Abbott v Zoetis Australia Pty Ltd (No 2)

The case of Abbott v Zoetis Australia Pty Ltd (No 2) involved the applicant, Abbott, and the respondent, Zoetis Australia Pty Ltd, in a context of an open unfunded class action. The dispute centred on the respondent's application for security for costs in this representative proceeding, which was heard in the Federal Court of Australia. The application sought an order that the applicant provide security for the costs that the respondent may incur in relation to the proceeding.

The legal issues before the court involved the appropriate approach to be taken in determining whether security for costs should be granted in an open unfunded class action. The court had to consider the principles governing such applications, with a focus on the unique context of the litigation, including the nature of the class members and their likelihood of being willing to provide security. Additionally, the court needed to address the potential impact of the proposed process on the group members, who were entitled to take a passive role in the litigation until common issues were determined.

In delivering the judgment, the court emphasised the importance of a principled approach to such applications, highlighting that the characteristics of the group members and the intrusive nature of the proposed process were critical factors. The court noted that while it had the power to award security, the exercise of discretion should not lead to an order being made given the circumstances. The court considered that the proposed process was likely to be expensive and intrusive, potentially leading to the conclusion that the group members collectively had sufficient unencumbered assets. Consequently, the court dismissed the respondent's interlocutory application for security for costs.

The final orders of the court were that the respondent's application for security for costs be dismissed and that any application for costs in relation to the interlocutory application would be determined at the next case management hearing, where other issues such as finalisation of pleadings and the future progress of the proceeding would also be addressed.