Federal Court of Australia

Clover Corporation Limited v Tobias (No 2) [2020] FCA 1710

ORDERS

THE COURT ORDERS THAT:

1.    By 4 December 2020, the respondents identify those documents referred to as “Listed Things” in the report of Mr Benjamin Gardiner provided to the parties on 4 October 2020 in respect of which they wish to claim legal professional privilege.

2.    By 4 December 2020, the respondents make any reasonable redactions to take into account claims of confidentiality in respect of the 1,247 documents identified by Mr Gardiner as Listed Things.

3.    By 9 December 2020, Mr Grant Whitely of KordaMentha provide the applicants’ solicitors with access to the documents referred to in paragraph 2 of these orders, save in respect of any documents the subject of a claim to privilege (pursuant to paragraph 1).

4.    Any documents that are redacted pursuant to paragraph 2 be accessed by the applicants’ solicitors pursuant to the confidentiality undertakings contained in the orders made on 18 March 2020.

5.    By 9 December 2020, the parties send to Mr Gardiner a joint communication requesting that he:

(a)    perform a further review of the 1,552 documents identified as “Not Clear”;

(b)    perform that review in accordance with paragraphs 3 to 9 of the protocol attached to the orders dated 24 June 2020; and

(c)    consult the Technical Expert as contemplated by paragraph 5 of the protocol if this would assist him to resolve the status of the documents,

and advising him that if he requires further technical assistance in order to resolve the status of the documents, the parties will confer as to how that assistance should be provided, and by whom.

6.    By 23 December 2020, the parties confer with the aim of resolving any objections to disclosure as referred to in paragraph 1, or agreeing upon a process to resolve them.

7.    By 22 January 2020, the applicants file and serve any reply to the respondents’ defences.

8.    The proceeding be listed for a case management hearing on a date to be fixed in February 2021.

9.    Liberty to apply.

10.    Costs reserved.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

O’CALLAGHAN J:

Introduction

1    In this proceeding, a large number of documents were seized from the respondents under a search order. They are now held by an independent third party on an electronic database.

2    The applicants’ lawyers have access to redacted versions of some of the documents. That position was reached more or less by agreement. The applicants now seek an order, over the objections of the respondents, that their lawyers be given access to unredacted versions of those documents, and to other documents that they have not yet inspected in any form.

Background

3    The applicants conduct a business that involves manufacturing, refining and selling ingredients for use in infant formula, supplements and children’s foods. They employed the first respondent (Mr Tobias) from around June 1994 to 28 August 2019. On 1 September 2019, Mr Tobias took up employment with the second respondent (Pharmamark), the applicants’ competitor.

4    The applicants commenced this proceeding on 21 November 2019. By their statement of claim dated 3 July 2020, they allege, among other things, that Mr Tobias has provided confidential information and assistance to Pharmamark in breach of various duties, and that Pharmamark has been complicit in these breaches. They seek, among other things, damages and an account of profits.

5    On the day that the applicants commenced the proceeding, they also applied for and obtained a search order against the respondents. The search order permitted a search party, supervised by an independent lawyer, to enter the respondents’ premises and to copy or seize certain “listed things”. The search party was to include independent computer experts (KordaMentha), who were permitted to make copies of the respondents’ computer hard drives and to search them for listed things. Where there was a dispute about whether some item was a listed thing, the independent lawyer was to hold it for safekeeping pending resolution of the dispute.

6    The “listed things” were set out in a schedule to the search order, as follows:

1.    Documents (whether in tangible and/or electronic form) recording or evidencing (in whole or in part):

   (a)    the applicants’ product formulations,

   (b)    the applicants’ manufacturing equipment,

   (c)    the applicants’ manufacturing specifications,

(d)    the applicants’ manufacturing processes (including processing steps and operating set points),

(e)    the applicants’ manufacturing equipment configuration, and

(f)    the applicants’ manufacturing control documents,

where that thing [is] related to the production of encapsulated oil powders (Applicants’ Confidential Information).

2.    External storage devices (including USB storage devices) on which is stored any document recording or evidencing (in whole or in part) the Applicants’ Confidential Information.

3.    Online storage services on which the Respondents have stored, or caused to be stored, any document recording or evidencing (in whole or in part) the Applicants’ Confidential Information.

