FEDERAL COURT OF AUSTRALIA

Gall v Domino’s Pizza Enterprises Limited [2019] FCA 1799

REASONS FOR JUDGMENT

MURPHY J:

1    This is the adjudication of an interlocutory dispute regarding a claim of confidentiality by the respondent, Domino’s Pizza Enterprises Ltd (Domino’s), in relation to documents discovered and to be discovered in the proceeding.

2    The substantive proceeding is a class action brought by the applicant, Mr Riley Gall, on his own behalf and on behalf of all persons who, at any time during the period of 24 June 2013 to 23 January 2018, were employed as delivery drivers or in-store workers by a Domino’s franchise operator (the franchisee), were covered by the Fast Food Industry Award 2010 (the Award) and were not paid the applicable rates or afforded the terms and conditions of employment prescribed by the Award. Broadly, the proceeding alleges that Domino’s engaged in conduct in its dealings with its franchisees that misled and deceived the franchisees in respect of their obligations to their employees under the Award, as a result of which they were not paid the applicable rates or afforded terms and conditions of employment in accordance with the Award. Domino’s conduct is alleged to have contravened s 18 of the Australian Consumer Law.

background

3    On 22 August 2019 Domino’s was ordered to produce a tranche of initial discovery of some restricted categories of documents (the initial discovery documents) and it subsequently produced a tranche of approximately 109 documents. Domino’s however claimed that all of the documents produced were confidential and before it would allow inspection of the documents it required the applicant’s solicitors to provide a confidentiality undertaking in relation to the documents, the terms of which would prohibit the applicant’s legal team from disclosing the contents of the initial discovery documents to the applicant himself, the litigation funder of the proceeding, or to the applicant’s consultants and service providers. The applicant declined to provide the undertakings sought.

4    Pending the Court’s determination of an appropriate confidentiality regime the parties agreed on interim confidentiality arrangements pursuant to which the applicant’s legal team, the applicant and a representative of the funder were permitted to review the initial discovery documents. That allowed instructions to be obtained from the applicant in respect of an Amended Statement of Claim which was then prepared and filed on 26 September 2019. Because the amended pleading refers to a number of the initial discovery documents which Domino’s claims are confidential it was filed on a confidential basis.

5    To deal with Domino’s claim of confidentiality over the documents discovered and to be discovered the parties have proposed competing confidentiality regimes. They seek the Court to determine the issue.

Domino’s proposed confidentiality regime

6    Domino’s proposes a confidentiality regime (the Domino’s regime), as follows:

(a)    the inspection of documents discovered by Domino’s in the proceeding be confined to such of the following persons who have signed a confidentiality undertaking in a specified form, namely:

(i)    any partner or employee of Phi Finney McDonald, the applicant’s solicitors, directly engaged in the conduct of the proceeding;

(ii)    any barrister engaged in the conduct of the proceeding on behalf of the applicant;

(iii)    any independent expert engaged in the conduct of the proceeding; or

(iv)    any other person approved in writing by Domino’s;

(b)    the proposed confidentiality undertaking includes requirements:

(i)    to use the documents only for the purposes of the legal proceedings;

(ii)    to not disclose, discuss or enable access to the documents to any other person unless reasonably satisfied that person has signed a confidentiality undertaking in substantially the same terms;

(iii)    neither show the documents, records, copies or any documents which are made or arise from the discovered material to, nor discuss the contents with, any other person (including the applicant), who has not provided a confidentiality undertaking in substantially the same terms;

(iv)    if the signatory is a solicitor or barrister acting for the applicant and it is proposed to refer to or use the documents in the proceeding, to take all reasonable steps to ensure that the documents are not disclosed in open court and only used or reproduced:

(1)    as part of a confidential exhibit or annexure; or

(2)    in a confidential section of any report or statement;

without first giving Domino’s three clear business days’ notice of the intention to make use of the document; and

(v)    upon the conclusion of the proceeding to return all copies of the documents, including electronic copies, to Domino’s and to destroy any documents produced by reference to the documents.

(c)    in the event that the applicant’s solicitors wish to “further publish” any discovered document for the purposes of the proceeding they are to so notify Domino’s;

(d)    as soon as practical after receiving notice that the applicant’s solicitors wish to “further publish” any discovered document for the purposes of the proceeding, Domino’s is required to prepare and provide the applicant’s solicitors with a further copy of each such document redacted for confidentiality, commercial sensitivity and relevance, and the parties are to thereafter confer with a view to resolving any disputes as to the redactions made, given the purposes of the proposed “further publication” by the applicant’s solicitors;

(e)    the Court is to resolve any dispute in respect of any redacted discovered document;

(f)    once the parties agree on, or the Court determines the redactions, that redacted discovered document may be “published” to a third person who has signed a confidentiality undertaking in the same terms.

