FEDERAL COURT OF AUSTRALIA

Cadbury Pty Ltd v Amcor Limited (No 2) [2009] FCA 663

CADBURY PTY LTD (ACN 004 551 473) v AMCOR LIMITED (ABN 62 000 017 372) and AMCOR PACKAGING (AUSTRALIA) PTY LTD (ABN 55 004 275 165); VISY BOARD PTY LTD (ACN 005 787 913), VISY INDUSTRIES HOLDINGS PTY LTD (ACN 005 787 968) and VISY INDUSTRIES (AUSTRALIA) PTY LTD (ACN 004 337 615)

VID 1377 of 2006

GORDON J

19 JUNE 2009

MELBOURNE

THE COURT ORDERS THAT:

1.         By 4:00pm on 24 June 2009, the parties file minutes of orders to give effect to these reasons for decision.

2.         The costs relating to the issues the subject of these reasons for decision be costs in the cause.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

REASONS FOR JUDGMENT

INTRODUCTION

1                          The background to these proceedings has been described earlier:  see Cadbury Schweppes Pty Ltd v Amcor Limited [2009] FCA 442.

2                          The respondents (“Amcor”) produce corrugated fibreboard packaging (CFP).  CFP is used by Cadbury in its confectionery business.  Cadbury also had a beverage business but it was sold in April 2009.  Amcor has sought orders that limit the persons within Cadbury to whom particular categories of documents may be disclosed.

3                          Annexure A is a list of the documents in dispute.  There were three categories in dispute.  One category in dispute has been resolved, namely the documents numbered 1 - 3, 7, 9 - 11, 14, 23, 28, 31, 35, 37 - 39, 41 and 43.  After debate and argument in Court and despite being offered the opportunity to make submissions on whether any other order should be made with regard to that category of documents, Amcor has failed to avail itself of that opportunity.  Accordingly, Amcor must now be taken to accept that the documents in that category can be disclosed to Cadbury, subject of course to the implied undertaking known as the Harman principle:  see Harman v Secretary of State for the Home Department [1983] 1 AC 280.  As the last column in Annexure A records in relation to those documents, the “Parties accept that production is subject to the Harman undertaking and no order required”. 

4                          That leaves two categories of documents in dispute, namely:

1.         documents containing information on the period 1 January 2007 to present, that if disclosed to those within Cadbury negotiating a CFP contract with Amcor would give Cadbury an advantage in its current negotiations with Amcor for the supply of CFP for use in Cadbury’s confectionery business (“the CFP financial information”); and

2.         documents containing commercially sensitive information relating to Amcor’s cans business (“Cans information”).

Cadbury objects to such orders.

THE PARTIES’ PRESENTATION OF THE RELEVANT MATERIAL

5                          I should say something about the manner in which both parties presented these issues for determination in their filed submissions and at the hearing.  In my view, neither party gave appropriate consideration to what each was required to do to support (in the case of Amcor) or challenge (in the case of Cadbury), Amcor’s claims for confidentiality.  General statements or mere assertions by either party (as occurred in this application) are inevitably not sufficient.  As the analysis of the legal principles will demonstrate (see [6] to [7] below), the source and contents of each document are important and the “balance” struck by a Court may well change as circumstances change during the course of preparation for trial and ultimately the trial itself.  Neither party appeared to have turned, or was willing to turn, their mind to these matters in any sufficient detail.  Why that was so I was unable to ascertain.  In any event, I was left to determine and have determined the claims based on the affidavit material and submissions filed by the parties.

LEGAL PRINCIPLES

6                          Before turning to consider each category, it is appropriate to restate the legal principles to be applied in resolving this dispute.  They may be summarised as follows (see e.g. Mobil Oil Australia Ltd v Guina Developments Pty Ltd [1996] 2 VR 34 at 38-40):

1.         A party is ordinarily entitled to discovery and inspection of all discoverable documents in the possession or control of the opposite party, subject to a number of important limits including:

(a)        valid claims for privilege from production; and

(b)        the principle that a party may not use discovered documents except for the purpose of the action in which the discovery was made (“the implied undertaking”);

2.         If the discoverable documents in the possession or control of a party are confidential, that fact will not ordinarily be a sufficient reason to deny inspection by the opposite party.  The limit identified in 1(b) usually will provide sufficient protection to the party producing the documents;

3.         However, if the relevant parties are trade rivals whose secrets would be revealed by discovery and inspection, other considerations apply:

(a)        a fair balance must be struck between the needs of the party wishing to litigate (here, Cadbury) and the legitimate concern of a trade rival to retain the secrecy of its commercially sensitive information (here, Amcor).  That balance may need to be reviewed as the matter progresses to trial or at the trial itself;

(b)        as each case falls for determination according to its own facts, it is only upon consideration, by inspection of the nature and content, of the documents that a decision can be made about what orders should be granted for inspection by or on behalf of a party (here, Cadbury).   

7                          For the Court to perform the evaluation as outlined in [6(3)], the party seeking an order that limits the inspection of discoverable documents must establish that the character of each document is such that it should attract protection additional to that granted by the implied undertaking:  see Mobil [1996] 2 VR 34 at 38-40; Mackay Sugar Co-Operative Association Ltd v CSR Ltd (1996) 63 FCR 408 at 415; BT Australia Pty Ltd v New South Wales (No 6) [1998] FCA 293 at 7-11; Index Group of Companies Pty Ltd v Nolan [2002] FCA 608 at [8]; ACCC v Baxter Healthcare Pty Ltd [2003] FCA 994 at [24].  As was accepted by the parties, in assessing whether any document should attract the additional protection, there are a number of matters which may be relevant including, without limitation, the age of the information, the identity of the persons who will inspect the documents and the reason or reasons why the inspection of particular documents is necessary.  As I have said earlier, the circumstances may change as preparation for trial progresses.