4.    Any correspondence or communication in tangible and/or electronic form between [Mr Tobias] and any one or more of:

 (a)    [Pharmamark];

 (b)    Guy Drummond;

 (c)    Ravi Desu,

transferring, disclosing or otherwise communicating (in whole or in part) the Applicants’ Confidential Information.

5.    Online email accounts with any correspondence or communication between [Mr Tobias] and any one or more of:

(a)    Pharmamark;

   (b)    Guy Drummond; or

   (c)    Ravi Desu,

transferring, disclosing or otherwise communicating (in whole or in part) the Applicants’ Confidential Information.

6.    Documents, whether in tangible and/or electronic form, including plans, specifications, drawings or correspondence, in any way relating to the planning, design, construction or set up of:

(a)    a manufacturing plant of, or to be used by or on behalf of, Pharmamark; or

(b)    manufacturing equipment of, or to be used by or on behalf of, Pharmamark in a manufacturing plant,

which refer to or incorporate the Applicant[s’] Confidential Information.

7.    Documents evidencing the employment or other engagement of [Mr Tobias] by Pharmamark.

8.    Documents, whether in tangible and/or electronic form, which relate to or evidence any contract, arrangement or understanding between [Mr Tobias] and any one or more of:

(a)    Pharmamark; or

(b)    Guy Drummond; or

(c)    Ravi Desu,

in connection with the planning, design, construction or set up of:

(d)    a manufacturing plant of, or to be used by or on behalf of Pharmamark; or

(e)    manufacturing equipment of, or to be used by or on behalf of, Pharmamark in a manufacturing plant,

which refer to or incorporate the Applicant[s’] Confidential Information.

7    The search took place on 22 November 2019. Numerous documents were copied from the respondents’ computers. These were later uploaded onto a Relativity One database maintained by KordaMentha, where they remain.

8    On 6 December 2019, the court ordered that the applicants provide KordaMentha with a set of filtering criteria that would be applied to the seized documents. This produced an initial subset of documents for consideration. The respondents were then to identify any documents in the initial subset that they objected to the applicants inspecting.

9    On 18 March 2020, the court made orders by consent for the provision of documents between the parties on a confidential basis (the confidentiality regime). The orders relevantly provided as follows:

2.    Where in the course of providing:

2.1    a document under these orders or any other orders in these proceedings; or

2.2    any report, affidavit or statement filed or served in these proceedings,

a party (‘Disclosing Party’) provides to the solicitors of another party (‘Recipient Party’) any document which the Disclosing Party claims to be confidential and which is marked confidential (‘Confidential Document’), the solicitors of the Recipient Party must, unless the Court otherwise orders, keep that document and the information contained therein confidential in accordance with these orders.

3.    A Confidential Document, and the information contained therein, may only be disclosed:

3.1    to the Recipient Party’s solicitors and barristers who have signed a confidentiality undertaking in the form set out in Annexure A to these orders (‘Legal Representatives’);

3.2    to administrative staff of, and employed by, the Legal Representatives (provided the Recipient Party keeps a written register recording to which administration staff the document was disclosed, why and upon which date and for what purpose (marking in the register if the documents are copied, the particulars of the copying and to whom same were delivered));

3.3    to any other person, including any officer or employee of the Recipient Party, where the Disclosing Party gives permission in writing and that person has signed a confidentiality undertaking in the form set out in Annexure A to these orders;

3.4    to the Court; or

3.5    if required by law to do so upon giving prior notice in writing to the Disclosing Party.

4.    If the solicitors for a Recipient Party notify the Disclosing Party that the solicitors for the Recipient Party wish to provide a redacted form of a Confidential Document (that is, a form of the Confidential Document with the claimed confidential information redacted) to the Recipient Party, the Disclosing Party must also provide a version of the Confidential Document redacted by the solicitors for the Disclosing Party for that purpose within 5 business days of such notification and such redacted version form of the Confidential Document (having had claimed confidential information redacted) will not otherwise be subject to these orders.

5.    A Confidential Document, and the information contained therein, may only be used for the purpose of this proceeding.

6.    A Disclosing Party may not copy or reproduce, or permit the copying or reproduction of, the Confidential Documents or any part of them other than for the purposes of the conduct of this proceeding.