7    An unusual feature of the Domino’s regime is that it deems every document discovered and to be discovered in the proceeding as being confidential, as a class, and as being sufficiently confidential to require additional protection to that provided by the implied undertaking (sometimes called the Harman undertaking, derived from Harman v Secretary of State for Home Department [1983] 1 AC 280). Under the Domino’s regime only the applicant’s solicitors, counsel and independent experts are granted access to unredacted documents and only upon their entering into the required confidentiality undertaking. It requires the applicant’s legal team to inform Domino’s that it proposes to use a document in some way whereupon Domino’s is to propose redactions of the document for confidentiality, commercial sensitivity and relevance, before the document may be used. It is not entirely clear what the Domino’s regime means by the prohibition, unless it has first notified Domino’s, on the applicant’s solicitors ‘further publishing’ a document ‘for the purposes of the proceeding’. I understand it to mean a prohibition on the applicant’s legal team referring to or using any discovered document in open submissions, pleadings, affidavits or in Court unless it has first notified Domino’s.

8    Under the Domino’s regime the applicant, the funder, and the applicant’s consultants and service providers will not have access to unredacted discovered documents. The proposed confidentiality undertaking provides that the applicant’s solicitors, counsel and independent experts are not permitted to even discuss discovered documents with those parties unless they have also signed a confidentiality undertaking in the same terms. If those parties, including the applicant himself, do enter into the confidentiality undertaking, they can only have access to a document redacted for confidentiality, commercial sensitivity and relevance. The parties must then confer in relation to the proposed redactions, and if they do not agree the Court is to resolve the dispute.

The applicant’s proposed confidentiality regime

9    The applicant proposes a different confidentiality regime (the applicant’s regime), as follows:

(a)    Domino’s shall identify those parts of any discoverable document which are subject to a claim of confidentiality, and state the grounds and basis for the claim (claimed confidential material);

(b)    if the applicant proposes to challenge a claim of confidentiality with respect to claimed confidential material, and the parties remain in dispute concerning confidentiality with respect to that material, that challenge will be resolved by the Court on application;

(c)    claimed confidential material may, pending resolution of any challenge to such confidentiality, nevertheless be disclosed at any time to the applicant’s legal team;

(d)    claimed confidential material may, pending resolution of any challenge to such confidentiality, be disclosed to the applicant, the funder, independent experts retained to give evidence, and any consultants retained by the applicant, subject to each signing a confidentiality undertaking (with such undertaking ceasing to apply to materials which are subsequently determined not to be confidential or where confidentiality is waived or withdrawn by Domino’s); and

(e)    the applicant is permitted to refer to and particularise the contents of claimed confidential material in documents filed with the Court, and use the material in open court, subject to providing the respondent with notice of his intention to do so.

Consideration

10    Applications for discovery are dealt with under Part 20 of the Federal Court Rules 2011 (Cth). A party to a proceeding before the Court 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 limits including: (a) valid claims for privilege from production; and (b) the implied undertaking that a party may not use discovered documents except for the purpose of the action in which the discovery is made.

11    The fact that a discoverable document is confidential is not ordinarily a sufficient reason to deny inspection by the opposite party. The implied undertaking will usually provide sufficient protection to the producing party and a 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 undertaking: see Cadbury Pty Ltd v Amcor Limited (No 2) [2009] FCA 663 (Cadbury) at [6]-[7] (Gordon J).

12    Deciding whether it is appropriate to make orders to further restrict access to discovered documents in a way that is additional to the protection granted by the implied undertaking will usually involve balancing competing considerations. On the one hand, the party entitled to production of discoverable documents has an interest in having access to documents held by its opponent that are relevant to the issues in the litigation. On the other hand, the producing party may be concerned about the risk of inadvertent disclosure, which risk can be said to increase the greater the number of people given access to the documents. Where the parties to litigation are commercial competitors the producing party may be concerned about the damage to its commercial interests by the disclosure of sensitive business information to a trade rival. Trade rivals cannot realistically be expected to forget what they have been permitted to see through discovery: Mobil Oil Australia Ltd v Guina Developments Pty Ltd [1996] 2 VR 34 (Mobil) at 38 (Hayne JA, with whom Winneke P and Phillips JA agreed).

13    The courts commonly make orders that impose a confidentiality regime to limit the persons given access to confidential discovered documents, and to require those persons who are allowed access to provide a confidentiality undertaking which limits how they may use the documents and to whom they may disclose their contents. That is especially the case for trade rivals, but the use of such confidentiality regimes is not limited to such cases. The order must be fashioned to meet the circumstances of the case: see Cargill Australia Ltd v Viterrra Malt Pty Ltd [2018] VSCA 260 (Cargill) at [122]-[126] (Kyrou and McLeish JJA).