8                          With those principles in mind, I turn to consider the two general categories of documents by reference to the specific documents in dispute.  They are listed in Annexure A.

A.        CFP FINANCIAL INFORMATION RELEVANT TO CURRENT NEGOTIATIONS

9                          The CFP financial information is described above:  see [4(1)].  It is concerned with costs, margins and pricing. 

10                        The dispute between the parties concerns CFP financial information for the period 1 January 2007 to 30 June 2007.  Cadbury accepts that CFP financial information relating to the 2008 financial year (1 July 2007 to 30 June 2008) and later is confidential and inspection of that information is to be limited to Cadbury’s external and internal legal advisers and Cadbury’s experts (defined by Amcor as “Cadbury Instructors”).  However, Cadbury contends that the CFP financial information for the 2007 financial year and earlier is not confidential and, even if it is confidential, the “special protection” orders sought by Amcor do not strike a fair balance.  In particular, Cadbury seeks disclosure of the CFP financial information for the 2008 financial year (that is, all information for which “special protection” is sought) and earlier to Mr Banati and Mr Christopherson in addition to the Cadbury Instructors.

11                        For my part, I have extended the term “Cadbury Instructors” to include Mr Amit Banati (“Mr Banati”).  That conclusion requires some explanation.  As Hayne J said in Mobil [1996] 2 VR 34 at 41, the issue of confidentiality needs revisiting as preparation for trial progresses.  Two events occurred in the preparation of these proceedings for trial that necessitated the parties and the Court to revisit Amcor’s confidentiality claims in relation to the CFP financial information for the 2008 financial year and earlier – a mediation held on 10 June 2009 and preparation by Cadbury of some of its evidence for trial.  In relation to the first, the mediation, Cadbury’s contention was that it “was critical” that Mr Banati, President, Pacific Business Unit of Cadbury PLC, with responsibility for Cadbury’s operations in Australia, New Zealand and Japan, inspect the CFP financial information for the 2008 financial year and earlier.  During the course of the hearing concerning the confidentiality of the documents, a solution was reached by agreement between Amcor and Cadbury - namely that on Mr Banati having access to the CFP financial information for the 2008 financial year and earlier and attending the mediation, Mr Banati would not outside the mediation participate in the approval or non-approval process of any contract between Cadbury and Amcor or relevant subsidiaries arising out of the current negotiations for a contract for the supply of CFP.  Instead, Mr Banati would delegate that approval process.  In my view, disclosure to Mr Banati on those terms necessarily results in Mr Banati needing to be included as one of the Cadbury Instructors and being entitled to inspect the CFP financial information for the 2008 financial year and earlier for the purposes of preparation for trial.

12                        Against that background, I now turn to consider each of the documents comprising the CFP financial information for the 2007 financial year and earlier.

Professor Jerry Hausman – Documents 4-6 of Annexure A

13                        The three documents concern figures in each of the paragraphs numbered [61], [62] and [83] of Professor Jerry Hausman’s expert report.  The figures in paragraph [83] also appear in paragraphs [61] and [62].  The figures state Amcor’s gross margin and overall margin in “2007”.  Tables 6b, 6c and 6d attached to the report contain the underlying data for those figures.  It was not clear whether the figures were for the 2007 calendar year or the 2007 financial year.  On the face of it, the figures appear to be for the 2007 calendar year.  On that basis, counsel for Cadbury accepted that inspection of these figures should be limited to Cadbury Instructors (including Mr Banati). 

Professor George Hay – Document 8 of Annexure A

14                        The figures in dispute list the tonnes, sales, net sales, direct and distribution costs, full costs, contribution to fixed costs and profits after April 2005, by calendar year, for Amcor’s supply of confectionery CFP to Cadbury.  They are set out in a chart prepared by Professor Hay. 

15                        Initially, the figures for the 2007 calendar year and the first six months of 2008 in relation to direct and distribution costs, full costs, contribution to fixed costs and profits were in dispute.  None of the figures for tonnes, sales or net sales were said by Amcor to be subject to special protection.  That is not surprising – that is information Cadbury would already possess as it is concerned with sales by Amcor to Cadbury.

16                        Counsel for Cadbury accepts that inspection of the figures for the 2007 calendar year and the first six months of 2008 relating to direct and distribution costs, full costs, contribution to fixed costs and profits should be limited to Cadbury Instructors (including Mr Banati).  The only other figure in dispute was the “Overall” figure in relation to direct and distribution costs, full costs, contribution to fixed costs and profit.  Amcor submitted that if the “Overall” figure for each of these items was disclosed then Cadbury would be able to reverse engineer an average figure for the 2007 calendar year and the first six months of 2008.  I accept that submission.  Inspection of the “Overall” figure in relation to direct and distribution costs, full costs, contribution to fixed costs and profit should be limited to the Cadbury Instructors (including Mr Banati).

Facts and Assumptions – Not Listed on Annexure A

17                        Amcor’s solicitors prepared a document entitled “Facts and Assumptions” which it provided to both Professors Hausman and Hay.  Amcor contended that parts of two tables in paragraph [37] of that document dealing with “Kraft paper” and “recycled paper” contained CFP financial information entitled to special protection.  Those tables are described in the Facts and Assumptions in the following terms:

…

Please assume that the adjustment to be made to the paper costs (on a per tonne basis) for the financial years 1999/00 until 2007/08 in order to exclude, among other things, the handling fee and margin are set out in the table below.  These figures have also been adjusted to take account of the capital charge in respect of the average funds employed in the paper division.

For Kraft paper and recycled paper, figures for the financial years 1999/00 until 2007/08 are then provided. 