7.    If the Recipient Party asserts that the Confidential Documents and the information contained therein disclosed by the Disclosing Party are not confidential in whole or in part and wishes to deal with the documents or the information contained therein other than in accordance with the Orders, it should give notice to the Disclosing Party in writing of its intention to do so and if the Disclosing Party disputes that those Confidential Documents and the information contained are not confidential in whole or in part, the Recipient Party must comply with these orders until otherwise ordered.

8.    If the Confidential Documents are reproduced as exhibits or annexures to any report, affidavit or statement filed or served in these proceedings, they will be identified as confidential exhibits or annexures.

9.    If the contents of the Confidential Documents are referred to in written or in oral submissions, they will be identified as such to the Court.

10.    The Confidential Documents may only be put in evidence at trial on a confidential basis.

10    The pro forma undertaking in Annexure A to those orders provided as follows:

I, the undersigned, HEREBY GIVE THE FOLLOWING UNDERTAKING to [each of the parties and the court] in relation to any documents provided by a party (Disclosing Party) pursuant to [the confidentiality regime] (Confidential Documents) in Federal Court of Australia Proceedings No. VID1265/2019 (Proceedings):

1.    I will not, without the prior written consent of the Disclosing Party or their solicitors, disclose or permit to be disclosed the contents of any of the Confidential Documents, or any information contained in the Confidential Documents, other than in accordance with this undertaking.

2.    I will not, without the prior written consent of the Disclosing Party or their solicitors:

2.1    disclose any of the Confidential Documents, or any information contained in the Confidential Documents, except:

(a)    to administrative staff of, and employed by me or my firm;

(b)    to the Court; or

(c)    if required by law to do so; nor

2.2    use any of the Confidential Documents, or any information contained in the Confidential Documents, for any purpose other than this Proceeding;

2.3    copy or reproduce, or permit the copying or reproduction of, the Confidential Documents or any part of them other than for the purposes of the conduct of the Proceedings.

3.    Nothing in this undertaking is to restrict or limit otherwise permissible use or disclosure of any information which was within any person’s possession or knowledge prior to receiving a Confidential Document, or is publicly available.

4.    I will store the Confidential Documents and any copies or reproductions of any of the Confidential Documents, securely in such a way that persons to whom disclosure of these Confidential Documents is not permitted under clause 1 or 2 cannot obtain access to them.

5.    If any of the Confidential Documents, or any part of them, are required to be disclosed in the Proceedings or to the Court in any report, affidavit or statement, I will ensure that the Confidential Documents, or any part of them, tendered are included in an exhibit to such report, affidavit or statement marked or designated as ‘Confidential’.

6.    I will, at the Disclosing Party’s option, destroy or return to their solicitors the Confidential Documents and any copy or copies of the Confidential Documents in my possession within 21 days of such request following the final determination of the Proceedings (including, for the avoidance of doubt, any appeal).

(Numbering modified.)

11    Several lawyers acting for the applicants have since given undertakings in the form required by the confidentiality regime.

12    At an interlocutory hearing on 20 May 2020, the applicants sought an order that their lawyers be provided with access to certain documents within the initial subset (see [8] above), subject to the confidentiality regime. The applicants’ proposed orders placed the documents into six categories:

(a)    documents that Mr Tobias said he had disclosed to third parties (category A);

(b)    documents that Pharmamark accepted were listed things, but which were said to contain its confidential information (category B);

(c)    documents that Pharmamark accepted were listed things, but which were said to be irrelevant to the proceeding (category C);

(d)    documents that Pharmamark accepted were listed things, but which were said to contain its confidential information and to be irrelevant to the proceeding (category D);

(e)    documents that Pharmamark said were not listed things (category E); and

(f)    all documents in Mr Tobias’s list of objections that were not already in any of the other categories (category F).

13    The respondents accepted that the documents in categories A, B, C and D should be provided to the applicants’ solicitors, subject to: (a) the confidentiality regime, and (b) the respondents first making reasonable redactions to take into account claims of confidentiality. The applicants agreed to receive the documents on that basis in the first instance. On 29 May 2020, the court made orders accordingly. Since then, the applicants’ solicitors have reviewed the documents, but they say that the redactions are preventing them from properly assessing their contents.

