FEDERAL COURT OF AUSTRALIA
Thomas International Limited v Humantech Pty Ltd (No 2) [2015] FCA 808
IN THE FEDERAL COURT OF AUSTRALIA | |
DATE OF ORDER: | |
WHERE MADE: |
THE COURT NOTES:
1. The applicant undertakes to the Court that it will:
(a) submit to such order (if any) as the Court may consider to be just for the payment of compensation, to be assessed by the Court or as it may direct, to any person, whether or not a party, adversely affected by the operation of any of the interlocutory orders and undertakings referred to herein;
(b) pay the compensation referred to in (a) to the person there referred to in paragraphs 2 to 6 below; and
(c) pay the first and third to fifth respondents’ administrators their reasonable costs and expenses up to a maximum of $3,000 in relation to any work that they might reasonably be required to undertake for the purpose of facilitating the audit referred to in paragraph 2 below.
2. Each of the respondents undertakes to the Court that it or he will provide access to the premises at Suite 2508, Westfield Tower 2, 101 Grafton Street, Bondi Junction, NSW, 2022 from 9am to 5pm on business days from 13 August 2015 and for so long as may reasonably be required, to an agreed independent expert or, if not agreed, two independent accounting experts (one nominated by the applicant and one nominated by the respondents) for the purpose of inspecting and auditing the financial books and records of the first to fifth and the seventh and eighth respondents (“the Audit”) and providing a report to the Court as to whether (and, if so, to what extent) the first respondent and/or the second respondent has failed to account for royalty payments due to the applicant since 2010 (as alleged in paragraph 40 of the Further Amended Statement of Claim).
3. The sixth respondent undertakes to the Court that, until the determination of the proceeding or further order, the fourth respondent, whether by its directors, employees or agents (excluding its Administrators):
(a) will not represent, in trade or commerce, that the fourth respondent has any association with, or the sponsorship or approval of, the applicant;
(b) will not make any statements, in trade or commerce, with respect to the content of the discussions between the parties on 17 and 18 May 2015;
(c) will not supply any of the TIL Products and Services (as set out in the Schedule hereto); and
(d) will take reasonable steps to inform their existing and prospective customers (in writing if that is practicable) to whom they provide or desire to provide any feedback or training services in respect of TIL Products and Services (as set out in the Schedule) that their business is not associated or affiliated with the applicant’s business.
4. The second, sixth, seventh and eighth respondents, whether by their servants or agents or otherwise, undertake to the Court that, until the determination of the proceeding or further order, they:
(a) will not represent that the second, sixth, seventh and/or eighth respondents have any association with, or the sponsorship or approval of, the applicant;
(b) will not supply any of the TIL Products and Services (as set out in the Schedule hereto); and
(c) will take reasonable steps to inform their existing and prospective customers (in writing if that is practicable) to whom they provide or desire to provide any feedback or training services in respect of TIL Products and Services (as set out in the Schedule) that their business is not associated or affiliated with the applicant’s business.
5. By 4pm on 7 August 2015, the sixth respondent is to file and serve an affidavit which identifies all third parties to whom any of the respondents or any company of which the sixth respondent is a director or shareholder has provided units on User Dongles (as defined in paragraph 60 of the affidavit of Amir Qureshi affirmed 17 June 2015) since 14 May 2015 and identify all income generated therefrom.
6. At 9.30am on 10 August 2015, or at such other time as is convenient to the Court, the second, seventh and eighth respondents are to produce to the Court all Master Dongles and User Dongles (as defined in paragraphs 62 and 60 respectively in the affidavit of Amir Qureshi affirmed 17 June 2015) in their possession, custody or control.
7. The above undertakings are given by the respondents without admission of liability.
SCHEDULE TO UNDERTAKINGS
(a) Thomas Personal Profile Analysis (PPA), being a tool, including a questionnaire for an individual, that provides a behavioural assessment of the individual (available since 1981 ).
