Filby v TEG Live Pty Ltd (No. 2)

[2023] NSWSC 327

Supreme Court

New South Wales

Medium Neutral Citation:

Filby v TEG Live Pty Ltd (No. 2) [2023] NSWSC 327

Hearing dates:

12, 13, 14, 15, 16, 19 September 2022

Date of orders:

3 April 2023

Decision date:

03 April 2023

Jurisdiction:

Equity

Before:

Slattery J

Decision:

Summons dismissed. Directions made for the hearing of any issues in relation to costs.

Catchwords:

EQUITY – Breach of Confidence – claim for breach of confidence – plaintiff attends business meeting in February 2013 in which he provides information to executives of the defendant about a marketing concept that might be used to promote the tour to Australia of the boy band One Direction – when the band tours Australia the defendant uses a marketing concept with features bearing resemblance to those explained by the plaintiff in the February 2013 meeting – plaintiff sues the defendant for breach of confidence and seeks an account of profits for the defendant’s use of the claimed confidential information – whether the information imparted by the plaintiff to the defendant’s executives qualifies as confidential information – whether the information was imparted in circumstances importing confidentiality – whether the defendant used the information – whether if the plaintiff’s case is otherwise made out, the defendant should account to the plaintiff for any profits it made from its use of the information.

Cases Cited:

Coco v AN Clark (Engineers) Ltd [1968] 1A IPR 587

Filby v TEG Live Pty Ltd [2022] NSWSC 1280

Moorgate Tobacco Co Ltd v Phillip Morris (No. 2) (1984) 156 CLR 414

Optus Network Pty Ltd v Telstra Corp. Ltd (2010) 265 ALR 281

Category:

Principal judgment

Parties:

Plaintiff: Mark Filby
Defendant: TEG Live Pty Ltd

Representation:

Counsel:
Plaintiff: C. Hart
Defendant: C. Gleeson

Solicitors:
Plaintiff: Sean Patrick Keleher, Keleher Lawyers
Defendant: Anna Ross, Corrs Chambers Westgarth

File Number(s):

2019/61650

Publication restriction:

No

Judgment

1. In October 2013 One Direction, an English Irish boy pop band, performed a sell-out tour across Australia. In February that year Mr Mark Filby discussed a marketing concept for the upcoming tour with Mr Geoff Jones, the CEO of the tour promoter, Nine Live Pty Ltd, which was then a subsidiary of Nine Entertainment Co Pty Ltd, and is now known as TEG Live Pty Ltd.

2. Mr Filby’s concept in cameo was this: Nine Live would partially offset its financial outlays on the One Direction tour by arranging the band to perform an extra concert at a Nine Live owned venue; this concert would be “free” to concertgoers, who had purchased certain lines of merchandise from retail chain outlets, qualifying them to enter a lottery for concert tickets; lottery draw winners could attend the extra concert; and the retail chain would more than cover the concert costs by paying Nine Live to use the One Direction tour in its marketing strategy campaign covering the qualifying merchandise.

3. The outlines of this concept were much debated in these proceedings. But its indisputable core was One Direction performing at an additional concert which would be attended by the lottery-winning purchasers of qualifying merchandise from a major retail chain. In their 2010 – 2016 life cycle, One Direction fans commonly referred to them as “1D”. In these reasons, for convenience, Mr Filby’s concept will be described in brief for convenience as “the 1D extra concert” concept, or idea.

4. The February 2013 meeting was arranged to talk about a different marketing idea of Mr Filby’s called “Cashtime”. Mr Filby says that at the meeting he and Mr Jones spoke about the 1D extra concert as a preliminary to Mr Filby’s presentation about Cashtime to a group of Nine Live executives.

