Federal Court of Australia

Australian Pacing Gold Ltd v Archibald Jeebung Butterfly [2022] FCA 879

ORDERS

THE COURT ORDERS THAT:

Until the end of the hearing on 1 August 2022, or until further order of the Court, and upon the applicant, by its counsel giving the usual undertaking as to damages:

1.    The respondent is restrained from publishing or republishing, or causing to be published or republished, any matter about the Applicant, or about any director or employee of the Applicant, which carries any of the following representations (or representations that do not differ in substance):

(a)    The Applicant's business is a Ponzi scheme;

(b)    The directors or employees of the Applicant are running a Ponzi scheme;

(c)    The Applicant misled buyers at its yearling sales as to the Applicant's ability to fund prizemoney for its race series;

(d)    The Applicant deceived buyers at its yearling sales as to the Applicant's ability to fund prizemoney for its race series;

(e)    The Applicant defrauded buyers at its yearling sales as to the Applicant's ability to fund prizemoney for its race series;

(f)    The Applicant misled its commercial sponsors as to its ability to conduct a race series;

(g)    The Applicant deceived its commercial sponsors as to its ability to conduct a race series;

(h)    The Applicant defrauded its commercial sponsors as to its ability to conduct a race series;

(i)    The Applicant's business is about to collapse;

(j)    The Applicant is insolvent;

(k)    The Applicant is on the brink of insolvency;

(l)    The Applicant has been trading while insolvent;

(m)    The Applicant is in significant debt;

(n)    Directors of the Applicant have misused company funds on personal expenses;

(o)    The Applicant has a corrupt relationship with Queensland Racing Integrity Commission stewards;

(p)    The Applicant improperly influenced Queensland Racing Integrity Commission stewards;

(q)    Employees of the Applicant have a corrupt relationship with Queensland Racing Integrity Commission stewards;

(r)    Employees of the Applicant improperly influenced Queensland Racing Integrity Commission stewards;

(s)    Dean Baring behaved improperly as the Marketing and IT Manager of the Applicant by selling his own horses in the 2022 APG yearling sale on the Gold Coast

(t)    The 2022 yearling sale conducted by the Applicant on the Gold Coast was unfair, because the Applicant's Marketing and IT Manager exploited his position to gain an unfair advantage as a vendor in the sale.

2.    The respondent is restrained from engaging in any conduct intended to intimidate or otherwise bring improper pressure to bear on the applicant and the applicant's lawyers in respect of the conduct of this proceeding.

3.    These orders do not restrain or otherwise prevent the respondent from publishing or causing to be published a fair report of this proceeding, or any hearing of this proceeding.

4.    The matter be listed for hearing as to whether these orders should continue at 10.15 am on 1 August 2022 at Brisbane before the Duty Judge.

5.    The hearing on 1 August 2022 will be held in person unless the Duty Judge hearing the matter orders otherwise.

6.    This Order is to be served on the respondent by:

(a)    email to peterprofitracing@gmail.com; and

(b)    by post to Suite 407, 5 Owen Street, Port Douglas, Queensland, 4877.

7.    Until the respondent files a notice of address for service, the service of other documents be effected by email to peterprofitracing@gmail.com.

8.    The applicant file and serve any further affidavits upon which it seeks to rely and an outline of submissions (not exceeding 7 pages) by 4.30 pm on Wednesday 27 July 2022.

9.    The respondent file and serve any affidavits upon which it seeks to rely and an outline of submissions (not exceeding 10 pages) by 4.30 pm on Friday 29 July 2022.

10.    The costs of the hearing are reserved.

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

REASONS FOR JUDGMENT

(DELIVERED EX TEMPORE AND REVISED FROM TRANSCRIPT)

RANGIAH J:

1    The applicant has brought proceedings seeking damages and permanent injunctions against the respondent for injurious falsehood. The application presently before the Court is for an urgent interim injunction restraining the respondent from publishing certain allegedly false representations and engaging in conduct allegedly designed to bring improper pressure upon the applicant and its legal representatives.