(b) Thomas Personal Profile Analysis Plus (PPA+), being a more detailed version of the PPA which is used when the individual has comprehension challenges, language difficulties or in the case of an invalid PPA result.
(c) Thomas General Intelligence Assessment (GIA), being a tool, including a questionnaire for an individual, that provides a measure of learning potential and trainability of the individual by testing reasoning, spatial visualisation, number speed and accuracy, perceptual speed and word meaning (GIA Sub-tests) (available since 2006).
(d) Thomas Tests for Selection and Training (TST), being a tool identical to the GIA save that, instead of word meaning, the TST measures working memory (available since 1993).
(e) Thomas Trait Emotional Intelligence Questionnaire (TEIQue), being a tool, including a questionnaire for an individual, used to provide an assessment of the emotional capacity, traits and characteristics of the individual (available since 2006).
(f) Thomas Skills (Thomas Skills), being a tool, including a questionnaire for an individual, used to provide an assessment of the individual's skills in systems such as Microsoft Office and customer service (available since 2006).
(g) Thomas 360 (Thomas 360), being a tool, including various questionnaire templates for an individual, his or her peers, direct reports and indirect reports, used to assess the individual regarding various aspects of his or her employer's business and provide feedback to the individual (available since 2012).
(h) Diagnostics (Diagnostics) being a tool that uses an expert review of issues affecting a team through a combination of brainstorming and a competency paired analysis (available since 1983).
(i) Benchmarking (Benchmarking) being a tool that identifies successful characteristics in an individual that is rolled out in recruitment or development, thereby setting the right performance standards (available since 1990).
(j) SaMB (SaMB) is a tool which helps to understand a person's impact on others by being more self-aware with a view to modifying that behaviour to become better at building effective relationships (available since 1983).
(k) Personal Assessment Centre (PAC) being a one to one assessment that utilises a combination of various TIL Products to pinpoint development needs, behaviour, aptitude and overall suitability to the role (available since 1992).
(l) Thomas Engage (Engage) being a tool used to establish the levels of engagement within an organisation by carrying out a quick 5 minute "health check" that identifies necessary actions for improvement (available since 2015).
(m) Thomas Jobs (Thomas Job) being a tool used in conjunction with PPA to identify the behavioural requirements of a particular job that is being recruited for (available since 1983).
(n) eRecruit being an online Applicant Tracking System (ATS).
(o) Education (Passionate about changing lives of Young People through self awareness and developing the leaders of tomorrow).
(p) Sport (Passionate about realising the potential of every athlete, coach, sporting organisation).
THE COURT ORDERS THAT:
1. Any information obtained by the applicant’s independent expert or any agreed independent expert during or in connection with the Audit may only be used for the purpose of this proceeding and must be kept confidential and not disclosed directly or indirectly, to any officer or employee of the applicant or to any third party except the solicitors and counsel retained to appear for the applicant in this proceeding without the prior written agreement of the respondents or the leave of the Court.
2. All copies, notes, records, and analyses, memoranda and reports brought into existence by the independent expert or experts are not to be destroyed or deleted and must be preserved until further order so that they are available to be produced to the Court if required.
3. Leave be granted to the applicant pursuant to s 440D of the Corporations Act 2001 (Cth) to proceed against each of the first, third, fourth and fifth respondents until the determination of this proceeding or further order.