5. Nine Live’s actual mid-2013 promotion, arrangement and execution of the One Direction tour resembled the 1D extra concert idea in important respects. Nine Live contracted with a major retail chain, Coles, for a substantial fee payable to Nine Live to allow Coles to run a multiproduct advertising campaign incentivising Coles customers to purchase specified Coles merchandise lines that qualified the customers to enter a draw to attend a One Direction concert without paying an extra ticket charge. One Direction toured Australia to overflow audiences. The tour included a special concert at Allphones Arena in Sydney; a venue owned by Nine Live’s related companies, at which tickets were issued to the Coles customers who had purchased qualifying merchandise and Coles stores and been successful in a lottery draw.

6. Mr Filby now contends as plaintiff in these proceedings that the 1D extra concert idea was his confidential information, that he imparted this concept at the February 2013 meeting to Nine Live executives in circumstances that imported its confidentiality, that Nine Live subsequently misused the information and that he is now entitled to an account of profits for Nine Live’s breach of confidence and misuse of this confidential information.

7. Nine Live contests Mr Filby’s case on several grounds. It contends: that the 1D extra concert idea does not have the characteristics of confidential information; that it was not imparted by Mr Filby or used by Nine Live; that if it was imparted to Nine Live it was not imparted in circumstances of implying confidentiality; and, even if a breach of confidence is made out against it, an account of profits is not warranted as the market value of the 1D extra concert idea was minimal.

8. This is the Court’s principal judgment in these proceedings. The Court delivered a procedural judgment before the commencement of the hearing in which the Court dealt with an application for a Nine Live executive, Mr Geoff Jones to give evidence by audio-visual link: Filby v TEG Live Pty Ltd [2022] NSWSC 1280. This judgment should be read with the Court's previous judgment. Events, matters and persons are referred to in both judgments in the same way.

9. As is explained below substantial changes have been made since 2013 to the corporate structure of Nine Live Pty Ltd (referred to throughout these reasons as Nine Live) and it and its associated companies have been renamed since then. Those subsequent corporate changes are not relevant to the issues in these proceedings. In these reasons all the corporate entries are referred to by their 2013 titles.

10. Mr C. Hart, instructed by Sean Patrick Keleher of Keleher Lawyers, appeared for the plaintiff. Ms C. Gleeson, instructed by Anna Ross of Corrs Chambers Westgarth, appeared for the defendant. In well-prepared cases the Court was much assisted by counsel and solicitors on both sides. Although it took nine years for these proceedings to come on for hearing that extensive delay was not attributable to the present lawyers for the plaintiff or the defendant.

11. These reasons will shortly commence with a narrative of the Court’s findings. That narrative is underpinned by the Court’s assessment of the credibility of parties and witnesses, which is dealt with first.

Credibility of Parties and Witnesses

12. Mark Filby. The plaintiff, Mr Mark Filby, was an unusual witness. In a moment of clarity, he offered a screenshot of his own style of giving evidence, declaring, “I am very hard on doing short answers”. At another time he said, “I was a retail man through and through and you don’t lose it”. His responses to questions tended to fly from one subject to the other, as he was gripped by different enthusiasms. Mr Filby could become carried away by his own ideas in ways that did not always anchor him firmly to well accepted facts. Mr Filby was conscious of and confident in his creative marketing abilities. But this led to him giving at times unself-consciously inappropriate or unusual responses to questions.

13. Mr Filby had a reasonably accurate recollection of some of his interactions with the Nine Live executives in February 2013. He seemed genuinely wide-eyed by the situation in which he found himself speaking directly to as senior an executive of Nine Live as Mr Geoff Jones and the occasion certainly made an impression upon him, embedding some memories of the event.

14. But he gave evidence in September 2022 after having had a long period to dwell upon his perspective of a single meeting in February 2013. This resulted in him convincing himself in places of the accuracy of his account of events. Moreover, he had available to him throughout this period information about the marketing campaign that Nine Live did conduct with Coles for the 2013 One Direction tour and it is likely that some of that information over time has informed his recollection of the meeting.

15. Mr Filby’s account of the February 2013 meeting was accurate in some limited but important respects. But the Court does not fully accept his detailed evidence about what was said. Both his evidence and indeed his litigation were coloured by a strong sense of betrayal by the executives of Nine Live, who he came to believe over time had misused information that he had given them on a confidential basis.