2    The applicant initially approached my Chambers seeking that the application for urgent relief be listed before me as Duty Judge on an ex parte basis and without the matter being published in the law list. I considered that such a course was inappropriate, and on 21 July 2022, ordered that the application for urgent relief be set down for hearing on 25 July 2022, and that the respondent be served at his email address. I did not require personal service as the respondent appears to reside in Far North Queensland and the hearing was claimed to be urgent.

3    The applicant conducts a business which involves selling horses in its own right and on consignment from vendors. The applicant also conducts an annual series of races, entry to which is restricted to horses sold in one of the applicant’s previous sales, and funds a pool of prize money for those races from the proceeds of the previous year’s sales.

4    The respondent is alleged to be the publisher of a website called Peter Profit, which comments on all aspects of racing, including harness racing. The website operates on a subscription basis and the articles are kept behind a paywall. Peter Profit is apparently widely read in the racing, horse breeding and horse training industries.

5    The applicant contends there is urgency in its application for interim relief because the respondent’s conduct creates an imminent and irreparable risk of discouraging buyers and sellers from participating in an important online auction to be conducted by the applicant, commencing on 27 July 2022.

6    The respondent objects that he has not had an adequate opportunity to respond, having been served with the material only on 21 July 2022. I appreciate the disadvantage that the respondent faces, particularly as a self-represented litigant, but am satisfied that there is an urgent need to consider the application for interim relief. The applicant has not, in my opinion, unreasonably delayed in making the application.

7    The applicant seeks interim injunctions to:

(a)    restrain the respondent from publishing certain representations about the applicant, its directors and employees, at least principally on the basis that those representations are injurious falsehoods; and

(b)    restrain the respondent from publishing matter calculated to bring improper pressure to bear on the applicant and its lawyers in the conduct of the proceeding.

8    For an interlocutory injunction to be granted, it is necessary for the applicant to demonstrate that:

(a)    there is a serious question to be tried, in the sense that the degree of likelihood of the applicant’s ultimate success is sufficient in the circumstances of the case to warrant intervention; and

(b)    the balance of convenience weighs in favour of granting an injunction.

See Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57 at [65] (Gummow and Hayne JJ).

9    The restraint exercised in the grant of injunctive relief in defamation cases does not apply, at least with the same force, in cases of injurious falsehood: Palmer Bruyn & Parker Pty Ltd v Parsons (2001) 208 CLR 388 at [58] (Gummow J); AMI Australia Holdings Pty Ltd v Fairfax Media Publications Pty Ltd [2010] NSWSC 1395 at [39]-[41] (Brereton J).

10    The elements of the cause of action for injurious falsehood are:

(a)    a false statement of or concerning the applicant’s trade, goods or business;

(b)    publication of that statement by the respondent to a third person;

(c)    malice on the part of the respondent; and

(d)    actual damage as a result of the publication of the statement.

See Palmer Bruyn & Parker Pty Ltd at [52] (Gummow J); Aldi Foods Pty Limited as General Partner of ALDI Stores (a Ltd Partnership) v Transport Workers’ Union of Australia [2020] FCA 269 at [146] (Flick J).

11    The applicant alleges that the respondent has published the following representations:

(a)    the applicant’s business is a Ponzi scheme;

(b)    the directors or employees of the applicant are running a Ponzi scheme;

(c)    the applicant misled buyers at its yearling sales as to the applicant’s ability to fund prize money for its race series;

(d)    the applicant deceived buyers at its yearling sales as to the applicant’s ability to fund price money for its race series;

(e)    the applicant defrauded buyers at its yearling sales as to the applicant’s ability to fund prize money for its race series;

(f)    the applicant misled its commercial sponsors as to its ability to conduct a race series;

(g)    the applicant deceived its commercial sponsors as to its ability to conduct a race series;