4. The interlocutory application be otherwise dismissed.
5. The proceeding be stood over to 9.30am on 10 August 2015 for directions.
6. Each party, and any independent expert engaged to perform the Audit, has liberty to apply on 3 days’ notice.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
NEW SOUTH WALES DISTRICT REGISTRY | |
GENERAL DIVISION | NSD 546 of 2015 |
BETWEEN: | THOMAS INTERNATIONAL LIMITED Applicant |
AND: | HUMANTECH PTY LTD (ACN 121 808 973) First Respondent JCS HUMAN DYNAMICS (PTY) LTD (SOUTH AFRICAN COMPANY REGISTRATION NO 1998/012319/07) Second Respondent THOMAS INTERNATIONAL (AUSTRALIA) PTY LTD (ACN 103 702 978) Third Respondent ASSESSMENT CENTRE TECHNOLOGIES PTY LTD (ACN 142 138 743) Fourth Respondent JCS HUMAN DYNAMICS PTY LTD (ACN 121 807 752) Fifth Respondent JOHAN CHRISTIAAN SCHUTTE Sixth Respondent THOMAS INTERNATIONAL MANAGEMENT SYSTEMS (SA) (SOUTH AFRICAN COMPANY REGISTRATION NO 1971/011542/07) Seventh Respondent ASSESSMENT CENTRE TECHNOLOGIES (SOUTH AFRICAN COMPANY REGISTRATION NO 2005/002625/07) Eighth Respondent |
JUDGE: | NICHOLAS J |
DATE: | 10 August 2015 |
PLACE: | SYDNEY |
REASONS FOR JUDGMENT
1 On 31 July 2015, I accepted various undertakings and made related orders disposing of an interlocutory application filed by the applicant (“TIL”).
2 Some of the background to the latest interlocutory application appears in my earlier reasons explaining why I made orders against the second and third respondents requiring the transfer of certain domain names to the applicant: see Thomas International Limited v Humantech Pty Limited [2015] FCA 541. In addition to providing some background to the commercial dispute that has given rise to this proceeding, I also referred in those reasons to the principles relevant to granting or withholding interlocutory relief: see [6]-[11].
3 There are several additional matters I should note by way of further background. After delivery of my earlier reasons, the second respondent filed an address for service. It was represented at the interlocutory hearing by the same solicitor and counsel who act for the sixth respondent, Mr Schutte. In another development after publication of my earlier reasons, two additional companies (each of which is incorporated in South Africa) were joined as the seventh and eighth respondents. Both of those companies, Thomas International Management Systems (SA) (“TISA”) and Assessment Centre Technologies (“ACT SA”), are ultimately controlled by Mr Schutte. They have both submitted to the jurisdiction of this Court and, until recently, were represented by the same solicitor and counsel who appeared for Mr Schutte.
4 On 23 June 2015 the applicant filed its most recent interlocutory application seeking an order for an audit (“the audit order”) which would, if made, require each of the respondents, including TISA and ACT SA, to provide access to various business premises located in New South Wales and South Africa for the purpose of allowing an inspection of their books and records. It is important to note that the audit order sought by the applicant was not sought by way of discovery or inspection pursuant to the rules, but by way of mandatory interlocutory injunction which the applicant says it would be entitled to obtain on a final basis.
5 There are two other interlocutory orders that were also sought by the applicant to which I should refer. It sought an order restraining the fourth respondent (“ACT Australia”) from supplying “… any of the TIL products and services” (as defined in paragraph 10 of the Further Amended Statement of Claim (“FASC”)) and/or any feedback services or training services (as defined in paragraph 6(f) and 6(g) respectively of the affidavit of Amir Qureshi affirmed 17 June 2015) which specifically relate to the TIL products and services (as defined in paragraph 10 of the FASC). The applicant sought an order in substantially the same terms against the second, sixth, seventh and eighth respondents.
6 All other interlocutory orders that were ultimately sought by the applicant against the respondents were more or less agreed in terms that reflect the outcome of debate that occurred during the course of the hearing. Mr McKeand SC, who appeared for Mr Schutte and the South African companies, informed me that his clients would provide (without admissions) various interlocutory undertakings to operate until the determination of the proceeding or further order subject to the applicant providing the appropriate cross-undertakings.
7 In response to the applicant’s application for the audit order, the Australian respondents indicated that they were willing to undertake to allow access to their premises located at Bondi Junction, New South Wales:
… for the purpose of inspecting and auditing the financial books and records of the corporate Respondents and provide a report to all parties as to whether the First Respondent and/or the Second Respondent has failed to account for royalty payments due to the Applicant (as set out in in paragraph 40 of the Further Amended Statement of Claim) since 2010.