18                        There is no dispute about the figures for the financial years 1999/00 until 2005/2006.  They are disclosed subject to the Harman undertaking.  Cadbury does not challenge Amcor’s claim for confidentiality in relation to the 2007/08 figure.  (That figure should be disclosed to the Cadbury Instructors (including Mr Banati).  However, it does challenge Amcor’s claim in relation to the figures for 2006/2007.  The issue is the currency of the information in the context of the current negotiations between Cadbury and Amcor over the CFP contract.

19                        Mr Ward, the current General Manager, Strategy and Business Improvement with Amcor Fibre Packaging Australasia described the currency of information in the following terms:

It is difficult to identify with precision a date at which customer pricing, cost and margin information maintained by Amcor becomes so old as to no longer be a concern from the perspective of the issues raised above.  For instance, if a customer’s pricing has not changed for a significant period, that pricing which was entered into some time ago remains current.  Given that difficulty, it is in my view appropriate that information post 1 January 2007 in relation to pricing, cost and margin would represent a reasonable date by which to delineate currently relevant information from information which may no longer be currently relevant.  Information after that date bears an increased risk of being used to identify or estimate with a reasonable degree of accuracy current prices, costs or margins.

Providing information as to Cadbury’s margins prior to the current tender may permit Cadbury to identify by comparison the margins in relation to the current proposal.  Accordingly, I am concerned to restrict the access to that information.

(Emphasis added).

20                        Mr Ward addressed the nature and contents of the CFP financial information separately.  In relation to the costs of individual inputs relating to the manufacture of CFP, Mr Ward’s evidence was as follows:

While costs of individual inputs relating to the manufacture of CFP are not of their own particularly commercially sensitive or confidential, if Cadbury was to obtain a full picture of these costs it could, by reference to its known prices, ascertain Amcor’s margin of profit.  The cost of paper accounts for around 50% of Amcor’s total cost of producing CFP.  Given its importance to the total cost of manufacturing CFP, I am concerned to ensure that customers are not made aware of the internal margin component associated with the paper used to produce CFP.  I believe that there would be a significant risk if that margin was made known to Cadbury or another customer that they would seek to bargain away a component of that margin.

21                        In my view, having considered the views expressed by Mr Ward, inspection of the figures for the 2007 financial year should not be limited in the manner contended for by Amcor.  First, the figures in the chart are an assumption.  Secondly, the assumed adjustment is an adjustment to paper costs to exclude, among other things, a handling fee and margin.  In fact, the paper costs are set out in spreadsheets attached to the statement of Jon Rowell, an expert, who apparently analysed the costs involved in supplying CFP to Cadbury for its confectionery, beverage and Pepsi businesses.  Finally, as the figures for the preceding years indicate, there is no general trend.  I do not accept that the figures for the 2007 financial year have any currency in the context of the current negotiations between Cadbury and Amcor over the CFP contract.  The figures should be disclosed subject to the Harman undertaking. 

Phillips – Documents 24 and 25 of Annexure A

22                        The parties agreed that I would resolve the confidentiality claims in relation to the Phillips documents by reference to samples.  I will direct that the samples be placed in an envelope marked “Phillips Samples for the purposes of paragraph [22] of [2009] FCA 663”, marked “Confidential” and with a note that the envelope is not to be opened except by order of the Court. 

23                        Amcor described the source and contents of these examples (comprising thirty three (33) pages) in the following terms:

There are two exhibits to Mr Phillips’ statements.  Each exhibit is a compact disc containing a number of Microsoft Excel files.  The files contain financial information extracted by Mr Phillips from Amcor’s records. …

There are a large number of files contained on the exhibits to Mr Phillips’ statements.  … Each file typically contains a number [of] different worksheets.  The parties have agreed that the only practical way for the Court to resolve the dispute is by consideration of a sample.  The sample chosen is:

(a)        E.227.003.0217_0001.xls;

(b)        E.227.003.0208_0001.xls;

(c)        E.227.003.0210_0001.xls;

(d)        E.227.003.0171_0001.xls;

(e)        E.227.003.0222_0001.xls;

24                        Consistent with Amcor’s approach in relation to the other documents in dispute, Amcor shaded in grey the information on the pages for which Amcor sought a special protection order.  In particular, Amcor sought an order that the shaded information be disclosed to Cadbury Instructors (including Mr Banati).  Cadbury’s position was that such an order should be made only in respect of CFP financial information for the 2008 financial year.  In relation to the balance of the information, Cadbury submitted that given the volume of the material, it was unlikely that any Cadbury employee would recall any of the CFP financial information, accidental disclosure was therefore unlikely, and finally that understanding and manipulating the CFP financial information may be important in the proceeding.  The last submission was never properly developed by Cadbury. 

25                        Document E.227.003.0217_0001.xls – Pages 2-6 of the Bundle.  The 2007 financial year worksheet is in dispute.  Consistent with the views earlier expressed, I do not consider that the 2007 financial year worksheets should be subject to a special protection order.  As the evidence of Mr Ward makes clear (see [19] above), the selection of 1 January 2007 is arbitrary.  Moreover, it is an unusual choice – Amcor operated under July to June financial years.  Selecting a cut-off date of 1 January 2007 in reality meant that information for the whole of the 2007 financial year must be subject to a special protection order.  That information is now at least two to three years old. 

26                        Amcor submitted there were a number of factors that would justify a special protection order in relation to the 2007 worksheet.  In general terms, Amcor submitted that the worksheet disclosed information about Amcor’s prices, cost and margins of the sale of CFP by Amcor to its customers and that information was confidential.  As noted earlier, the worksheet for the 2006 financial year is not subject to a special protection order.  Given the age of the information, the contents of the worksheets for 2006 and 2007 and the arbitrary selection of 1 January 2007 by Amcor, I consider the 2007 worksheet should be disclosed subject to the Harman undertaking.