16. But Mr Filby’s style of jumping around from subject to subject in speech was not just a feature of his evidence. He participated in meetings the same way, entertaining possibilities rather than teasing out the ordered and concrete application of his ideas. This had a business disadvantage for him. More focussed and strategic businesspeople tended to look at him as commercially naïve and tire of him in time, because of his inability to define clear waypoints to a defined business destination. This is a most important feature of Mr Filby’s personality which was in play at the February 2013 meeting and explains some of the dynamic on the day and in the months thereafter.

17. Morris Maroon. Mr Morris Maroon is a principal of the Sydney law firm, Colman Greig. He has long valued Mr Filby’s creative ideas and from time-to-time attends meetings with Mr Filby to provide support as required. He is not and has never been a formal legal adviser to Mr Filby but he fulfils the role more of a mentor in relation to Mr Filby. He attended the meeting on 26 February 2013 at Nine Live’s offices and gave evidence in relation to a few other conversations with Mr Filby at crucial times. He had a limited recollection of the February 2013 meeting. He was a witness of credit but the Court does not fully accept his account.

18. Mr Rick Hoffman. Mr Rick Hoffman is a telecommunications sales and marketing consultant who worked with Mr Filby in 2012 and 2013 on the Cashtime concept and who also became an investor in the concept at Mr Filby’s invitation. He attended several meetings with Mr Filby and Mr Maroon and representatives of Nine Live in 2013. He was very briefly cross examined on his affidavit evidence and his credit was not seriously put in issue. His evidence is accepted as far as it goes. But the meeting with Nine Live executives to which his evidence relates is obscure and is not the contentious February 2013 meeting.

19. Peter Wiltshire. Mr Peter Wiltshire was the chief revenue officer and director of sales and marketing at Nine Entertainment Co Pty Ltd (also sometimes referred to in these reasons as “the Nine Group”), between November 2011 and May 2016. He left the Nine Group in 2016 and since then has worked in executive and non-executive senior consulting positions. He founded his own marketing and sales agency in Australia and New Zealand in 2017, which he still operates.

20. Mr Wiltshire had a reasonable recollection of events in which he was involved in 2012 and 2013 in relation to the promotion of the 2013 One Direction tour of Australia. He drew upon actual recollections though he was prepared to concede the limits of those recollections. Mr Wiltshire was reluctant to accord any credit to Mr Filby for new ideas. The Court regards his account as generally reliable.

21. Kelvin Kirk. In 2013 Mr Kirk was the general manager of Nine Rewards Pty Ltd (now known as “TEG Rewards Pty Ltd”), which like Nine Live was then a subsidiary of Nine Entertainment Co Pty Ltd. He served in that role continuously between September 2010 and September 2016. Since leaving TEG Rewards he has acted in other senior executive roles and has been operating a consultancy business since 2018.

22. Mr Kirk was a credible witness. He presented to the Court as professional, thoughtful, and clear in giving evidence. He stated the limits of his recollection and gave reasons why he believes certain things were not said at the critical February 2013 meeting. He was prepared to acknowledge that he was unsure about some of the detail covered at this meeting.

23. Marius Els. Mr Marius Els is a music promoter and has been a director of Artists Network Pty Ltd since 2010. He professed very little independent recollection of the meeting on 26 February 2013 and the events surrounding it. He was able to give some helpful evidence about components of the meeting. His evidence about the meeting and other matters is mostly accepted.

24. The fact that Mr Els had some real recollection of the February 2013 meeting emerged more in cross-examination than from his limited statement in chief. He had been subpoenaed to give evidence as he had for a long time been unwilling to provide a statement. He was very clear about the limits of his recollection and was not prepared to be drawn beyond those limits.

