should be preserved pending the final hearing and determination of a proceeding:
(d) the search is not limited to those documents directly related to the precise cause of action then known: cf Aristocrat Technologies Australia Pty Ltd v Global Gaming Pty Ltd [2006] FCA 862 at [6]-[7] per Allsop J; Aristocrat Technologies Australia Pty Ltd v Global Gaming Supplies Pty Ltd [2006] FCA 1707 at [4] per Jacobson J.
There may well be other reasons for granting leave to an applicant to inspect seized documents. All of the purposes identified, however, have one thing in common - they allow the documents which have been seized to be inspected in order to ensure that the search order has been complied with and to ensure that only evidence which should be preserved is in fact preserved pending the final determination of a proceeding.
In Metso Minerals (Australia) Ltd v Kalra [2009] FCAFC 57, which concerned an unsuccessful application for leave to appeal from a later judgment of Flick J in the same proceedings, Emmett J (as his Honour then was) recognised the tension between granting access to seized material, which is tantamount to discovery or preliminary discovery, and giving effect to what is the unavoidable conclusion that the preserved evidence will or ought to be made available to the party who required its seizure; otherwise, there would be little purpose for a search order in the first instance. Stewart J similarly acknowledged this tension in Rauland Australia Pty Ltd v Johnson (No 2) [2019] FCA 1175, where, at [48] and [55], his Honour said:
"48. The fact that a search order preserves evidence for use in a proceeding in due course bears with it the unavoidable implication that there are circumstances in which the preserved evidence will be made available to a party requiring it in order to then make it available in the proceeding; were it otherwise, there would be no purpose to making search orders. It is therefore not the case that a search order will only serve the purpose of preserving evidence, always insulating that evidence from use in the subsequent proceeding. If the evidence is not otherwise produced in the proceeding, there will be a need to access that which was preserved so that it can be adduced in the proceeding. There may also be a need to access what was preserved in order to ascertain whether what has been produced pursuant to, say, discovery procedures is all that had to be produced. But none of that means that access will necessarily be granted at a stage prior to discovery.
…
55. It is apparent from the above authorities that the Court has a discretion to order access to documents that have been preserved under a seizure order. In the case of access to the seized material for the purpose of formulating a claim, or as an aid to discovery, or to particularise a claim, that discretion may be exercised only in narrow circumstances. However, where parties have already furnished discovery and questions arise as to the adequacy of discovery or discovery has not produced the seized material (which is otherwise assumed to be relevant and not subject to a valid objection to production such as privilege), the discretion might be more readily exercised."
I do not think that the circumstances of Findex are similar or analogous to those here. It will be observed that what Skytraders seeks falls squarely within categories (b) and (c) identified by Flick J at [28] of Metso (No 3). In my view, that is a sufficient basis to permit the mapping process to be carried out. Mr Bannon made the point that there may be thousands of pages of documents held by Mr Meyer which emanated from Skytraders and which will never be used or useful to Mr Meyer or Air Affairs and that the requirement that Mr Meyer return documents is likely to have no commercial impact whatsoever. That may well prove to be so, but there is a reasonable prospect that Skytraders's mapping proposal will have the beneficial effect of reducing the time and expense which will need to be spent on interrogation of the documents, should Skytraders seek and obtain permission for that to occur in due course. A further point is that Skytraders wants to know what use Mr Meyer has made of any of their documents and, in my view, in the circumstances revealed by the evidence so far, they are entitled to know. This is not a case where access to documents is sought by a plaintiff as a "fishing" expedition to see whether it can mount a case against a defendant; it is a case about documents of Skytraders some of which, it is clear, have been retained by Mr Meyer and some of which have been accessed by Mr Meyer whilst employed by Air Affairs. Whether that access was innocent, as Mr Meyer claims, is yet to be determined, as is the related question of the use, if any, made by Mr Meyer of those documents.
I have referred to Mr Bannon's expressed concern as to the prospective costs of the litigation. There may turn out to be a real question as to whether Mr Meyer's access to Skytraders's documents since his departure has been productive of any loss or damage to Skytraders. Mr Hutley pointed out that Skytraders is concerned that at the moment, it does not know what use Mr Meyer has made of the documents he is known to have accessed, nor the extent of his access to, and use of, other documents. I encouraged the legal representatives of the parties to discuss these issues so that extensive and possibly unfruitful litigation could be avoided and agreed to delay handing down any judgment on the matter before me for a short period against the possibility of resolution of the matter; an outcome which, however, was not achieved.
[5]
Conclusion
The orders sought by the Plaintiff, modified to take into account the passage of time since they were formulated, should be made. The First Defendant's Motion should be dismissed, with an order that the First Defendant pay the Plaintiff's costs of the Motion and of the Plaintiff's application.
I order that:
1. The First Defendant's Notice of Motion filed on 20 October 2021 be dismissed.
2. The Independent Computer Experts identified in the orders of Robb J on 17 March 2021 are to:
1. undertake a data overview (mapping) analysis in respect of the Search Devices identified in the schedule annexed to these orders and marked "A" so as to identify in respect of each of those devices:
1. a list of folders together with associated data volumes and, if possible, date ranges;
2. a list of data types together with associated data volumes and, if possible, date ranges;
3. a list of any Dropbox folders together with associated data volume and, if possible, date ranges;
1. prepare a report detailing the results of the mapping analysis undertaken with respect to each of the Search Devices but not disclosing the contents of any specific documents ("Mapping Report"); and
2. provide the Mapping Report to the independent solicitor, Neil Wallman of HWL Ebsworth ("Independent Solicitor"), on or before 31 January 2022.
1. The First Defendant be granted first access to the Mapping Report on or before 5:00pm on 7 February 2022.
2. If the First Defendant objects to the Plaintiff having access to the Mapping Report or any part of it, he is to notify the Independent Solicitor of the objection by 5:00pm on 14 February 2022.
3. In the absence of any objection by the First Defendant, the Independent Solicitor is to provide a copy of the Mapping Report to the Plaintiff by 5:00pm on 15 February 2022.
4. In the event that the First Defendant objects to the Plaintiff having access to the Mapping Report (or any parts of it) on the basis of a claim for privilege, confidentiality or for some other reason, the First Defendant is to file and serve an affidavit before 5:00pm on 14 February 2022 setting out:
1. each part of the Mapping Report that is the subject of such objection; and
2. the basis of each objection, together with a brief explanation in support of it.
1. The First Defendant pay the Plaintiff's costs of the First Defendant's Motion and of the Plaintiff's application.
2. The proceedings be listed for directions before the Registrar in Equity on 21 February 2022.
[6]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 01 February 2022