27                        Document E.227.003.0208_0001.xls – Pages 8 -12 of the Bundle.  For the reasons set out in [25] and [26] above, I consider the 2007 worksheet should be disclosed subject to the Harman undertaking.  The 2008 worksheet should be disclosed to the Cadbury Instructors (including Mr Banati).

28                        Document E.227.003.0210_0001.xls – Pages 14 – 19 of the Bundle.  For the reasons set out in [25] and [26] above, I consider the 2006 and 2007 worksheets should be disclosed subject to the Harman undertaking.  Contrary to Amcor’s contention, I do not accept that there was no dispute about the separate pages relating to the period January to June 2007.  The concession made by Cadbury during the course of the hearing was that “as far as [Amcor] seeks special protection for the [CFP] financial information, being margin, cost or price information which is set out in a document which covers a [calendar] period commencing 1 January 2007, Cadbury does not seek to challenge that”.  However, Cadbury continued to object to special protection orders for “material that cover[ed] the financial year – the 2007 financial year”.

29                        Document E.227.003.0171_0001.xls – Pages 21 - 24 of the Bundle.  I do not understand there to be any dispute about a special protection order for the 2008 financial year.  Disclosure of those sheets should be limited to the Cadbury Instructors (including Mr Banati).  The sheets for the earlier financial years should be disclosed subject to the Harman undertaking for the reasons set out above:  see [25] and [26].

30                        Document E.227.003.0222_0001.xls – Pages 26 - 33 of the Bundle.  I do not understand there to be any dispute about a special protection order for the 2008 financial year.  Disclosure of those sheets should be limited to the Cadbury Instructors (including Mr Banati).  The sheets for the earlier financial years should be disclosed subject to the Harman undertaking for the reasons set out above:  see [25] and [26].

Potter – Documents 27 and 29 of Annexure A

31                        Document 27 in fact comprises parts of paragraphs in the Potter Report:

(1)                    Paragraph 10.14.2 – this should be disclosed subject to the Harman undertaking.  It is an adjustment made by Mr Potter for the reasons disclosed in his Report.  The need for and accuracy of the adjustment is an issue to be resolved at trial.

(2)                    Part of Table 10 in paragraph 10.22 – these figures are not adjustments made by Mr Potter but are what was referred to throughout the course of the hearing as “actuals”.  There is no dispute that disclosure of the second last column should be limited to Cadbury Instructors (including Mr Banati).  The issue concerns disclosure of the figures for the 2007 financial year and the average figures.  On any view, disclosure of the column headed “total average” should be limited to Cadbury Instructors (including Mr Banati) because with the data in that column it would be possible to reverse engineer the figures or at least a good estimate of the figures for 2008.  I do not consider that the figures in relation to the 2007 financial year should be subject to a special protection order.  They should be disclosed subject to the Harman undertaking.  That view is confirmed by the opening line in paragraph 10.23. 

(3)                    Part of Table 11 in paragraph 10.29 - these figures are adjustments made by Mr Potter.  There is no dispute that disclosure of the last column should be limited to Cadbury Instructors (including Mr Banati).  I do not consider that the figures in relation to the 2007 financial year should be subject to a special protection order and they should be disclosed subject to the Harman undertaking.  They are adjustments and the substance of the figures is disclosed in the narrative in the Report for which no special protection order is sought.

(4)                    Part of Table 12 in paragraph 10.36 – these figures are actuals extracted from Amcor profit and loss reports.  There is no dispute that disclosure of the last column should be limited to Cadbury Instructors (including Mr Banati).  I do not consider that the figures in relation to the 2007 financial year should be subject to a special protection order.  They should be disclosed subject to the Harman undertaking.  Paragraphs 10.37 - 10.41 of the Potter Report (not subject to a claim for a special protection order) explain in detail why the description of “fixed costs” is not entirely accurate.  Moreover, I have no evidence as to whether the sources for this data - Amcor’s profit and loss reports – are not publicly available. 

(5)                    Paragraph 10.42 – I do not consider that this paragraph should be subject to a special protection order.  It is based on data for the financial years prior to 30 June 2006.  It sets out an assumption Mr Potter has made for the purposes of his Report for the 2006, 2007 and 2008 years using data for previous years which, on any view, is not current.  It should be disclosed subject to the Harman undertaking.

(6)                    Part of Table 13 in paragraph 10.45 and Part of Table 14 in paragraph 10.46 – these figures are estimates by Mr Potter.  There is no dispute that disclosure of the last column should be limited to Cadbury Instructors (including Mr Banati).  I do not consider that the figures in relation to the 2007 financial year should be subject to a special protection order and they should be disclosed subject to the Harman undertaking.  They are estimates by Mr Potter. 

(7)                    Part of Table 22 in paragraph 12.22, part of Table 23 in paragraph 12.24 and part of Tables 24 and 25 in paragraph 12.28 – these figures are based on actuals.  There is no dispute that disclosure of the 2008 financial year column in each chart should be limited to Cadbury Instructors (including Mr Banati).  I do not consider that the figures in relation to the 2007 financial year should be subject to a special protection order and they should be disclosed subject to the Harman undertaking.  The surrounding paragraphs (for which no special protection order is sought) describe in detail what the charts illustrate.  In relation to Tables 24 and 25, I would limit disclosure of the column headed “Total” to the Cadbury Instructors (including Mr Banati). 

(8)                    Parts of paragraphs 12.31-12.36 (inclusive) – these paragraphs deal with “Cost Recovery Trends”. 

·                Paragraph 12.31 - disclosure should be limited to Cadbury Instructors (including Mr Banati).  Although it deals with the 2007 and 2008 financial years, the information is inextricably linked.