25. In evidence, and the Court infers in business, Mr Els was astute, diplomatic, and measured. He was unfazed by business negotiations and business meetings, showing a ready mastery of the nuances of the February 2013 meeting, which he had orchestrated, because he thought that Mr Jones and Mr Filby might benefit from meeting one another. He was conscious that some businesspeople tended to treat Mr Filby with condescension. But Mr Els thought that was unwarranted and that Mr Filby had good ideas that deserved a fair hearing. He was a good judge of the different personalities coming to the February 2013 meeting. He well understood the personality gulf between Mr Jones and Mr Filby and the risk of misunderstanding between them but because of that he was their ideal interlocutor.

26. After February 2013 Mr Els’ faith in Mr Filby and his ideas was tested. In the ensuing months Mr Els lost his limited appetite for dealing with Mr Filby’s often undisciplined flow of ideas. As time went by Mr Els distanced himself from Mr Filby, having become disenchanted with Mr Filby’s operating style.

27. Geoff Jones. At the time of giving evidence Mr Geoff Jones was the CEO and director of TEG Pty Ltd, the holding company of the defendant, TEG Live Pty Ltd. Between 2011 and September 2015 he was the Managing Director of Events of Nine Live. He attended the critical meeting on 26 February 2013 with Mr Filby. Mr Jones was a perceptive and confident business figure who was practised at evaluating the prospects of new business ideas. He was a sophisticated business operator and could make up his mind reasonably quickly whether he was interested in a commercial concept or not.

28. Mr Jones professed to have little memory of his conversations with Mr Filby at the February 2013 meeting although he was prepared to deny that certain things were said at the meeting. His professed lack of recollection was genuine. He gave an honest account of his recollection and its limits. A limited recollection was not at all surprising given the intensity of his business life at the time and since.

29. Brian Walker. Mr Filby called expert evidence from Mr Brian Walker, of the Retail Doctor Group. His specialty as CEO of that group was creating tailormade strategies and practices for retail businesses, including through the assessment of a business and its position in the global marketplace, branding and strategy and economic forecasting.

30. Mr Walker was an insightful witness into retail marketing and was able to provide reasoning supporting the expert opinions that he offered. He was thoroughly tested in cross-examination by Ms Gleeson but his expert opinions were unshaken. He undertook thorough research whilst conceding some of its limitations. He had an excellent grasp of the subtle distinctions between old ideas and new combinations of old ideas. The Court found his evidence helpful. But the Court’s findings mean that his evidence is of limited use.

31. The following is a narrative of the relevant history. This narrative represents the Court’s findings on the matters covered, except to the extent that the context indicates that only the parties’ allegations are being recorded in these reasons. For reasons of economy this narrative does not include reference to versions of the facts that have been rejected.

32. A theme common to many contests about the misuse of confidential information emerges from the narrative below: the interplay between synthetic and analytic thinking. Mr Filby does not reason in straight lines. He is a synthetic thinker, attempting to weave new information from often commonplace components. But the law of confidential information reasons analytically, controlling what may qualify as synthetic information and how it may be used.

Promoting the One Dimension Tour of Australia – 2012 to 2013

The 2013 Structure of the Nine Group

33. Nine Live was a subsidiary of Nine Entertainment Co Pty Ltd in 2013. Between 2013 and 2015 the Nine Entertainment Co Pty Ltd operated in three divisions. These were the following:

1. Nine Network Australia Pty Ltd, which operated Nine Entertainment Co’s broadcasting channels through its national free to air television network and affiliate arrangements;

2. Nine Events was Nine Entertainment Co’s events and entertainment business which included Ticketek, Nine Live and Nine Rewards, and

3. Nine Digital and Ventures, which operated Nine Entertainment Co’s online and digital platforms including Mi9 and NineMSN and it was also responsible for some smaller investments.

34. The narrative in these proceedings principally concerns the Nine Events subsidiaries of Nine Entertainment Co, with principal emphasis on the defendant, Nine Live. In transactions which are not relevant to these proceedings the Nine Group was acquired and held between 2015 and 2019 by a private equity group, Affinity Equity Partners. Nine Live, now TEG Live is a fully owned subsidiary of Ticketek, which is in turn a fully owned subsidiary of TEG Pty Ltd, which was acquired in 2019 by another private equity group, Silver Lake Partners.