14    The 29 May orders also required counsel to confer about inspection of the documents in categories E and F. This was to no avail. On 24 June 2020, the court ordered instead that the category E and F documents be provided to an independent expert, who, in accordance with a protocol proposed by the applicants, was to determine whether each document was: (a) a listed thing, (b) not a listed thing, or (c) not clearly either. The protocol provided as follows:

Appointment of expert

1.    The parties propose to appoint a legal practitioner (the Expert) for the purposes of providing a further review of the Category E Documents and Category F Documents (as defined in the Order of Justice O’Callaghan made 29 May 2020 (Orders)) (together, Determination Documents) to determine whether the Determination Documents are ‘Listed Things’ for the purposes of the Search Order of Justice Wheelahan made 21 November 2019 (Search Order).

Identity of Expert

2.    The Expert shall be chosen by the Applicants. The Expert shall be a practising barrister of no less than 10 years’ standing, specialising in commercial litigation, and shall be independent of the Applicants’ lawyers. The Applicants will notify the Respondents of the name of the Expert within one day of him or her being engaged.

Briefing material

3.    Within 7 days, the Applicants shall provide to the Expert a copy of:

3.1    the Search Order;

3.2    the material filed in support of the Search Order;

3.3    the Orders.

Provision of Documents in Categories E & F

4.    Within 2 business days of being notified of the appointment of the Expert, Grant Whiteley of Korda Mentha (Independent Computer Expert) shall provide access to the Determination Documents through the Relativity One database and web portal (Web Portal) to the Expert. The Expert may consult with, and obtain assistance from, the Independent Computer Expert at any time to assist in the efficient review of the Determination Documents, as the Expert sees fit.

Technical consultation

5.    Where the Expert is unable to determine the status of particular documents as a Listed Thing then the Expert may consult Mr Adam Tyson of Produco Ltd as an independent technical expert (Technical Expert). The details of Mr Tyson can be found at https://produco.co.nz/business-profile/.

Determination

6.    As soon as reasonably practicable after receiving the Determination Documents and meeting with the parties, the Expert shall provide a written report to each of the parties in which the Expert indicates:

6.1    which of the Determination Documents are Listed Things for the purposes of the Search Order;

6.2    which of the Determination Documents are not Listed Things for the purposes of the Search Order; and

6.3    for which of the Determination Documents it is not clear to the Expert whether the Determination Documents are Listed Things or not for the purposes of the Search Order.

General matters

7.    The Expert does not act as an arbitrator of the matters in dispute and the Determination is not an arbitration within the meaning of any law.

8.    The Expert shall keep all information disclosed during the Determination confidential, save as where appropriate that information may be revealed to the Court or, where it concerns confidential information of a party, then that information may be revealed to that party.

9.    The costs of the Expert, the Independent Computer Expert and the Technical Expert shall be paid by the Applicants and are reserved.

15    Pharmamark then filed an application for those orders to be stayed, and sought leave to appeal them. The stay application was refused with costs by O’Bryan J on 27 August 2020. See Clover Corporation Limited v Tobias [2020] FCA 1244. The application for leave to appeal was later abandoned.

16    Meanwhile, Mr Benjamin Gardiner of counsel was appointed as the independent expert. He reviewed the category E and F documents, and reported the results of his review to the parties by email on 4 October 2020. He identified 1,247 documents as listed things; 29,460 documents as not listed things; and 1,552 documents as not clearly either (the unclear documents). It is not readily apparent whether Mr Gardiner sought the assistance of the Technical Expert, Mr Tyson, in carrying out his review.

17    Mr Gardiner also noted in his email to the parties that he was open to providing further information or conducting further analysis if required, subject to the consent of the parties or any order of the court.

18    After the parties received Mr Gardiner’s report, the applicants’ solicitors wrote to the respondents, requesting that they be granted access to those documents that Mr Gardiner had determined to be listed things or unclear documents. The respondents refused that request.

Issues for determination

19    There are two issues that now fall to be determined, viz, whether the applicants’ lawyers should be permitted to inspect without redactions:

(1)    the documents in categories E and F that Mr Gardiner determined to be listed things or unclear documents (which they have not yet inspected); and

(2)    the documents in categories A, B, C and D (which they have already inspected in redacted form).