14    In AstraZeneca AB v Medis Pharma Pty Ltd [2014] FCA 549 (AstraZeneca) at [10], Besanko J set out the following principles in relation to the required balancing exercise, with which I respectfully agree :

The relevant legal principles are as follows:

(1)    The onus of establishing a claim for confidentiality is on the party making the claim.

(2)    The question of whether a claim for confidentiality should be upheld or refused involves a balancing exercise in which the competing considerations are the risk of inadvertent or accidental disclosure on the one hand, and the benefits of a party having access to relevant information so that appropriate advice can be given to the client and informed instructions received from the client, on the other.

(3)    In determining where the balance lies in a particular case, a number of matters are relevant, including the following:

   (i)    the nature and content of the confidential information;

(ii)    the extent to which, if the confidential information is disclosed to a particular person, that person will have occasion to use the information to further a party’s commercial interests. In this context, involvement or lack of involvement in competitive decision-making will be relevant. It will also be relevant to consider whether the person to whom it is proposed to disclose the information owes or may owe contractual, statutory or fiduciary duties to their principal in relation to competitive decisions;

(iii)    the professional attributes of the persons to whom it is proposed to disclose the information and the extent to which they have participated in confidentiality clubs in the past;

(iv)    the extent to which the Court can be satisfied that, if confidential information is released to a person, that person, or the organisation for which the person works, has in place a security system that will protect the confidentiality of the information;

(v)    undertakings given by the proposed recipient of the confidential information or the party seeking disclosure to meet any loss caused by inadvertent or accidental disclosure;

(vi)    although the above five matters are directed, primarily at least, to the risk of inadvertent or accidental disclosure of the confidential information and the likely loss if that occurs, on the other side of the equation, it is relevant to consider the extent to which a party’s ability to seek advice and provide instructions may be hampered if a claim for confidentiality is upheld. In this context, it is worth noting that a claim for confidentiality in relation to certain persons is not necessarily to be upheld because there is already one person able to seek advice and provide instructions. It may be appropriate for a number of people from within an organisation to have access to confidential information in order to seek appropriate advice and provide informed instructions, particularly in the case of a large organisation and complex litigation. Whether that is so or not depends on the outcome of weighing the relevant factors.

(Citations omitted.)

15    The requirements of ss 37M and 37N of the Federal Court of Australia Act 1976 (Cth) (the Act) should also be kept in mind. The overarching purpose of the civil procedure and practice provisions is to facilitate the just resolution of the dispute according to law, and as quickly, inexpensively and efficiently as possible.

16    In my view there are a number of problems with the regime proposed by Domino’s.

17    First, it is rooted in a misunderstanding of the protection in relation to the confidentiality of discovered documents already provided through the implied undertaking. In Hearne v Street [2008] HCA 36; (2008) 235 CLR 125 (Hearne) the plurality (Hayne, Heydon and Crennan JJ) explained (at [103]) that the protection is not only personal to the litigant and the authorities recognise a broader principle that “persons who, knowing that material was generated in legal proceedings, use it for purposes other than those of the proceedings are in contempt of court”. Third parties, who are not parties to the litigation, are also bound by the obligations created by the implied undertaking, which applies to all servants and agents of a party, all potential lay and expert witnesses and all other persons who have received material generated by litigious processes. Their Honours explained (at [112]) that a party seeking an order for contempt of court based on breach of the implied undertaking need only show that the disclosed material originated in legal proceedings and it is not necessary for them to show that the disclosing party knew of the undertaking or of the consequences of its breach.

18    A party seeking an order for protection of the confidentiality of its discoverable documents additional to that granted by the implied undertaking must establish that the character of the document is such that it should attract such additional protection: Cadbury at [7]. Domino’s did not address the specific character of the documents and instead sought orders to impose a confidentiality regime in relation to all the initial discovery documents and all documents it discovers in the future, doing so on the basis that certain information contained therein was confidential, commercially sensitive or irrelevant, without identifying that information with specificity.

19    Second, Domino’s claim of confidentiality over all of the initial discovery documents is overstated. The initial discovery documents to which the applicant referred in the Amended Statement of Claim (at paragraphs 28A, 29, 30, 30A, 31, 33, 33A, 40A, 48, 50, 51 and 51A) are not apparently confidential nor commercially sensitive. Yet Domino’s claimed confidentiality over all of them and sought to impose a confidential undertaking which prohibited the applicant’s solicitors and counsel from disclosing the contents of the documents even to the applicant.

20    I have no difficulty in accepting that some parts of the initial discovery documents may be confidential or commercially sensitive but Domino’s overstatement of its claim for confidentiality is cause for concern about the approach it will take in relation to future discovery.