It is apparent that what was proposed by the respondents was considerably narrower than what was sought by the applicant.
8 Other undertakings which Mr Schutte and the South African respondents were willing to provide would restrain the fourth respondent from representing that it has any association with, or sponsorship or approval by, the applicant and that it will not make any statements with respect to the content of the discussions between the parties on 17 and 18 May 2015. The second, seventh and eighth respondents were also willing to undertake, on the same basis, that they not represent, in trade or commerce, that they have any association with, or sponsorship or approval by, the applicant.
9 The first question dealt with in these reasons is whether the applicant should be granted the audit order it seeks or whether it should be granted some narrow form of relief such as that proposed by the respondents.
10 One consequence of the way in which the interlocutory application was put by the applicant is that, if the audit order it sought was made, the applicant would be free to use any information obtained as a result of the audit for the purposes of its own commercial purposes. In fact, it seemed to me that the principal purpose for which the applicant sought the audit order was to enable it to obtain as much customer information as it could relevant to the businesses carried on by the corporate respondents both before and after the applicant’s purported termination of the MLA so that it could use that information for its own commercial purposes. According to Mr Qureshi’s affidavit evidence:
The reason the audit is important to the Applicants business is:
(a) the Applicant needs to have knowledge of dealings with past customers as the Respondents quarantined the Applicant from this information during the term of the MLA. This knowledge is critical in enabling the Applicant to resurrect its business in Australia and South Africa and minimising any disruption to customers and enabling and facilitating business continuity;
(b) the audit is critical to the Applicant in assisting it to stabilise its business in Australia and South Africa and restore a business connection with existing and historical customers of the TIL Products and Services prior to termination of the MLA.
11 In oral evidence Mr Qureshi reiterated that the applicant needs the information which it hopes to obtain by means of the audit so that it can “find out who they are to be able to talk to them.”
12 As between the applicant, on the one hand, and the first and second respondents, on the other, the applicant could point to cl 8.3 of the Master Licence Agreement (the “MLA”). That clause provides:
Humantech shall at all times keep full and proper books of account and records showing clearly all transactions in the business and shall permit TI and its authorised representatives at all reasonable times and for a period of six months following the termination of this agreement for any reason, to have access to the premises where such books are retained for the purposes of inspecting and/or auditing the said books and records.
(original emphasis)
13 Though cl 8.3 is not expressed to bind the second respondent, the MLA was signed by Mr Schutte on behalf of the second respondent, and the applicant contended that the obligations imposed by cl 8.3 of the MLA bind both the first and second respondents.
14 The other way in which the application for the audit order was put relied upon the execution by Mr Schutte and others (Mr Stander, Mr Jonker and Mr Jacobus Schutte) on behalf of the corporate respondents of various undertakings signed on 17 May 2015 in the circumstances outlined by me in my earlier judgment. The documents executed on that occasion included written undertakings on the part of each of the corporate respondents and Mr Schutte to the following effect:
Proper Books of Account and Records
9. We will provide TIL (or its representatives) at any time nominated by TIL during the week commencing 9am Wednesday, 20 May 2015 or such earlier date as TIL may request with access to:
a. Our premises at Suites 1704 and 2508, Westfield Tower 2, 101 Grafton Street, Bondi Junction NSW 2021;
b. Our premises at 201 Brookfield Park, 273 Middle Street, New Muckleneuk, 0181 Waterkloof; and
c. any premises where We (or agents, servants or otherwise acting on our behalf or upon our instructions) keep our books and records,
for the purpose of inspecting and/or auditing them.
10. We will provide TIL (or its legal representatives) by 12pm on Monday, 18 May 2015 with an electronic copy of up to date financial accounts.