Mr Filby’s Expertise and the Cashtime Concept

35. The February 2013 meeting before One Direction’s Australian tour brought together an experienced group of experts and executives. The exchanges at the meeting reflected their backgrounds, and in Mr Filby’s case, reflected ideas he had developed in the two years leading up to the meeting.

36. Mr Filby has an extensive career in retail marketing with an emphasis on live entertainment in a retail context. He has been involved in organising live and free entertainment for marketing in the retail industry since about 1988. In that year he became the marketing manager of Westfield, in the Sydney suburb of Liverpool and in the following year he became the National Special Projects Manager at Westfield. He arranged “live and free” events at various Westfield locations in those roles. These events included the Sydney to Melbourne Marathon which commenced at Westfield Liverpool and Street festivals in the Sydney suburb of Hurstville in the early 1990s.

37. In 1991 he acted as executive producer of the “Aussie Gold” CD which was used for fundraising for the Australian Paralympic team attending the 1992 Paralympics in Barcelona. The same year he arranged the Darling Harbour Carnivale, which was a joint venture between Westfield and the New South Wales Government.

38. In 1993 he left Westfield and commenced working as an independent contractor. In that role he organised the Royal Christmas show at the Sydney Showgrounds on behalf of the Royal Agricultural Society. For the next 10 years between 1993 and 2004 he continued to arrange “live and free” concert events in conjunction with people involved in the music industry, including Mr Steve White who had been tour manager for several internationally recognised bands, including Police and the Little River Band.

35. Between 2004 and 2011 Mr Filby was less active in the retail entertainment industry but was considering his options for future business ventures.

36. From his years managing live and free concerts Mr Filby had become friendly with the Australian singer Mr Jimmy Barnes and his wife Jane. In 2011 – 2012 Mr Filby was provided with office accommodation at their home and worked informally on a project he was developing, which became known as “Cashtime”. With encouragement for his ambitions from the music producer and promoter, David Jacobson and a friend, Richard Binns, Mr Filby developed the Cashtime business venture and eventually set up a company, Cashtime Pty Ltd (“Cashtime Co.”) with Mr Binns as a co-shareholder.

37. What was Cashtime? In Mr Filby’s telling it was a totally new concept to engage customers and products by continuous prizes of cash and members products in a way that benefits the product makers, the retailers, and consumers. In its public face Cashtime was designed to be presented on a live TV game show that was continuously giving away prizes, which shoppers could access by purchasing thousands of specially tagged products and services in participating retail stores and from participating businesses throughout Australia. Cashtime allowed customers who bought the tagged products to win prizes and for retailers and brand and product owners to generate more sales. Cash time is described in more detail later in these reasons under the heading “Mr Filby Considers His Options”.

38. The issues in these proceedings do not require the economics of Cashtime to be evaluated. But Mr Filby propounded a Cashtime model based on at least 3000 retailer/manufacturer members providing upfront registration and booking fees to the Cashtime operator. Then the retailer/manufacturer members would be required to remit to the Cashtime operator weekly fees of $710 charged per participating product or service to fund the prize pool and the operating costs of Cashtime.

39. In 2012 and until April 2013 Cashtime Co. operated out of commercial premises in the Sydney suburb of Gladesville. Mr Filby judged that to get the Cashtime concept moving that he needed a media partner. In February 2012 he approached WIN TV, then an affiliate of the Nine Television Network, also referred to in these reasons as “Channel 9”. At a meeting that month WIN TV executives gave Mr Filby a letter confirming, in Mr Filby’s words “that they would not steal any of the ideas of the Cashtime concept”. The WIN TV executives also promised to put Mr Filby in touch with the sales director at the Nine Television Network, although as will be seen, Mr Filby himself ultimately took the initiative to contact Channel 9.