(h)    the applicant defrauded its commercial sponsors as to its ability to conduct a race series;

(i)    the applicant’s business is about to collapse;

(j)    the applicant is insolvent;

(k)    the applicant is on the brink of insolvency;

(l)    the applicant has been trading while insolvent;

(m)    the applicant is in significant debt;

(n)    directors of the applicant have misused company funds on personal expenses;

(o)    the applicant has a corrupt relationship with Queensland Racing Integrity Commission stewards;

(p)    the applicant improperly influenced Queensland Racing Integrity Commission stewards;

(q)    employees of the applicant have a corrupt relationship with Queensland Racing Integrity Commission stewards;

(r)    employees of the applicant improperly influenced Queensland Racing Integrity Commission stewards;

(s)    Dean Baring behaved improperly as the Marketing and IT Manager of the applicant by selling his own horses in the 2022 APG yearling sale on the Gold Coast;

(t)    the 2022 yearling sale conducted by the applicant on the Gold Coast was unfair because the applicant’s Marketing and IT Manager exploited his position to gain an unfair advantage as a vendor in the sale.

12    The respondent denies that he is the publisher of Peter Profit, but admits that he writes material appearing on that website. I am satisfied on a prima facie basis that the respondent is the publisher of the material appearing on the website. I am also satisfied that each of the representations alleged by the applicant were made in articles appearing on that website.

13    The applicant has produced evidence to demonstrate that the representations are false. That evidence includes financial statements for the applicant, indicating that the applicant is not insolvent or on the brink of insolvency. In addition, Mr Marshall, a director, and Mr Baring, a senior employee of the applicant, have directly sworn that the allegations made are untrue. I accept that the applicant has demonstrated a prima facie case that the representations are false.

14    It is necessary for the applicant to demonstrate malice on the part of the respondent. Malice is a question of motive, intention or state of mind and involves the use of the publication for some improper purpose or motive, such as to cause injury to another person: AMI Australia Holdings Pty Ltd at [31]. Malice may be proved by inference, and can be inferred from the “grossness and falsity of the assertions and the cavalier way in which they [are] expressed”, or from the respondent’s reckless indifference to the truth or falsity of what is published: AMI Australia Holdings Pty Ltd at [32]; see also National Roads and Motorists’ Association Ltd v Construction, Forestry, Maritime, Mining and Energy Union [2019] FCA 1491 at [193] (Griffiths J), and De Kauwe v Cohen (No 4) [2022] WASC 35 at [1213]-[1214] (Le Miere J).

15    The terms of the publications support an inference that the respondent has acted maliciously. They contain numerous snide insinuations concerning matters such as the supposed sexuality of Mr Marshall and the supposed circumstances in which he left his former job as a schoolteacher. There are insinuations suggesting a corrupt or improper relationship between the applicant and racing stewards. The articles convey a sense of the respondent’s personal enmity towards Mr Marshall and Mr Baring. The articles do not refer to any evidence supporting the representations complained of by the applicant. Although the applicant asserted that the information was provided by “sources” whose identity he was bound to protect, there is no reference in the articles to such sources. I am satisfied that the applicant has demonstrated a prima facie case of malice on the part of the respondent.

16    Mr Baring deposes that a major client, Mr Whitton, has informed him that a number of trainers will no longer be buying horses from the applicant because Peter Profit says that the applicant cannot fund the race series it has commenced, and they, accordingly, have reason to believe that the applicant will be folding soon and any race series attached to the 2023 Gold Coast sale will not happen. The respondent has produced a statutory declaration in which Mr Whitton denies that he said the main reason or only reason why trainers were losing confidence in the applicant was Peter Profit’s comments, and that there were other contributing factors. Nevertheless, the terms of Mr Whitton’s statutory declaration suggest that he told Mr Baring Peter Profit’s comments were a contributing factor towards the loss of confidence in the applicant. There is also evidence from Mr Baring that another major client has raised concerns regarding the applicant’s solvency as a result of “online publications”. I am satisfied that there is a reasonable probability that the applicant will suffer actual loss if injunctions are not granted: cf. Aldi Foods Pty Ltd v Transport Workers’ Union of Australia at [25].