11. We will retain all such books and records for a minimum period of 5 years from the date of these Undertakings and to allow TIL access to such books and records for a period of 6 months from today.
12. TIL agrees to only use the financial documents provided in accordance with 9 and 10 above for the purposes of the Proceedings and any corresponding proceedings for the territory of the MLA.
15 These undertakings (and equivalent undertakings included in another document relied upon by the applicant) provide the sole basis upon which the applicant sought to justify the audit order which is sought against those corporate respondents which are not parties to the MLA.
16 There are three important points to make about the proposed audit order.
17 First, it is implicit in the way in which the applicant put its case based upon the written undertakings, that it has an unfettered right to use the information so obtained, not only for the purpose of determining whether Humantech, or any one or more of the corporate respondents have complied with their contractual obligations to the applicant, but for any purpose at all. I say this because it is clear from the applicant’s evidence that it wishes to obtain information by its proposed audit not only for the purpose of determining whether or not the corporate respondents have complied with any relevant contractual obligations, but also to enable it to ascertain the identity of all people with whom the respondents may have had commercial dealings so that the applicant may then approach them directly and, presumably, seek to solicit business. This is in circumstances where at least some of the corporate respondents contend that they have been carrying on the business of providing psychometric services in a way which was perfectly lawful, which did not involve any breach of the MLA, and which they say they will, or at least may, continue to provide notwithstanding the termination of the MLA or the provisions of the written undertakings to which I have referred.
18 Secondly, the respondents contend that the written undertakings relied upon by the applicant were obtained in circumstances which render them liable to be set aside. This point was raised by the respondents in the course of the previous interlocutory contest concerning the transfer of the domain names, but was not a matter about which there was much evidence or any detailed submissions made. However, further evidence was filed by the respondents and more detailed submissions put to me by Mr McKeand SC in support of this aspect of his clients’ proposed defence in relation to the applicant’s latest interlocutory application. None of the respondents has filed any defence or cross-claim at this stage. That is not due to any lack of activity on their part but merely reflects the fact that the applicant’s own pleading has already been the subject of two or three substantial amendments and no orders for the filing of any defence or cross-claim have been made.
19 The third and critical point is that the applicant’s application for the audit order, and its stated reasons for asking the Court to make it, ignored cl 12 of the written undertaking. It would be a breach of cl 12 for the applicant to use any of the information obtained otherwise than for the purpose of this proceeding. Given the purpose for which the audit order was sought by the applicant, I was satisfied that there is no proper basis for making the audit order sought, at least not against any respondent other than the first and second respondents (who were parties to the MLA).
20 The undertaking to the Court proffered by the respondents gives the applicant access to the books and records of the first respondent and, according to Mr McKeand SC, the books and records of the other corporate respondents which are kept in electronic form at the same premises.
21 I accepted the undertaking proposed by the respondents subject to some slight modifications. In my view, there must also be some safeguards imposed that prevent the applicant (even if only inadvertently) using any of the information obtained through the audit for its own commercial purposes.
22 I now turn to the other orders that were sought by the applicant.
23 The applicant’s FASC includes paras 10 and 10A which state:
10. Since 1981, TIL has created and developed various products and services, being psychological testing and psychometric assessments, competency and skills-based assessments, including for vocational and personnel management, business research and efficiency and consultancy and training services (TIL Products and Services), which it has made available at various different times (as indicated below) to be promoted and sold, directly and through distributors around the world and in particular throughout the Africa and Asia Pacific regions including Australia as set out in paragraph 12 below and including the following:
(a) Thomas Personal Profile Analysis (PPA), being a tool, including a questionnaire for an individual, that provides a behavioural assessment of the individual (available since 1981).
(b) Thomas Personal Profile Analysis Plus (PPA+), being a more detailed version of the PPA which is used when the individual has comprehension challenges, language difficulties or in the case of an invalid PPA result.