20    Before turning to each of those issues, I would make one general observation.

21    Each of the documents was seized under a search order. As paragraph 2.12 of the Search Orders Practice Note states, an applicant for a search order in the standard form is ordinarily not permitted to inspect seized documents without leave of the court. There are a number of authorities that bear on the question whether that leave should be granted. See, eg, Aristocrat Technologies Australia Pty Ltd v Global Gaming Supplies Pty Ltd [2006] FCA 1707 (Jacobson J); Metso Minerals (Australia) Ltd v Kalra (No 3) [2008] FCA 1201 (Flick J); Metso Minerals (Australia) Ltd v Kalra [2009] FCAFC 57 (Emmett, Jacobson and Perram JJ); Brooks Sports, Inc v Paul’s International Pty Ltd (No 2) [2011] FCA 1000 (Dodds-Streeton J); Lamond (No 4) [2017] FCA 820 (Besanko J); Findex Group Ltd v iiNet Ltd [2018] NSWSC 1567 (Ward CJ in Eq); Findex Group Ltd v McKay [2019] NSWCA 93 (Basten JA, Sackville and Emmett AJJA); Rauland Australia Pty Ltd v Johnson (No 2) [2019] FCA 1175 (Stewart J). Unfortunately, no party made their submissions by reference to these authorities.

Documents in categories E and F

Documents determined to be listed things

22    The applicants seek an order that their lawyers be permitted to inspect the documents that Mr Gardiner determined to be listed things. They submit that, even without redactions, Pharmamark’s confidential information will be adequately protected by the confidentiality regime. They accept that the respondents should first be given an opportunity to make claims of privilege, but they say that such claims should be made on a document-by-document basis and be supported by an affidavit. They say that this is necessary in circumstances where the respondents have wrongly maintained that documents were not listed things in the past.

23    The respondents are willing for the documents that Mr Gardiner determined to be listed things to be made available to the applicants’ solicitors under the confidentiality regime. However, they say that they should first have the chance to make redactions for confidentiality, and that their claims of privilege should not need to be supported by an affidavit.

24    Mr Tobias also submits that inspection of the documents should be made conditional on the applicants providing further particulars of their statement of claim. However, as I made clear at the hearing, any application for particulars or for striking out parts of the claim should be made separately, and with proper notice to the applicants.

25    Mr Tobias submits further that the search order must not be conflated with discovery, and that the court should not allow the applicants to “trawl” through the seized documents in order to “reverse engineer” their claim, citing Columbia Picture Industries Inc v Robinson [1987] Ch 38 (Scott J); Hytrac Conveyors Ltd v Conveyors International Ltd [1982] 3 All ER 415 at 416-417 (Lawton LJ); and Microsoft Corporation v Goodview Electronics Pty Ltd [1999] FCA 754; 46 IPR 159 at 164 [26] (Branson J).

26    I agree that it must be kept in mind that these documents were seized under a search order, the purpose of which is to secure or preserve evidence, not to be used as a “mere investigatory tool”. See Federal Court Rules 2011 (Cth) r 7.42; Rauland Australia Pty Ltd v Johnson (No 2) [2019] FCA 1175 at [45]-[47] (Stewart J), citing Microsoft Corporation v Goodview Electronics Pty Ltd [1999] FCA 754; 46 IPR 159 at 164 [26] (Branson J). Such an order does not ordinarily entitle an applicant as of right to access the seized documents for the purpose of prosecuting its case. See Bucyrus (Australia) Pty Ltd v ANI Mining Services Ltd [1999] FCA 1193; 45 IPR 643 at 647 [7]-[8] (Drummond J, Spender and Mansfield JJ agreeing); Findex Group Ltd v iiNet Ltd [2018] NSWSC 1567 at [123] (Ward CJ in Eq).

27    Nonetheless, the court may permit an applicant to inspect documents seized under a search order for certain purposes. In Metso Minerals (Australia) Ltd v Kalra (No 3) [2008] FCA 1201 at [28], Flick J considered that those purposes include “to ensure that the search order has been complied with”, and “to ensure that only evidence which should be preserved is in fact preserved pending the final determination of a proceeding”. His Honour went on to hold (at [36]) that, in the absence of consent, it would be wrong “to permit access to seized materials for the purposes of facilitating discovery or the provision of particulars, as opposed to preserving the continued existence of evidence”. See also Findex Group Ltd v iiNet Ltd [2018] NSWSC 1567 at [126]-[132] (Ward CJ in Eq); Findex Group Ltd v McKay [2019] NSWCA 93 at [26] (Basten JA, Sackville and Emmett AJJA agreeing). In Metso Minerals (Australia) Ltd v Kalra [2009] FCAFC 57 at [16]-[21] (Emmett J, Jacobson and Perram JJ agreeing), the Full Court added, by way of obiter, that the court might also exercise its discretion to allow an applicant to inspect seized documents: (a) in order to ensure that proceedings have been adequately prepared and proper discovery given, or (b) to allow an applicant to assess whether to expand its claims in respect of the prima facie case that gave rise to the search order, though not as a substitute for an application for preliminary discovery.