17    I accept that the applicant has demonstrated a prima facie case of injurious falsehood.

18    On 16 July 2022, Ms Inglis, a lawyer representing the applicant, sent an email to the respondent requesting that he desist from publishing defamatory matter and requesting removal of previous publications. The respondent appears to have responded with a series of emails and publications, in which he made a number of aggressive and abusive comments about Ms Inglis. Amongst other things, the applicant wrote, “I owe you one, and I always pay”, and, “I hope you’re wearing your legal flak jacket”; referred to Ms Inglis as a, “snot-nosed, blonde Bond School yuppie”; wrote, “this is square up time”; described her as a, “jumped up yuppie with a heart as soft as stone”; and referred to her as a “Bond girl”, while attaching photographs of women in bikinis. The respondent referred to another lawyer, Ms Murray, acting for the applicant as a, “liar, deceiver and straight out bullshit artist”.

19    The respondent has also published a flurry of articles since being served with the application concerning the applicant, including articles entitled: “Oh Nurse! Help! I’m Shaking in My Boots!”, “My name is Dean Baring and I am a Dickhead”, and, “My name is Two Bob Rob, and I Am an Even Bigger One”.

20    In Barilaro v Google LLC [2022] FCA 650, a respondent uploaded a number of videos onto YouTube after proceedings had been commenced, which Rares J described at [184] as, “brazen attempts to bring improper pressure to bear”, on the applicant and his lawyers. His Honour, at [228], described one of the videos as, “a splenetic and vindictive public attack on each lawyer that was calculated to intimidate her and him from continuing to act…”. His Honour, at [407], referred the conduct of the respondent to the Registrar to consider whether to institute proceedings for contempt of court by bringing improper pressure to bear on the applicant and his lawyers not to pursue the proceeding.

21    In Kazal v Thunder Studios Inc (California) (2017) 256 FCR 90 the Full Court observed at [81]:

… It is not in doubt that bringing improper pressure to bear on a litigant can constitute a contempt of court, depending upon what has been done and when, especially as to the degree of connection with the proceedings and the likely impact upon them. It must be clearly shown that the matter published has “as a matter of practical reality, a tendency to interfere with the due course of justice” in the case at hand.

(Citations omitted.)

22    I am satisfied that the torrent of insulting and degrading language used by the respondent against the applicant and its lawyers presents a prima facie case that such conduct is designed to improperly dissuade the applicant from continuing with the proceedings and the applicant’s lawyers from acting for the applicant. I am persuaded to the standard of, “a strong feeling of persuasion”, that the conduct may, unless restrained, amount to a contempt of court: cf. Registered Clubs Association of New South Wales v Stolz (No 2) [2021] FCA 1418 at [158] (Yates J); Bastiaan v Nine Entertainment Co Holdings Ltd [2022] FCA 60 at [59]-[68] (Rares J).

23    It is necessary to consider whether the balance of convenience favours granting injunctions of the nature sought. The allegations made against the applicant are serious and substantial. I am satisfied that if injunctions are not granted, the applicant may suffer irreparable harm to its reputation. In addition, notwithstanding the respondent’s claims to the contrary, there is presently no evidence that the respondent could pay any damages awarded. It is necessary to recognise that there is a public interest in not unduly interfering with freedom of speech. Nevertheless, the respondent has offered no evidence in support of the truth of his serious allegations. In these circumstances, the balance of convenience favours granting of the injunctive relief sought by the applicant.

24    The injunctions will be granted for a period of one week, when the matter will be made returnable before the Duty Judge. The orders will not restrain the respondent from publishing a fair report of the hearing or the proceeding.

Associate:    

Dated:    28 July 2022