(c) Thomas General Intelligence Assessment (GIA), being a tool, including a questionnaire for an individual, that provides a measure of learning potential and trainability of the individual by testing reasoning, spatial visualisation, number speed and accuracy, perceptual speed and word meaning (GIA Sub-tests) (available since 2006).
(d) Thomas Tests for Selection and Training (TST), being a tool identical to the GIA save that, instead of word meaning, the TST measures working memory (available since 1993).
(e) Thomas Trait Emotional Intelligence Questionnaire (TEIQue), being a tool, including a questionnaire for an individual, used to provide an assessment of the emotional capacity, traits and characteristics of the individual (available since 2006).
(f) Thomas Skills (Thomas Skills), being a tool, including a questionnaire for an individual, used to provide an assessment of the individual's skills in systems such as Microsoft Office and customer service (available since 2006).
(g) Thomas 360 (Thomas 360), being a tool, including various questionnaire templates for an individual, his or her peers, direct reports and indirect reports, used to assess the individual regarding various aspects of his or her employer's business and provide feedback to the individual (available since 2012).
(h) Diagnostics (Diagnostics) being a tool that uses an expert review of issues affecting a team through a combination of brainstorming and a competency paired analysis (available since1983).
(i) Benchmarking (Benchmarking) being a tool that identifies successful characteristics in an individual that is rolled out in recruitment or development, thereby setting the right performance standards (available since 1990).
(j) SaMB (SaMB) is a tool which helps to understand a person's impact on others by being more self-aware with a view to modifying that behaviour to become better at building effective relationships (available since 1983).
(k) Personal Assessment Centre (PAC) being a one to one assessment that utilises a combination of various TIL Products to pinpoint development needs, behaviour, aptitude and overall suitability to the role (available since 1992).
(l) Thomas Engage (Engage) being a tool used to establish the levels of engagement within an organisation by carrying out a quick 5 minute "health check" that identifies necessary actions for improvement (available since 2015).
(m) Thomas Jobs (Thomas Job) being a tool used in conjunction with PPA to identify the behavioural requirements of a particular job that is being recruited for (available since 1983).
(n) eRecruit being an online Applicant Tracking System (ATS).
(o) Education (Passionate about changing lives of Young People through self awareness and developing the leaders of tomorrow).
(p) Sport (Passionate about realising the potential of every athlete, coach, sporting organisation).
10A. The Thomas Products are made available to customers by way of the Thomas hub or remotely by a user dongle.
24 Paragraph 10 of the FASC does not mention “feedback services” specifically (subpara (g) relates to something slightly different). At para 84B of the FASC it is alleged that since at least on or about 11 June 2015 the second respondent “has provided TIL Products”. At para 84I it is alleged that “[t]he provision of feedback on a [Personal Profile Analysis] is one of the TIL Services”.
25 Paragraph 6 of Mr Qureshi’s affidavit of 17 June 2015 states:
The procedure for a customer obtaining the TIL Products and Services is as follows:
(a) a candidate is sent an “invitation” by the Applicant or an authorised distributor;
(b) the candidate completes the Thomas test;
(c) the completed test is automatically forwarded to the Applicant;
(d) the Applicants proprietary software generates a report based on the answers given by the candidate in the Thomas test;
(e) that report is sent to either Thomas or the authorised distributor;
(f) Thomas or the authorised distributor will then provide feedback on the report and the candidate generally. That includes a trained psychologist interpreting the various results and representatives of Thomas, consulting with, and advising the customer (Feedback Services); and
(g) Thomas also provides training services to enable clients to interpret reports generated for them for internal candidates (Training Services).
The applicant’s proposed order picked up the definitions of “Feedback Service” and “Training Service” that appear in this paragraph of Mr Qureshi’s affidavit. Those services, as defined by Mr Qureshi, appear to be somewhat broader than those referred to in para 10 of the FASC.