21    Third, there is no evidence whatsoever to show that all of the documents to be discovered by Domino’s in the future are confidential, or to show an arguable basis upon which to presume their confidentiality such that it is appropriate to restrict access to them, as a class. Yet under the Domino’s regime the applicant’s legal team and independent experts are only permitted access to any of the discovered documents conditional upon their signing a confidentiality undertaking which includes terms that the documents:

(a)    not be disclosed to or even discussed with any other persons, including the applicant, unless they have signed the same confidentiality undertaking; or

(b)    used in submissions, pleadings, affidavits or in open court without their first notifying Domino’s and reaching agreement as to any redactions for confidentiality, commercial sensitivity and relevance, or the Court deciding that issue.

22    Fourth, under the Domino’s regime the applicant has no entitlement to review discovered documents which have not been redacted for confidentiality and commercial sensitivity. All discoverable documents are to be treated as confidential from him. Under the Domino’s regime the applicant:

(a)    cannot receive advice from his lawyers in relation to the import of any unredacted discovered documents; or

(b)    provide instructions to his lawyers in relation to any further amendments to the pleadings which particularise the claims by reference to unredacted discovered documents;

without his lawyers first reaching agreement with Domino’s lawyers as to redactions for confidentiality, commercial sensitivity and relevance or the Court ruling on that question.

23    There is force in the applicant’s contention that if his solicitors and counsel cannot discuss with, or reveal the content of, any unredacted discovered document to him (without first agreeing redactions with Domino’s or having the Court decide them) then his capacity to provide meaningful instructions will be impeded. Even if I was to accept Domino’s contention that, having regard to the nature of the case, the requirement for the applicant’s legal team to provide discovered documents to the applicant or discuss them with the applicant may be more limited than in other cases, the Domino’s regime is likely to impede the applicant’s case preparation and introduces some delay and inefficiency.

24    Requiring the applicant’s solicitors to communicate with and endeavour to agree with Domino’s solicitors in relation to documents which it wishes to disclose to or discuss with the applicant for the purposes of the litigation also wrongly intrudes into the privileged discussions between the applicant and his legal team. It means that Domino’s solicitors will know which documents the applicant’s solicitors are discussing with the applicant which may give Domino’s a tactical advantage in the proceeding.

25    Fifth, Domino’s regime operates akin to a suppression or non-publication order made under ss 37AF and 37AG of the Act and Domino’s expressly relies on those provisions in seeking orders to establish its proposed regime. Under its regime, if the applicant’s solicitors and counsel wish to disclose or refer to any discovered document in submissions, affidavits in the proceeding or in open court they must take all reasonable steps to ensure that the documents are not disclosed in open court and only used or reproduced as part of a confidential exhibit or annexure or in a confidential section of any report or statement, without first giving Domino’s three clear business days’ notice of the intention to make use of the document.

26    But whether parts of a party’s submissions or evidence are ultimately to be treated as confidential is a question for the Court, and s 37AE of the Act provides that in deciding whether to make a suppression or non-publication order the Court “must take into account that a primary objective of the administration of justice is to safeguard the public interest in open justice”. The test for whether a non-publication or suppression order would be made in the present case is whether such an order is necessary to prevent prejudice to the administration of justice. ‘Necessary’ is a strong word which can be distinguished from less demanding standards such as whether a suppression or non-publication order would be “convenient, reasonable or sensible”: Hogan v Australian Crime Commission [2010] HCA 21; (2010) 240 CLR 651 at [30]-[31]. Embarrassment or reputational damage is not enough to justify a suppression order, as such results are the price of open justice: Bianca Hope Rinehart v Georgina Hope Rinehart [2014] FCA 1241; (2014) 320 ALR 195 at [28] (Jacobson J).

27    There is no evidence at present to justify a non-publication or suppression order in relation to the initial discovery documents or the documents that Domino’s will discover in the future.

28    Sixth, it is necessary to consider the considerations relevant to the balancing exercise described in AstraZeneca (at [10]), which I will undertake by reference to the persons (or categories of person) to whom the applicant proposes to provide discovered documents.

The nature and content of the confidential information

29    There is some evidence as to the nature and content of the purportedly confidential information in the initial discovery documents, and I accept that some part of the material may be confidential or commercially sensitive. I was however taken to nothing to show that any of those documents were of a character which required additional protection to that provided by the implied undertaking, except in relation to one of the persons to whom the applicant proposed to disclose unredacted documents. There was no evidence that the documents upon which the applicant relied in the Amended Statement of Claim are confidential and, as I have said, Domino’s overstated its claim of confidentiality in relation to the initial discovery documents.

30    There is little or no evidence as to the nature and content of the confidential information in any documents that may be discovered in the future. Having said that I have no difficulty in accepting that some or some parts of them may be confidential or commercially sensitive. The absence of such evidence, and Domino’s attempt to impose additional confidentiality obligations in relation to all documents to be discovered in the future, is a fundamental weakness in Domino’s regime.