28    In Rauland Australia Pty Ltd v Johnson (No 2) [2019] FCA 1175 at [55], Stewart J reviewed those cases and said:

It is apparent from the above authorities that the Court has a discretion to order access to documents that have been preserved under a seizure order. In the case of access to the seized material for the purpose of formulating a claim, or as an aid to discovery, or to particularise a claim, that discretion may be exercised only in narrow circumstances. However, where parties have already furnished discovery and questions arise as to the adequacy of discovery or discovery has not produced the seized material (which is otherwise assumed to be relevant and not subject to a valid objection to production such as privilege), the discretion might be more readily exercised.

29    His Honour went on to say, in the circumstances of the case before him (at [56]):

In my view, this is not a proper case for the exercise of the discretion in favour of [the applicant], at least not at this stage. The pleadings have only recently closed. No party has yet made application for discovery from other parties to the proceeding. That is the obvious next step. It is only after the discovery process that it would be appropriate to reconsider whether there is a need for [the applicant] to have access to the material that is in the meantime being preserved under the seizure orders.

30    As I understand it, the applicants in this case seek to have their lawyers inspect the documents in categories E and F that Mr Gardiner determined to be listed things because, and only because, they think they will be relevant to their case. This places their application into the category of case where the discretion to allow such access should only be exercised “in narrow circumstances”, as Stewart J explained.

31    The applicants have not yet inspected these documents in any form – even the redacted form proffered by the respondents. Moreover, each party’s proposed orders contemplate the possibility of further pleadings in this proceeding. And no party has yet made any application for, or otherwise sought, discovery. In my view, this is not an appropriate time for the court to exercise its discretion to allow the applicants greater access to the seized documents than the respondents are willing to permit. For this reason, I will order that the documents that Mr Gardiner determined to be listed things be dealt with substantially in the manner proposed by the respondents. In doing so, I do not foreclose the possibility of revisiting the question if that course proves unsatisfactory.

Unclear documents

32    As to the unclear documents, the applicants submit that their lawyers should be able to inspect them because they are the persons who, through a combination of technical expertise and familiarity with the proceeding, are best placed to determine whether they are listed things. The applicants submit that this is the most efficient course and that further review by an independent person would be inefficient and repetitious.

33    The respondents submit that there is no principled basis upon which to give the applicants access to documents that may not even fall within the terms of the search order. Pharmamark instead proposed in oral submissions that they be provided to an independent technical expert, a process engineer, who could conduct a review akin to that conducted by Mr Gardiner.

34    I am not attracted to either proposal.

35    It was the applicants who proposed that an independent expert determine whether or not the seized documents fall within the terms of the search order. As Pharmamark submitted, it would seem unusual now to abandon that process by “leapfrogging” the independent expert and providing the unclear documents directly to the applicants’ solicitors. Equally, Pharmamark’s proposal to engage a new expert is likely to produce unnecessary controversy and expense. The preferable course, in my view, is to take up Mr Gardiner’s offer of further assistance, and to have the parties provide him with whatever technical expertise he requires to resolve the status of the unclear documents.

Redacted documents in categories A, B, C and D

36    Most of the documents in categories A, B, C and D that were provided to the applicants’ lawyers in accordance with the 29 May orders were redacted to varying degrees. The applicants’ solicitor, Mr Clark, deposes that the redactions have prevented him from properly assessing their contents.

37    In his affidavit, Mr Clark says that he has been unable to put the 435 redacted documents before the court because of the access restrictions placed on them in the Relativity One database, which prevent them from being downloaded or printed. Nonetheless, he describes the redacted documents by dividing them into three groups. Group one comprises 53 documents described as emails between Pharmamark and third parties or between Mr Tobias and Pharmamark employees. Group two is a single spreadsheet (Pharmamark now accepts that it should be provided in unredacted form, so there is no need to say anything more about it here). Group three comprises 381 documents described as “product formulation sheets”.

