A staggering 20,000 companies are part of the class action against Amcor and Visy over their involvement in a cartel that resulted in cardboard box prices being fixed.
Lawyers for the 20,000 customers appeared in the Federal Court in Melbourne for a pre-trial hearing, where both sides outlined their cases.
According to Maurice Blackburn lawyer Ben Slate, who is part of the team running the class action, yesterday’s arguments centred his firm’s attempts to get information about cardboard box prices before the cartel began, so that Maurice Blackburn’s experts can make an estimate of any overcharging that has occurred, and what damages will be claimed.
Slade says that the information provided so far from Amcor and Visy has been “patchy”. The two sides will return to court on 2 September to put forward further arguments over the damages issue.
But yesterday’s hearing involved some fiery debate which gave a preview of several of the key issues that are likely to decide the case.
The customers’ barrister, Tony Bannon, SC, told the court a key piece of evidence for his side will be a recording of a conversation between then Amcor executive Jim Hodgson and then Visy chief executive Harry Debney, in which the details of the cartel are discussed.
This tape was to be used in a separate case between Cadbury and Amcor, but this case was settled in early August, just before the trial began.
However, Slade says Amcor and Visy do not concede that price fixing even occurred.
“Visy’s lawyer said that even if there were high level discussions between Visy and Amcor they don’t accept that the discussion resulted in any giving effect from price fixing behaviour.”
This is despite the fact that in November 2007, the Federal Court handed down a record penalty of $36 million against Visy and its then-owner, the late Richard Pratt, after finding Visy had engaged in price-fixing and market-sharing arrangements with Amcor.
Slade says this decision did not involve an admission of guilt that can be used in other cases – and that means Amcor and Visy can ask the customers to prove the facts of the cartel all over again.
Yesterday’s heated debate might suggest that the case is unlikely to be settled, but Slade says that complex cases like this will often involved fiery court proceedings at the same time that behind-the-scenes settlement negotiations are taking place.
When asked if that is happening is this case, Slade replied: “Not yet, but we’re hopeful.”
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