·                Paragraph 12.32 (1^st sentence) – that sentence should be disclosed subject to the Harman undertaking.  It concerns the 2007 financial year in respect of the beverage business, a business in which Cadbury no longer participates.

·                Paragraph 12.32 (2^nd sentence) - Cadbury does not challenge Amcor’s claim.  There is no dispute that disclosure should be limited to Cadbury Instructors (including Mr Banati).

·                Paragraph 12.33 - this should be disclosed subject to the Harman undertaking.  It concerns the beverage business in which Cadbury no longer participates.

·                Paragraph 12.34 (2^nd last sentence) - Amcor no longer seeks a special protection order.  That sentence should be disclosed subject to the Harman undertaking.

·                Paragraph 12.34 (last sentence) - Cadbury does not challenge Amcor’s claim.  There is no dispute that disclosure should be limited to Cadbury Instructors (including Mr Banati).

·                Paragraph 12.35 - disclosure should be limited to Cadbury Instructors (including Mr Banati).  Although it deals with the 2007 and 2008 financial years, the information is inextricably linked.

·                Paragraph 12.36 (2^nd last sentence) - disclosure should be limited to Cadbury Instructors (including Mr Banati).  Although it deals with a number of financial years, the information is inextricably linked and the 2008 CFP financial information cannot be extracted.

·                Paragraph 12.36 (last sentence) - that sentence should be disclosed subject to the Harman undertaking.  It concerns the beverage business in which Cadbury no longer participates.

(9)                    Part of paragraph 13.26 – I do not consider that this paragraph should be subject to a special protection order.  Although it concerns the 2007 and 2008 financial years, the surrounding paragraphs (for which no special protection order was sought) deal with the same issue for the same financial periods.  Amcor’s treatment is, on any view, inconsistent.  It should be disclosed subject to the Harman undertaking. 

32                        Document 29 in fact comprises parts of a number of Annexures: 5, 9, 10, 11, 12,
14 - 30, 34, 35-39 to the Potter Report. 

            (1)        To the extent that these Annexures deal with 2008 financial year information, Cadbury does not challenge Amcor’s claim and there is no dispute that disclosure should be limited to Cadbury Instructors (including Mr Banati).

            (2)        Annexure 5 – Column L should be disclosed subject to the Harman undertaking.  Much of the data was obtained from public sources, it concerns the 2007 financial year and it does not establish nor suggest a trend.

            (3)        Annexure 9 – Those columns or rows should be disclosed subject to the Harman undertaking.  They concern Cans information: see Section B below.

            (4)        Annexure 10 – It should be disclosed subject to the Harman undertaking.  It concerns Cans information: see Section B below. 

            (5)        Annexure 11 - Those rows concerned with the 2007 financial year should be disclosed subject to the Harman undertaking.  Disclosure of the rows headed “Total” or “Grand Total” should be limited to the Cadbury Instructors (including Mr Banati) because their contents would enable the figures for the 2008 financial year to be determined.  Finally, it should be noted that Cadbury accepts that disclosure of the small number of rows or columns dealing with the 2007 calendar year (e.g. page 54) and all of the rows or columns dealing with the 2008 calendar year should be limited to the Cadbury Instructors (including Mr Banati): see [28] above.  Any information relating to earlier years (e.g. Dec 06 on page 54) should be disclosed subject to the Harman undertaking. 

            (6)        Annexures 12, 14-23, 25-30, 34, 36-39 - The 2007 financial year information should be disclosed subject to the Harman undertaking.  For the avoidance of doubt, in relation to the line charts, a line should be drawn up through the chart as at 30 June 2007 (i.e. down through the mark and not at the end of the 2007 calendar year).  This will mean that no indication is given of the movement in the 2008 financial year.  Finally, as with the material outlined in [32(5)] above, where the information deals with the 2007 calendar year (e.g. page 114), its disclosure should be limited to the Cadbury Instructors (including Mr Banati). 

            (7)        Annexures 24 and 35 - those rows and columns concerned with the 2007 financial year should be disclosed subject to the Harman undertaking.  Disclosure of the columns headed “Grand Total” and “Total Average” should be limited to the Cadbury Instructors (including Mr Banati) because their contents would enable the figures for the 2008 financial year to be determined. 

Roberts – Documents 32-34 of Annexure A

33                        These documents were produced initially for inspection by Amcor without any claim for special protection orders.  However, Cadbury informed the Court that at the time of the hearing it had limited disclosure of the documents to the Cadbury Instructors (not including Mr Banati).  Following the hearing, Cadbury asserted that the relevant documents “[had] been used”, without explaining the statement.  To whom these documents may have been shown and the consequential impact of such disclosure I am not able to address.  If it becomes apparent that, in fact, the documents have been disclosed to anyone external to the Cadbury Instructors (noting that Mr Banati has now also had access for the purposes of the mediation:  see [11] above), then resolution of that issue can be the subject of further orders once the parties have considered these reasons for decision.

34                        Document 32 is dated 8 February 2008.  Part of its title reads “Botany B9 Paper Machine”.  It is a memorandum to the Board of Amcor Limited and it is marked Confidential.  Amcor seeks special protection orders over limited parts of the document.  First, on page 3, Amcor seeks special protection orders for its February 2008 recycled paper costs.  In my view, that figure should only be disclosed to the Cadbury Instructors (including Mr Banati).

35                        Secondly, on page 4, it seeks protection over a figure addressing its production costs.  This figure is no longer in dispute.  Cadbury accepts that this figure should only be disclosed to the Cadbury Instructors (including Mr Banati).