The applicant

31    Under the Domino’s regime Mr Gall will not have access to unredacted discovered documents. Provided that he enters into a confidentiality undertaking he will be permitted access to discovered documents that have been redacted by Domino’s for confidentiality, commercial sensitivity and relevance.

32    Domino’s argues this is appropriate because the risk of inadvertent disclosure of confidential information increases with the number of people in receipt of the discovered documents. It also argues that it is far from apparent that there is any necessity for the applicant to review the documents when the proceeding does not allege that the applicant or any of the class members relied on Domino’s conduct, and the scope for the applicant to provide instructions in relation to documents that passed between Domino’s and its franchisees is unclear.

33    I take a different view. Mr Gall was formerly employed by two Domino’s franchisees and he now works in information technology. He is not a trade rival of Domino’s and there is no evidence that he will have any interest in or opportunity to use the confidential information for an improper purpose such as to further his own interests outside the litigation.

34    The question of whether Domino’s claim for confidentiality should be upheld or refused involves a balancing exercise in which the competing considerations are, on the one hand the risk of disclosure, and on the other hand the benefits of Mr Gall having access to relevant information so that appropriate advice can be given to him and informed instructions received from him. I accept that if his solicitors and counsel cannot discuss, or reveal the content of, any discovered document with Mr Gall (without first agreeing redactions with Domino’s) then his capacity to provide meaningful instructions will be impeded, as was seen in the process of preparing the Amended Statement of Claim. I do not accept that, in the circumstances of the case, the applicant is not required to be appraised of unredacted discovered documents or information contained therein to be in a position to provide meaningful instructions. Further, Domino’s regime would require the applicant’s solicitors to inform Domino’s solicitors what discovered documents they wished to send to the applicant to ask his instructions which in my view, as I noted above, wrongly intrudes into the applicant’s privileged discussions with his lawyers.

35    In the course of the hearing Domino’s accepted that as long as Mr Gall signs a confidentiality undertaking that brings home his obligations under the implied undertaking it did not oppose his having access to unredacted discovered documents. The applicant agreed in-principle to sign such an undertaking, the form of which is to be agreed between the parties.

The applicant’s legal team

36    Under the Domino’s regime the applicant’s solicitors and counsel have access to unredacted discovered documents, but they are required to enter into a confidentiality undertaking which restricts their provision of such documents to the applicant and relevant third parties and restricts the use in the proceeding of such documents and information derived from them.

37    In my view the proposed restrictions are not appropriate. There is no evidence or any suggestion that the applicant’s solicitors or counsel have any interest in or have occasion to use any confidential information to further their own interests. They are not trade rivals of Domino’s.

38    The courts have confidence in permitting the solicitors and counsel for an opposing party to have access to confidential discovered documents because they are officers of the Court, and they owe duties to the Court which override their duties to their client. They have powerful incentives to comply with the implied undertaking being: (a) punishment for contempt of court which may include a custodial sentence; (b) professional disciplinary action by the Court or legal regulatory authority, including the ultimate sanction of being struck off the roll of practitioners; and (c) an award of damages for any loss that is suffered as a result of a breach of the implied undertaking: see Cargill at [128]-[129].

39    The implied undertaking provides sufficient protection of Domino’s confidential information and there is little to indicate that it is appropriate to impose protection additional to that which is already afforded by the implied undertaking. I infer that the applicant’s legal team are well aware of their obligations under the implied undertaking, and that there is no need to reinforce them.

The independent experts engaged by the applicant

40    Under the Domino’s regime the independent experts engaged by the applicant will have access to unredacted discovered documents, but they are required to enter into a confidentiality undertaking which restricts their provision of such documents to the applicant and other third parties.

41    It is appropriate to include in this category both independent experts who are engaged for the purpose of providing a report and testifying in the proceeding, and also independent experts engaged as consultant or so-called “dirty” experts, engaged to advise and assist the applicant’s lawyers on technical matters. In relation to the latter, the applicant’s counsel said that it might be decided to provide discoverable documents to a consultant academic industrial expert to obtain advice on the transmission of business and the application of awards and industrial agreements. Domino’s accepted that consultant experts should be treated the same as testifying experts for the purposes of any confidentiality regime.

42    I do not consider it necessary to impose a confidentiality regime on independent experts to set out protections additional to those provided under the implied undertaking. There was no evidence or any suggestion that any independent experts engaged or to be engaged by the applicant have any interest in or have occasion to use any confidential information to further their own interests. They are not trade rivals of Domino’s.

43    The courts usually have confidence in permitting independent experts to access confidential discovered documents because they are bound by the Harmonised Expert Witness Code of Conduct which provides, among other things, that they are not an advocate for a party and that they have a paramount duty to the Court, which overrides any duty to the party retaining them. They have no personal interest in the content of the documents and may be subject to sanctions by contempt of court for breach of the implied undertaking or for damages occasioned by such a breach: see Cargill at [130].