26 The second, sixth, seventh and eighth respondents proffered undertakings to the Court which would prevent them, until the determination of the proceeding or further order, from supplying any of the TIL Products and Services as enumerated in para 10, subparas (a)-(p) of the FASC. The question was then whether the balance of convenience favoured the grant of the wider form of interlocutory relief sought by the applicant.
27 The undertakings proffered by the respondents would prevent them supplying any of the TIL Products and Services as defined in Schedule 2 of the respondents’ proposed minute of order. Schedule 2 of the minute of order identifies the particular tools that are referred to in para 10 of the FASC but does not, as I read it, pick up “feedback services” such as are referred to in para 84I of the FASC.
28 If made, the interlocutory orders proposed by the applicant would have prevented the respondents from providing feedback on the psychological and psychometric test results and assessments identified in para 10(a)-(p) of the FASC or providing training services to enable clients to interpret reports generated for them for internal candidates.
29 The applicant submitted that it needed the interlocutory injunction it sought to protect it against reputational damage that it may suffer in the event that any of the respondents’ customers are led to believe that the “feedback” or “training” services offered by the respondents were authorised by TIL or that TIL otherwise approves of such services.
30 Whether or not the respondents have in the past (including since termination of the MLA) engaged in any conduct that would be likely to mislead, deceive or cause confusion in this regard is a matter for trial. For present purposes I accepted (but without exploring the issue in detail) that there was a prima facie case that some customers might be misled, or at least caused to wonder, whether the services offered by the respondents were authorised or accredited by TIL.
31 There was some discussion in the course of the hearing concerning the example of the Toyota motor company. It seems that it has used TIL tools for some years (for which TIL has presumably received payments) and that ACT Australia has provided what TIL calls “feedback services”.
32 TIL’s position is that feedback services cannot be provided by ACT Australia without TIL’s permission. However, in the case of Toyota, it seems to have been under no relevant misapprehension in that it fully understands that the MLA was terminated and that ACT Australia has no ongoing consent or permission to hold itself out as being an authorised or licensed supplier of either “feedback” or “training” services. Be that as it may, it seems Toyota still wishes to do business with ACT Australia and obtain “feedback” services from that company.
33 I think the possibility that TIL might suffer any reputational harm along the lines suggested in argument is appropriately addressed (at least at this stage of the proceeding) by an additional undertaking from the second, sixth, seventh and eighth respondents which requires each of them to notify its existing customers and potential customers to whom it proposes to provide feedback or training services that it is not authorised to provide such services in relation to TIL Products and Services (ie. any of the tools referred to in subpara (a)-(p) of para 10 of the FASC) for or on behalf of TIL or with its authority or approval. It seems to me that this is a reasonable way of providing the applicant with the protection it seeks at least until the determination of the proceeding.
DISPOSITION
34 It was for those reasons I dismissed the applicant’s application for interlocutory relief subject to the parties providing to the Court the relevant undertakings. I also made a confidentiality order the purpose of which is to ensure that any information that is obtained by the applicant’s independent expert or any agreed independent expert as a result of the audit is kept confidential.
35 The applicant asked me to reserve costs of the interlocutory application, whereas the respondents submitted that the applicant had engaged in “overreach” and that it should pay the respondents’ costs.
36 The issue of costs is slightly complicated. First, as against the South African corporate respondents, I am satisfied that the applicant had no proper basis to seek the relief it sought against those companies. As against the first and second respondents, the applicant could at least point to cl 8.3 of the MLA. Even then, as argued, the applicant’s case was entirely focused on the written undertakings.
37 The undertakings proffered by the respondents were, except in one respect referred to at [33], at least equal to or better than what the respondents offered to provide (on a without admissions basis) by way of undertakings to the Court. Further, a considerable part of the interlocutory hearing was devoted to arguments advanced by the applicant which were ultimately rejected by me.
38 In the circumstances, I think the appropriate order for costs is that the applicant pay 30% of the respondents’ costs of the applicant’s interlocutory application.
I certify that the preceding thirty-eight (38) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Nicholas. |
Associate: