Ethicon Sàrl v Gill (No 2) - [2021] FCAFC 52

FEDERAL COURT OF AUSTRALIA
Ethicon Sàrl v Gill (No 2) [2021] FCAFC 52

File number: NSD 391 of 2020

Judgment of: JAGOT, MURPHY AND LEE JJ

Date of judgment: 12 April 2021

Catchwords:
REPRESENTATIVE PROCEEDINGS – proper form of orders in accordance with s 33ZB of the Federal Court of Australia Act 1976 (Cth) – order must describe or otherwise identify with precision group members who will be affected by such an order

COSTS – costs follow event – lump sum costs assessment appropriate if no resolution reached by parties

Legislation: Federal Court of Australia Act 1976 (Cth) s 33ZB

Cases cited:
Ethicon Sàrl v Gill [2021] FCAFC 29

Gill v Ethicon Sàrl (No 7) [2020] FCA 700; (2020) 146 ACSR 137

Division: General Division

Registry: New South Wales

National Practice Area: Commercial and Corporations

Sub-area: Regulator and Consumer Protection

Number of paragraphs: 11

Date of last submissions: 7 April 2021

Date of hearing: Determined on the papers

Counsel for the Appellants: B Walker SC and K Morgan SC with D Wong

Solicitor for the Appellants: Clayton Utz

Counsel for the Respondents: A Bannon SC with A Naylor, C Colquhoun and Z Hillman

Solicitor for the Respondents: Shine Lawyers

ORDERS

NSD 391 of 2020

BETWEEN:
ETHICON SÀRL

First Appellant

ETHICON INC

Second Appellant

JOHNSON & JOHNSON MEDICAL PTY LIMITED ACN 000 160 403

Third Appellant

AND:
KATHRYN GILL

First Respondent

DIANE DAWSON

Second Respondent

ANN SANDERS

Third Respondent

ORDER MADE BY:

JAGOT, MURPHY AND LEE JJ

DATE OF ORDER:

12 APRIL 2021

THE COURT ORDERS THAT:
1.The orders of the primary judge made on 6 March 2020 be varied by replacing the words:
(1)of order 1 with the following:
1AThe answers to the common questions identified on 6 March 2020 (common questions) are as specified in Schedule A to this order.
1BPursuant to s 33ZB of the Federal Court of Australia Act 1976 (Cth) all persons who were group members in the proceeding as at 6 March 2020 (other than any persons defined at that time as group members who had opted-out of the proceeding by that date) are bound by the answers to the common questions as specified in Schedule A to this order.

(2)appearing as the answer under “Q22: Why was the respondents’ conduct misleading or deceptive or likely to mislead and deceive?”, with the following:
In circumstances where: (a) the Ethicon devices caused the complications identified in the answer to common question 3 above; and (b) the respondents failed to disclose or make adequate disclosure of the matters identified in the answer to common question 18 above, throughout the period from the first supply in Australia of the Ethicon devices to 4 July 2017, the conduct of the respondents in the marketing and promoting of the Ethicon devices was conduct that was misleading and deceptive or conduct likely to mislead and deceive.

(3) The appellants pay the respondents’ costs of the appeal.
(4) Failing agreement between the parties within 21 days as to the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] FCAFC 52
Decision Date: 12 April 2021

CaseChat Overview and Summary

Ethicon Sàrl sued the Gills, who had purchased Ethicon surgical mesh devices, claiming that their conduct in marketing the devices was misleading and deceptive. The case came before the Federal Court of Australia, which was asked to determine the proper form of orders in representative proceedings and the appropriate assessment of costs in the absence of agreement between the parties. The Gills appealed against the orders made by the primary judge, arguing that the orders were not precise enough in identifying the group members who would be affected and that the costs should be assessed differently.

The court addressed the Gills' arguments concerning the precision required in the form of orders in representative proceedings under section 33ZB of the Federal Court of Australia Act 1976. The court found that the primary judge's orders were insufficiently precise and varied them to ensure that the group members who would be affected by the orders were clearly identified. The court also examined the issue of costs, noting that where the parties could not agree on the amount of costs, a lump sum costs assessment was appropriate. The court varied the orders to provide for such an assessment if the parties could not agree.

The court varied the orders to ensure that they met the precision requirement under section 33ZB and provided for a lump sum costs assessment if the parties could not agree on the amount. The court ordered that the answers to the common questions be specified in Schedule A to the order, and that all persons who were group members in the proceeding as at 6 March 2020, other than those who had opted-out, were bound by the answers to the common questions. The court also ordered that the Gills pay Ethicon's costs of the appeal and provided for a lump sum costs assessment if the parties could not agree on the amount within 21 days.

The final orders of the court varied the primary judge's orders to ensure that they were precise and provided for a lump sum costs assessment if the parties could not agree on the amount. The court also ordered that the Gills pay Ethicon's costs of the appeal. The orders were varied in accordance with Rule 39.32 of the Federal Court Rules 2011.

Orders

Orders of the court

1. The orders of the primary judge made on 6 March 2020 be varied by replacing the words:

(1) of order 1 with the following:

1A The answers to the common questions identified on 6 March 2020 (common questions) are as specified in Schedule A to this order.

1B Pursuant to s 33ZB of the Federal Court of Australia Act 1976 (Cth) all persons who were group members in the proceeding as at 6 March 2020 (other than any persons defined at that time as group members who had opted-out of the proceeding by that date) are bound by the answers to the common questions as specified in Schedule A to this order.

(2) appearing as the answer under “Q22: Why was the respondents’ conduct misleading or deceptive or likely to mislead and deceive?”, with the following:

In circumstances where: (a) the Ethicon devices caused the complications identified in the answer to common question 3 above; and (b) the respondents failed to disclose or make adequate disclosure of the matters identified in the answer to common question 18 above, throughout the period from the first supply in Australia of the Ethicon devices to 4 July 2017, the conduct of the respondents in the marketing and promoting of the Ethicon devices was conduct that was misleading and deceptive or conduct likely to mislead and deceive.

(3) The appellants pay the respondents’ costs of the appeal.

(4) Failing agreement between the parties within 21 days as to the amount of the costs payable pursuant to order 2, the costs be assessed on a lump sum basis and the issue of quantification be referred to a Registrar of the Court for assessment.

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

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

File number:	NSD 391 of 2020
Judgment of:	JAGOT, MURPHY AND LEE JJ
Date of judgment:	12 April 2021
Catchwords:	REPRESENTATIVE PROCEEDINGS – proper form of orders in accordance with s 33ZB of the Federal Court of Australia Act 1976 (Cth) – order must describe or otherwise identify with precision group members who will be affected by such an order COSTS – costs follow event – lump sum costs assessment appropriate if no resolution reached by parties
Legislation:	Federal Court of Australia Act 1976 (Cth) s 33ZB
Cases cited:	Ethicon Sàrl v Gill [2021] FCAFC 29 Gill v Ethicon Sàrl (No 7) [2020] FCA 700; (2020) 146 ACSR 137
Division:	General Division
Registry:	New South Wales
National Practice Area:	Commercial and Corporations
Sub-area:	Regulator and Consumer Protection
Number of paragraphs:	11
Date of last submissions:	7 April 2021
Date of hearing:	Determined on the papers
Counsel for the Appellants:	B Walker SC and K Morgan SC with D Wong
Solicitor for the Appellants:	Clayton Utz
Counsel for the Respondents:	A Bannon SC with A Naylor, C Colquhoun and Z Hillman
Solicitor for the Respondents:	Shine Lawyers

ORDER MADE BY:	JAGOT, MURPHY AND LEE JJ
DATE OF ORDER:	12 APRIL 2021