38    As to group one, Mr Clark says that “[t]he redactions to emails involve the redaction of all or a significant part of one or more emails in the chain of correspondence such that it is not possible to determine the overall content and circumstances of the communication in the email”. He describes two documents, by way of example. The first is an email chain, in which everything is redacted other than senders, recipients, dates and a reference to a document that is said to be attached to the email chain but is not identified by title. The second is an email from Mr Tobias to Pharmamark’s President and CEO, Mr Drummond, dated 12 June 2019 “in which Mr Tobias provides information in respect of the [applicants] to Mr Drummond while Mr Tobias was still employed by the [applicants]. The document includes the chain of correspondence to which Mr Tobias’ 12 June 2019 email responds”. Mr Clark says that “[i]t is not possible for [him] to determine the content or circumstances relating to these communications including what question or request this information is provided in response to”.

39    As to group three, Mr Clark says that “[t]he redactions made to product formulation sheets comprise wholesale redactions to the specific information of these documents”, but that the form of the documents “mimics the form used by the [applicants]”. He says that everything is redacted except for headers, footers and field names, and that it is thus “not possible for [him] to determine whether any information as to the product(s) the subject of those product formulation sheets may relate to the product formulations of the [applicants] or otherwise include manufacturing and / or confidential information of the [applicants]”.

40    The applicants submit that the redactions to the documents in categories A, B, C and D may conceal information that is relevant to the proceeding. They submit that it was made clear at the interlocutory hearing on 20 May (which precipitated the 29 May orders) that the redactions were being permitted “in the first instance”. They say that the respondents’ confidentiality will be adequately protected by the confidentiality regime (citing Kraft Foods Group Brands LLC v Bega Cheese Limited (No 3) [2018] FCA 1023 at [21]-[22]), the implied undertaking (citing Hearne v Street (2008) 235 CLR 125 at 158-160 [107] (Hayne, Heydon and Crennan JJ)) and the access restrictions placed on the documents in the Relativity One database in which they are stored.

41    Pharmamark, the party who made the redactions, opposes the documents being provided in unredacted form (other than in the case of the single spreadsheet mentioned earlier). It submits that the redactions are reasonable, and that releasing the documents in unredacted form to the applicants’ lawyers would not offer it adequate protection for its confidential information. To do so, it says, would be to relieve the applicants “of the exercise that they have been bound to perform from the outset, namely, to identify their confidential information and justify inspection of such information”. As with the unclear documents in categories E and F, Pharmamark proposes that the redacted documents be provided to an independent process engineer who, after being briefed by the parties, could determine whether the redacted information was confidential to the applicants, to Pharmamark, or to no one.

42    Mr Tobias, not having made any of the redactions himself, was largely content to support Pharmamark’s submissions on the issue.

43    The provision of documents to the lawyers of another party on a confidential basis is an orthodox approach where parties are trade rivals. See, eg, Mobil Oil Australia Ltd v Guina Developments Pty Ltd [1996] 2 VR 34 at 40 (Hayne JA, Winneke P and Phillips JA agreeing). It is orthodox because the effective operation of the legal system and the administration of justice depends upon the court accepting that responsible members of the legal profession will do as they say. See Kraft Foods Group Brands LLC v Bega Cheese Limited (No 3) [2018] FCA 1023 at [20]. The risk in this case of disclosure is further reduced by the access restrictions on the documents in the Relativity One database.

44    However, this is not a dispute about documents that have been discovered (as in Mobil Oil) or produced in response to a subpoena (as in Kraft). The documents were secured by the execution of the search order. It follows that the applicants require the court’s leave or the respondents’ consent to inspect them. Compare Mobil Oil Australia Ltd v Guina Developments Pty Ltd [1996] 2 VR 34 at 38 (Hayne JA, Winneke P and Phillips JA agreeing).

45    I do not think that, at this stage of the proceeding, prior to any application for discovery and with further pleadings in contemplation, it is necessary or appropriate to make an order allowing the applicants’ solicitors to have unredacted access to these documents over the respondents’ objections. I will not therefore, at least as things currently stand, make the order sought by the applicants in respect of the documents in categories A, B, C and D.

46    It follows that the applicants’ complaint that the documents in categories A, B, C and D are too heavily redacted to make sense of is an issue that also may be revisited at a later time, should it become necessary.

Associate:    

Dated:    27 November 2020