36                        The third figure in dispute is on page 6.  It forms a limited part of the financial summary of the project costs, proposed funding and profit impact of the “Botany B9 Paper Machine”.  The line reads “Costs of Goods Sold” and covers projected costs of goods sold over 3 years.  I do not accept that disclosure of this line should be subject to special protection orders.  The figure forms part of a chart.  The purpose of the chart is to forecast the profit impact of the plant.  The figures set out are necessarily forecasts.  Moreover, the balance of the chart is not subject to a claim for special protection orders.  That is significant.  In the absence of such a claim, any first year accounting student would know what line had been omitted and could reverse engineer the answer.

37                        Document 33 dated 7 February 2008 is entitled “B9 Capital Expenditure Request – Supporting Information”.  Again, Amcor seeks special protection orders over limited parts of the document. 

38                        Page 10 is partly concerned with Amcor’s costs of production in the 2008 financial year.  That part of the chart (the first column in the bar chart) should only be disclosed to the Cadbury Instructors (including Mr Banati).  As for the other information, I consider that it is also entitled to the protection sought by Amcor, namely it should only be disclosed to the Cadbury Instructors (including Mr Banati).  Although it is concerned with the cost of production in China, because of the form of the chart, disclosure of the information would enable Cadbury personnel involved in negotiations for the CFP contract to make an assessment (through comparison) of Amcor’s costs for the 2008 financial year.

39                        Page 11 is directed at “fibre input cost comparisons”.  Special protection orders are sought by Amcor over the chart that appears on the page.  Amcor’s counsel submitted that the chart created an “unavoidable impression”.  I have no doubt that the chart does just that.  The difficulty is that Amcor did not seek a special protection order for the title to the chart which discloses the substance of the analysis.  The chart provides a visual demonstration of the disclosed analysis and does it by reference to prices per tonne.  Most of the data was sourced externally.  In my view, Amcor is entitled to a special protection order for the second bar in the bar chart which should be disclosed to the Cadbury Instructors (including Mr Banati).  The balance of the document (i.e. all except the second bar in the bar chart) is subject to the Harman undertaking.

40                        Page 15:  In my view, the figures on this page should not be subject to special protection orders and should be disclosed subject to the Harman undertaking.  They are Amcor’s estimates of Paperlinx’s production costs.  Moreover, as is recorded in the Consolidated Pleadings, there is no dispute that since 2000 Amcor has not had a production facility for virgin Kraft paper for use in manufacturing CFP.

41                        Page 22 needs to be split.  The information in the bar chart for the financial years up to and including 30 June 2007 are not current and should not be subject to a special protection order.  The title of the page (for which Amcor did not seek a special protection order) confirms that view.  The bar for the 2008 financial year should only be disclosed to the Cadbury Instructors (including Mr Banati).  The bar for Visy is Amcor’s estimate and should be disclosed subject to the Harman undertaking.  The last bar – entitled “B9 08” should also be disclosed subject to the Harman undertaking.  It is an estimate and based on the fact that the Botany upgrade would occur which, we know now, has at the very least been deferred. 

42                        Page 23 was not pressed by Amcor and should be disclosed subject to the Harman undertaking.  Page 25 was not challenged by Cadbury as it concerned data for the 2008 financial year.  Disclosure is limited to the Cadbury Instructors (including Mr Banati).

43                        Page 26:  This page should be subject to special protection orders and disclosure should be limited to the Cadbury Instructors (including Mr Banati).  Although the information is primarily concerned with the 2007 financial year, it is inextricably linked with current information and disclosure of part of it would, in my view, be misleading.

44                        Page 39 contains an extract of the data that appears on page A.233.001.0150 in document 34.  It is to be treated in the same manner:  see [50-52] below.

45                        Page 40 contains some of the data that appears on page A.233.001.0149 in document 34.  It is to be treated in the same manner:  see [50-52] below.

46                        Page 44 calculates the Net Present Value (“NPV”) of the B9 project, a project that has not proceeded, over two models – a 20 year model and a 30 year model.  Amcor claims special protection orders for the figures included in both models for “cost of production / tonne”, “price growth” and “cost growth”.  In my view, disclosure of these figures should be limited to the Cadbury Instructors (including Mr Banati).  In relation to cost of production / tonne, the analysis records that the figures for the 2008 financial year have been used.

47                        Page 45 is a NPV sensitivity analysis.  The heading and the bar chart (for which no special protection order is sought) discloses the substance of the analysis.  It is therefore surprising that Amcor seeks special protection orders in relation to some of the figures set out in the Chart.  The page should be disclosed subject to the Harman undertaking.

48                        Page 47 is the Summary and Conclusions page.  Amcor seeks special protection orders in relation to three figures which appear elsewhere in the document or are derived from figures elsewhere in the document:  e.g. pages 10, 53.  In my view, disclosure of these figures should be limited to the Cadbury Instructors (including Mr Banati).

49                        Pages 51, 53 - 58 are entitled “Review Potential Alternative Strategies”.  There is no dispute that disclosure of the information concerning Amcor’s position in the 2008 financial year should be limited to the Cadbury Instructors (including Mr Banati).  In my view, disclosure of the balance of the figures should be limited to the Cadbury Instructors (including Mr Banati).  They are the source of the figures in earlier pages (e.g. pages 47) and it is difficult given the form of the documents to separate out a figure or figures which would not attract special protection orders.

50                        Document 34 is a submission entitled “B9 Botany Mill” dated 12 February 2008.  Again, Amcor seeks special protection orders over limited parts of the document.  The first two figures appear on page A.233.001.0148.  The first figure concerns “1/6/06”.  It is outside the period for which Amcor claims special protection orders.  Amcor agrees that this figure is not subject to a claim.  The second figure concerns “Feb 08”.  Cadbury accepts that this figure should only be disclosed to the Cadbury Instructors (including Mr Banati).