44    The implied undertaking provides sufficient protection of Domino’s confidential information and there is little to indicate that it is appropriate to impose protection additional to that which already exists under the implied undertaking. It seems likely that the independent experts will have participated in “confidentiality clubs” in the past and it is appropriate to infer that they will be aware of their obligations under the implied undertaking. There is no need to reinforce or enhance those obligations by requiring them to enter into a confidentiality undertaking.

The funder

45    Under Domino’s regime the litigation funder of the proceeding, Therium Litigation Finance Atlas AFP IC, (Therium) will not have access to unredacted discovered documents. Provided that it enters into the proposed confidentiality undertaking, it will have access to documents which have been redacted by Domino’s for confidentiality, commercial sensitivity and relevance.

46    I do not accept that it is appropriate to restrict Therium’s access to discovered documents such that it only has access to redacted documents. Pursuant to the implied undertaking discovered or subpoenaed documents provided to a litigation funder can only be used for the purposes of the proceeding: Hearne at [109]. It goes without saying that if, without leave of the Court, Therium used discovered documents or information derived from them, in relation to another proceeding or proposed proceeding that would be a breach of the implied undertaking.

47    Therium is a large international litigation funder which regularly funds sizeable litigation in Australia and Europe and by virtue of that it should be taken to understand its obligations under the implied undertaking and the importance of compliance with those obligations. Domino’s did not contend that Therium had ever been found to have breached its obligations, and it made no suggestion that Therium is a funder of poor repute.

48    Therium is not a trade rival of Domino’s and there is no evidence that it will have an interest in or have occasion to use any confidential information obtained through the litigation to further its own commercial interests. The highest Domino’s submissions rose was to contend that Therium might use confidential information to bring other cases against Domino’s, but there is no evidence that other litigation against Domino’s is even ‘in the wind’, let alone evidence that Therium is contemplating funding such litigation. For example, there is no evidence that Therium or a plaintiff lawyer has ‘flagged’ bringing a case, as often occurs. The suggestion that Therium might use documents or information that it receives in some other unflagged and unidentified litigation is not sufficient to justify imposing protections beyond those already in place through the implied undertaking.

49    Domino’s also argues that because the litigation funding agreement expressly provides that, save for limited and defined circumstances, Therium does not give instructions in, have control over, or have a right to make decisions in the proceeding, there is no necessity for it to be provided with discovered documents.

50    I take a different view. Under the funding agreement the applicant is required to instruct his solicitors to provide Therium with any document obtained by way of discovery, subpoena or other coercive power, for the purposes of, amongst others, allowing Therium to monitor the progress of the litigation relative to the litigation costs and to evaluate any settlement offer. I doubt that Therium would have agreed to fund multi-million-dollar litigation unless it was able to at least monitor the case and its prospects of success, including through having access to discovered documents or information derived from them. The funding agreement has a procedure for resolution of disputes regarding the reasonableness of any settlement, and to participate in that procedure Therium must be able to evaluate any proposed settlement including by access to discovered documents or information derived from the discovered documents. Further, although Therium cannot give instructions to the applicant’s legal team, it of course retains the prerogative to cease funding the proceeding if it reaches the view that the merits or quantum of the case do not justify its expenditure and risk.

51    In the course of the hearing Domino’s accepted that its position was sufficiently protected if the relevant Therium employees signed a confidentiality undertaking that reinforced and brought home to them their obligations under the implied undertaking, and Domino’s was informed of their identity. The applicant agreed to that approach. The form of the confidentiality undertaking is to be agreed between the parties. It should include a requirement that the relevant employees and/or Therium have in place a system that will protect the confidentiality in the information received.

The applicant’s consultants

52    Under the Domino’s regime the applicant’s consultants will not have access to unredacted discovered documents. Upon their entering into a confidentiality undertaking they may have access to documents redacted by Domino’s for confidentiality, commercial sensitivity and relevance.

53    In part, whether it is appropriate to restrict access by the applicant’s consultants to discovered documents depends upon who the consultants are or the categories into which they fall. It appears that there are two categories:

(a)    first, the applicant’s counsel said that the applicant might wish to provide discoverable documents to an academic industrial expert, to obtain advice regarding the application of awards and agreements and on transmission of business. As I have said, insofar as the applicant’s consultants are consultant or so-called “dirty” experts, Domino’s accepted that they should be treated the same as other independent experts; and

(b)    second, the applicant’s counsel said that it might be decided to provide discoverable documents to Mr Josh Cullinan, the Secretary of the Retail and Fast Food Workers Union (the RFFWU), to obtain advice and assistance in the proceeding. The RRFWU is one of the two unions representing the industrial interests of employees working in the sector, some of whom are likely to be class members in the proceeding.