51                        The next disputed figures appear on page A.233.001.0149.  They appear under the heading “Cost of Production Benefit” directed at explaining what would happen if the B9 Botany Mill upgrade proceeded.  The figures on the next page (A.233.001.0150) are of a similar nature.  The upgrade did not proceed.  As I understand the facts, Amcor decided against proceeding with the upgrade but have not abandoned the idea altogether.  Amcor’s claims for special protection orders suffer the same problems as those identified in relation to page 6 of document 32 (A.233.001.0161): see [36].  Some of the figures are forecasts.  Some of the chart on page A.233.001.0149 concerns data in 2006.  On any view, that is not current information.  The data in relation to 2008 is current information.  The difficulty is that the balance of the document for which there is no special protection order sought discloses so much of the current position (e.g. the heading), that it is difficult to identify what aspect or aspects would require special protection orders.  On balance, I have concluded that the first figure in the heading and the first bar in the chart should be disclosed only to the Cadbury Instructors (including Mr Banati).

52                        In relation to the chart on page A.233.001.0150, most of the chart is not subject to a claim for special protection orders.  In the absence of such a claim, the position here is even easier for any first year accounting student – they could just reverse engineer the first figure in line 1 because the wording of the line item (“Cost of Production Improvement”) was not subject to a claim by Amcor.  Amcor does claim special protection orders over the comments section of the chart.  In my view, figures in the comments section of the chart should be disclosed to the Cadbury Instructors (including Mr Banati) because they appear to relate to current 2008 paper costs.

Rowell – Document 36 of Annexure A

53                        The information in document 36 was, as I understood the submissions, sourced from Mr Phillips.  The parties agreed that resolution of the confidentiality claims in relation to the Phillips material would resolve the answer to the confidentiality claims in relation to this document.  If that position changes, the parties are at liberty to ask the Court to address this document separately.

Ward – Documents 40 and 42 of Annexure A

54                        Copies of these documents were not provided to the Court:  cf Mobil [1996] 2 VR 34 at 39.  Instead, Mr Ward described the contents of them.  That is not appropriate or sufficient.

55                        Document 40 was described by Mr Ward as “contain[ing] information summarising Amcor’s costs and margins for the supply of CFP to Cadbury’s confectionery business in 2007 and 2008”.  I do not know whether this information refers to the 2007 calendar or financial year.  In the absence of other relevant considerations, if it is the former, disclosure should be limited to the Cadbury Instructors (including Mr Banati); if it is the latter, it should be disclosed subject to the Harman undertaking.

56                        Document 42 was described as “contain[ing] financial data relevant to the sale of recycled and Kraft paper from [Amcor’s] paper business to the corrugated business from 1 July 2002 to 30 June 2008”.  That part of document 42 (document E.227.001.0008_0001) which is in dispute concerns the 2007 and 2008 financial year.  Cadbury accepts that disclosure of information concerning the 2008 financial year should be limited to the Cadbury Instructors (including Mr Banati).  So far as the document concerns the 2007 financial year, it should be disclosed subject to the Harman undertaking for the reasons earlier expressed.

B.        DOCUMENTS CONTAINING COMMERCIALLY SENSITIVE INFORMATION RELATING TO AMCOR’S CANS BUSINESS

General

57                        Cadbury is no longer in the beverage business.  It sold its beverage business in April 2009.  Despite that fact, Amcor seeks to limit the disclosure of documents containing the following information relating to its cans business:

1.         information about profit margins for the period from 1 January 2004 to present;

2.         information about commercial arrangements with customers for the adoption of the “202 Superend”; and

3.         information about its return on funds employed in the period from 1 January 2007 to present.

58                        Amcor’s written submissions explained the position it adopted in the following terms:

The basis for the application is that the sensitivity of the information is such that its dissemination within Cadbury should be restricted, in order to reduce the risks of (i) inadvertent disclosure and (ii) employees leaving Cadbury and taking knowledge with them to a cans customer or a competitor.  Mr Licheni give evidence relevant to the assessment of those risks at paragraphs 11(c) and 14 of his affidavit (in particular, instances of employees moving to competitors or customers and from customer to customer).

59                        Unlike CFP, Cadbury does not compete with and is not a customer of Amcor in relation to cans.  It once did but no longer does.  Secondly, Amcor’s reference to reducing the “risks of inadvertent disclosure” is not in itself a reason for a special protection order in addition to the implied undertaking.  That is what the implied undertaking is intended to do – reduce the risk of inadvertent disclosure. 

60                        That leaves the question of current Cadbury employees (with access to the information) leaving Cadbury and taking knowledge with them to a cans customer or competitor.  Cadbury sold its cans business in April 2009.  There are no Cadbury employees currently engaged in the cans business.  Notwithstanding these facts, Amcor still seeks the limitations set out in [57] above.  In relation to prices and profit margins associated with the supply of cans to Cadbury or other large cans customers, Mr Licheni, the Group General Manager, Beverage Cans & Closures for Amcor Australasia, provided sworn evidence that although the prices and margins vary over time they generally remain quite stable.  As a result, Mr Licheni asserted that a contract in 2000 (whether or not that contract was still on foot) was likely in relative terms to provide a good indication of Amcor’s current market pricing and margin in relation to Cadbury and Amcor’s largest cans customers.  For those reasons, Mr Licheni selected a cut off of 1 June 2004.  Simply stating Amcor’s position about its selection of the “cut off date” supports the view that Amcor’s claim should be rejected. 

61                        Put that together with the earlier facts - that Cadbury is no longer in the Cans business and that the implied undertaking operates to limit the use of information obtained in litigation - Amcor’s complaint is really that there is a “risk” that one of Cadbury’s employees might sometime in the future be employed by one of Amcor’s cans customers or competitors.  In the circumstances described, that “risk” does not support a special protection order.  Accordingly, I reject Amcor’s submission that it is entitled to special protection orders for this category of documents and that the documents should be disclosed subject to the usual Harman undertaking unless they clearly relate to current contractual relations with one or more of its customers.  If they are of the latter kind, then disclosure should be limited to the Cadbury Instructors (including Mr Banati).

62                        Against that general position, I now turn to consider each of the documents in dispute.

Facts and assumptions

63                        As noted earlier (see [17]), Amcor contended that certain parts of the “Facts and Assumptions” provided to both Professors Hausman and Hay were confidential and entitled to special protection.  Part of paragraphs 185(c), 186(c) and 191 and Confidential Exhibit A relate to cans.  For the reasons stated in [60] and [61], the documents should be disclosed subject to the usual Harman undertaking unless they clearly relate to current contractual relations with one or more of its customers.  If they are of the latter kind, then disclosure should be limited to the Cadbury Instructors (including Mr Banati).

Licheni – Documents 12-13 and 15-22 of Annexure A

64                        Document 12 is part of paragraph 103(c) of the Licheni affidavit.  It concerns Amcor’s current contractual relations with customers.  In my view, disclosure of that document should be limited to the Cadbury Instructors (including Mr Banati).  It is the same information included in paragraph 6.45.4 of the Potter Report.

65                        Document 13 is part of paragraph 106(d) of the Licheni Affidavit.  It concerns Amcor’s current contractual relations with customers.  In my view, disclosure of that document should be limited to the Cadbury Instructors (including Mr Banati).  It is the same type of information as that included in paragraph 103(c) of the Licheni affidavit and paragraph 6.45.4 of the Potter Report.

66                        Document 15 is entitled “Amcor Beverage Cans – Strategic Plan 2005” and is dated April 2005.  Amcor seeks a special protection order for a set of figures that appear on A.119.020.0069 that are said to disclose Amcor’s forecast and budgeted margins.  The information is not current.  For the reasons stated in [60] and [61], the documents should be disclosed subject to the usual Harman undertaking unless they clearly relate to current contractual relations with one or more of its customers.  If they are of the latter kind, then disclosure should be limited to the Cadbury Instructors (including Mr Banati).

67                        Document 16 is entitled “Amcor Australasia 1^st Quarter Update” and is dated October 2005.  Amcor seeks a special protection order for a set of figures that appear on A.119.020.0045 that are said to disclose Amcor’s margins.  The information is not current.  For the reasons stated in [60] and [61], the documents should be disclosed subject to the usual Harman undertaking unless they clearly relate to current contractual relations with one or more of its customers.  If they are of the latter kind, then disclosure should be limited to the Cadbury Instructors (including Mr Banati).

68                        Document 17 is entitled “Amcor Australasia Strategic Plan” and is dated October 2005.  Amcor seeks a special protection order for a set of figures that appear on A.119.020.0003 that are said to disclose the amount of amortisation on the Coca Cola and Cadbury contracts.  The information is not current.  For the reasons stated in [60] and [61], the documents should be disclosed subject to the usual Harman undertaking, except for the entry in relation to Coca Cola, because it appears to relate to the current contractual relations with Amcor.  Disclosure of that line should be limited to the Cadbury Instructors (including Mr Banati).

69                        Document 18 is entitled “AA – Monthly Indicators Report June 2007”.  Amcor seeks a special protection order for the whole page.  For the reasons stated in [60] and [61], the documents should be disclosed subject to the usual Harman undertaking.

70                        Document 19 is entitled “Beverage Can Group Financial Profit and Loss”.  Amcor seeks a special protection order for the whole page.  For the reasons stated in [60] and [61], the documents should be disclosed subject to the usual Harman undertaking.

71                        Document 20 is a copy of the cans contract between Amcor and Coca Cola dated 31 October 2002.  Amcor seeks a special protection order for the amounts that the Amcor Group will pay Coca Cola from 1 July 2003 to 1 July 2009.  For the reasons stated in [60] and [61], disclosure of these figures should be limited to the Cadbury Instructors (including Mr Banati).

72                        Document 21 is a copy of the amended cans contract between Amcor and Carlton United Breweries dated 20 February 2003.  Amcor seeks a special protection order for the document.  For the reasons stated in [60] and [61], the document should be disclosed subject to the usual Harman undertaking.

73                        Document 22 is concerned with Cadbury and is entitled “Profitability Review Financial Year Ending June 2000 - 2008”.  Amcor seeks a special protection order for all the entries except Volume (m), Net Sales and Aluminium.  Most of the information is not current.  In addition, for the reasons stated in [60] and [61], the documents should be disclosed subject to the usual Harman undertaking.

Potter – Document 26 of Annexure A

74                        Document 26 is in fact two documents: part of paragraphs 6.41.2 and 6.45.4 of the Potter Report.  For the reasons stated in [60] and [61], I consider that disclosure of the sections highlighted by Amcor in both paragraphs 6.41.2 and 6.45.4 should be limited to the Cadbury Instructors (including Mr Banati).  These concern Amcor’s current contractual relations with customers.  Part of the information is included in paragraph 103(c) of the Licheni Affidavit.

Roberts – Document 30 of Annexure A

75                        Document 30 is part of paragraph 41(e) of the Roberts Report.  It relates to events in February 2003.  That information is not current.  It should be disclosed subject to the Harman undertaking.

ORDERS

76                        I will not make final orders today.  Instead, I will direct the parties to prepare appropriate orders to give effect to these reasons for decision by 4:00pm on 24 June 2009.  If the parties cannot agree, the matter may be listed for further hearing.

Associate:

Dated:         19 June 2009