54    Domino’s argues that Mr Cullinan will have occasion to and may be tempted to use confidential information to further his pursuit of the industrial interests of RFFWU members, and of the RFFWU which it said is competing for members against the other union in the sector. It says that, particularly in the heightened atmosphere of that membership competition, Mr Cullinan may be tempted to use confidential information for the purpose of advancing the RFFWU’s interests. It also submits that even if Mr Cullinan does not intend to use discovered documents for purposes outside the litigation, he cannot realistically be expected to forget what he has been permitted to see through discovery: Mobil at 38.

55    There is no evidence that Mr Cullinan intends to or would use discovered documents or information derived from them for purposes outside the litigation, and I make no criticism of him or his role in the proceeding. But he cannot be expected to forget what he learns through viewing the documents and an occasion may arise where he could use information he has obtained by reviewing discovered documents to further the industrial interests of RFFWU’s members or of the RFFWU itself. In my view that justifies a requirement for protection additional to the implied undertaking and I consider the following confidentiality arrangements to be appropriate:

(a)    before he may be provided with discovered documents Mr Cullinan must enter into a confidentiality undertaking which reinforces and enhances his obligations under the implied undertaking, in a form to be agreed between the parties. It should include a requirement that he and the RFFWU have a system in place that will protect the confidentiality of the information received;

(b)    the applicant’s solicitors shall provide no less than three days advance notice to Domino’s solicitors of the discovered documents that they propose to provide to Mr Cullinan;

(c)    Domino’s solicitors shall, within three days or such longer period that is agreed, provide to the applicant’s solicitors a further copy of each such document redacted for any claimed confidentiality or commercial sensitivity, together with reasons for the proposed redactions; and

(d)    the parties shall then confer, and if they cannot agree on appropriate redactions within three days, the Court will rule on that dispute.

In the event that a dispute does arise in relation to redactions to discovered documents to be provided to Mr Cullinan, Domino’s must take a more sensible approach to claims of confidentiality and commercial sensitivity than it did in relation to the initial discovery documents. Blanket or overstated claims to confidentiality will not be looked upon favourably.

The applicant’s service providers

56    Under the Domino’s regime the applicant’s service providers will not have access to unredacted discovered documents unless they enter into a confidentiality undertaking, whereupon they may have access to redacted documents.

57    The service providers to whom the applicant’s solicitors propose to provide discovered documents are: (a) providers of discovery or document management services for litigation (eg Law in Order) and (b) a costs referee. They are bound by the implied undertaking: Hearne at [109]. They do not have an interest in or occasion to use such confidential information for their own commercial purposes. They are regularly engaged as service providers in large litigation and should be taken to understand that they are bound by the implied undertaking and to understand the importance of compliance with their obligations in that regard. There is nothing to indicate that it is appropriate to impose protection additional to that which already exists under the implied undertaking.

The proposed prohibition on ‘publishing’ documents

58    It would be surprising in a business of Domino’s size if some of its discoverable documents, or some parts of them, were not confidential or commercially sensitive, such that their publication might cause Domino’s commercial harm through the activities of a commercial competitor or a trade union representing the industrial interests of employees working for its franchisees.

59    Under the applicant’s proposed regime Domino’s will be required to identify those parts of any discoverable document which are subject to a claim of confidentiality, and state the grounds and bases for the claim. Then if the applicant proposes to challenge the claimed confidentiality, and the parties remain in dispute concerning confidentiality with respect to that material, that challenge will be resolved by the Court on application.

60    That has the disadvantage that it would require Domino’s to go to the time and expense of going through all their discoverable documents in order to make redactions for confidentiality or commercial sensitivity. It seems likely that discovery will be voluminous and redacting the documents will therefore be a time-consuming and expensive process. It is also likely to involve inefficiency because experience teaches that many such documents will be of limited relevance and the great majority will not ultimately be relied upon by either party or adduced in evidence. Thus, much of the time and expense spent in redacting them will be wasted.

61    Under Domino’s regime it is not required to go to the time and expense of redacting every discoverable document and instead it is only put to that time and expense in relation to identified documents which the applicant’s solicitors propose to provide to certain third parties or to refer to or use the documents in open submissions, affidavits or otherwise before the Court. Having regard to the overarching obligation under ss 37M and 37N of the Act I consider it is appropriate to incorporate this feature into the confidentiality regime to be ordered.

62    In relation to the provision of discovered documents to third parties the only restriction I have allowed at present relates to the provision of documents to Mr Cullinan. It is only the documents which the applicant’s solicitors notify Domino’s they propose to provide to him that Domino’s will need to redact, which should considerably reduce the number of documents to be considered and the necessary time and expense.

63    In relation to Domino’s confidential or commercially sensitive information which may come into the public arena by the applicant’s legal team using or referring to unredacted discovered documents in open submissions, affidavits or in court I propose that, at least up until trial, the following regime be adopted:

(a)    before the applicant’s solicitors or counsel refer to or use any discovered document in submissions or affidavits, other than in a section over which confidentiality is claimed, they provide three days’ notice to Domino’s solicitors;

(b)    within 48 hours of the provision of notice, Domino’s solicitors provide to the applicant’s solicitors a further copy of the relevant documents, redacted for any claimed confidentiality or commercial sensitivity (but not for relevance), together with reasons for the proposed redactions; and

(c)    the parties shall then confer and, if they cannot agree on appropriate redactions, the Court will rule on that dispute.

64    If the applicant’s solicitors only refer to or use such a document in an annexure or section over which confidentiality is claimed, there is no requirement to provide advance notice to Domino’s. Those documents will be treated as confidential on an interim basis, until that claim of confidentiality is determined by the Court at the interlocutory hearing to which the submissions or affidavits relate.

Whether redactions for relevance should be allowed

65    In Egglishaw v Australian Crime Commission (No 2) [2009] FCA 12; (2009) 253 ALR 354 (Egglishaw) Besanko J held that the permissibility of unilateral redaction for relevance depended upon whether there was an order for general discovery, stating that the practice was permissible when general discovery was ordered, but not when orders were made for discovery by categories. As his Honour expressly acknowledged (at [26]) that conclusion was at odds with the decision in Australian Competition and Consumer Commission v McMahon Services Pty Ltd [2004] FCA 353; (2004) ATPR 41-996 (McMahon Services) where Selway J (at [12]–[13]) said:

It may be that there is a practice in England that parts of a document can be masked simply because those parts of the document are not thought to be relevant: see GE Capital Corporate Finance Group Ltd v Bankers Trust Co & Ors [1995] 1 WLR 172. I note that that case would seem to have been followed by Olsson J of the South Australian Supreme Court: see Peat Marwick Hungerford’s v Executor Trustee & Ors (unreported decision delivered 25 October, 1995). However, in this Court the Rules and the practice would seem to be quite clear that what must be discovered and produced (save for any question of privilege) is the whole of the document if any part of it is discoverable. Indeed, the fact that part of the document is relevant may well mean that all of it is relevant if only to provide the context for that part of it which is directly relevant.

There remains a discretion not to order that the masked part of the documents be produced: see, in the somewhat different context of Order 15A, Sony Music at 89-92. There is no obvious reason in this case why the whole of the documents should not be discovered and produced. True it is that some parts of them seem to have very little evidentiary value and some parts of them make allegations against third parties which may well be quite unfair. However, all of the allegations seem to concern the first respondent and at least one of the allegations is directly related to the matters which are the subject of these proceedings. The third parties are protected by the inherent powers of the Court to prevent the publication or use of discovered material for purposes not connected with the litigation.

66    In Fig Tree Developments Ltd v Australian Property Custodian Holdings Ltd [2008] FCA 1041 (at [45]) Logan J reviewed the authorities touching upon redacting parts of discovered documents produced for inspection. Then, in Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd (No 4) [2010] FCA 863 (at [25]) Logan J referred to his earlier decision and (at [92]-[99]) discussed the relevant authorities relating to redactions of parts of discovered documents for relevance. His Honour preferred the approach taken in McMahon Services to that taken in Egglishaw and held that, save in cases where privilege is claimed, the whole of a discoverable document should be produced unless there is prior agreement to the contrary from the opposing party or some prior dispensation by the Court.

67    It is unnecessary to resolve the conflict in the authorities in the context of the present dispute and in my view this is not a question of high principle. I do not intend this as a rule of general application but in the circumstances of the present case I take a similar view to Logan J with respect to unilateral redactions for relevance. This is a large and complex class action which is likely to involve voluminous discovery by Domino’s. One of the difficulties with allowing unilateral redactions for relevance in this case is that it will involve the exercise of judgment, probably by quite junior members of Domino’s legal team. I am concerned to avoid an overzealous approach to relevance being taken and redactions being made with insufficient regard to the comprehensibility of the document after it is made, including because the redactions for relevance occur in combination with other redactions for confidentiality and privilege: see Menkens v Wintour [2006] QSC 342; (2007) 2 Qd R 40 at [13] (McKenzie J) citing Telstra Corporation v Australis Media Holdings (Unreported, Supreme Court of New South Wales, McLelland CJ in Eq, 10 February 1997). Redactions of that kind lead to disputation and wastage of time and costs. In my view, the whole document should be produced unless there is prior agreement to the contrary or leave is given by the Court.

Conclusion

68    The parties should confer and provide draft minutes of orders reflecting these reasons within seven days.

Associate:

Dated:    1 November 2019