40. 2012 became a busy year for Mr Filby in developing the Cashtime concept. He dealt with IT consultants to create a computer system to run Cashtime. He engaged lawyers to formalise contracts with small investors in Cashtime Co. and outlaid funds to create a website. Mr Filby remained in communication with WIN TV executives, and he engaged an advertising agency, Frontier Advertising to prepare presentations of the Cashtime concept. David and Kevin Jacobsen on behalf of Jacobson Productions offered to take a controlling interest in Cashtime Co. but the terms were not commercial, and Mr Filby let the offer lapse.

41. Trying to launch Cashtime had become a dominating theme in Mr Filby’s life by the second half of 2012 and early into 2013. By October 2012 Mr Filby realised in discussions with Mr Neil Hoare of Frontier Advertising that Cashtime Co needed a media partner to launch the Cashtime concept. That month he met Mr Ian Sheppard, the Sales Director at Nine Entertainment. Mr Shepherd appeared to view the Cashtime concept positively and recommended to Mr Filby that he should meet with Mr Peter Wiltshire, Channel 9’s marketing director.

42. At first Mr Wiltshire was slow to respond, so Mr Filby tried to approach him through back channels to Nine Network executives. Once the Jacobsons had abandoned commercial interest in Cashtime, Mr Filby felt free to contact another agent and touring promoter with similar skills, Mr Marius Els of Artist Network. Mr Els attended a presentation of the Cashtime proposal at PwC, after which he recommended that Mr Filby meet Mr Geoff Jones at Nine Live. Mr Filby was very keen to take this advice, as he was yet to find a media partner for Cashtime.

Mr Els Makes the Approach – Early to Mid-February 2013

47. Mr Els followed through. He thought it worthwhile for Mr Jones to see the Cashtime proposal. Sometime in November or December 2012 he began contacting Mr Jones to set up a meeting which ultimately took place on 26 February 2013.

48. On 5 February 2013 Mr Els emailed Mr Jones pitching the Cashtime concept in summary to him and asking for a face-to-face meeting. Mr Els and Mr Jones had limited written contact before this meeting. This first email is important in framing the expectations of both sides of the meeting on 26 February. Mr Els said to Mr Jones in the email:

“Hi Geoff,

I have an opportunity for Channel 9 that will nett a minimum of $12 million per annum in advertising revenue and would

like 30 minutes to present the concept with Mark Philby the creator, Manoj Santiago from Price Waterhouse Coopers Global and myself.

In brief - we are looking for a media partner that will generate immediate income for all involved.

We have budgeted a $12 million spend on either Gem, Go or a Data channel with a further $10 million contingency for TV.

An additional $2.8m spend for MSN and CUDO.

We have spent the past 9 months working with Price Waterhouse Coopers who have tested every level of the figures and this is 100% proof. PWC will manage the Cashtime project and now time to include a media partner.

This is an unprecedented TV offer for a network in Australia and no media group has yet seen this proposal. I have told the others we should present to u first as I believe it's a prefect fit.

I have attached a copy of a brief presentation to give u an overview. Thanks Geoff - we are available this week if u can find 30 minutes. Look forward to hearing from you.

Cheers Marius Els

Ceo

Artist Network Australia”

49. Mr Els attached to this email a 17-page PowerPoint presentation summary of the Cashtime concept entitled “Cashtime and Channel 9”. This presentation opened with unselfconscious hyperbole, the first page describing its contents as “an exclusive partnership unprecedented in media history”. The same day Mr Jones referred Mr Els’ email to Mr Kirk, to “let me know what it is about?”

50. Mr Kirk responded within a day to Mr Jones’ referral of the Cashtime concept to him, saying:

“I have reviewed the document and to be honest I don’t understand the consumer value [proposition] and how it will work? They have left out some core information. I am happy to meet on your behalf to get a better understanding if that works for you”.

51. The Cashtime PowerPoint is not easy to understand, at least to the lay reader. But it appeared to represent the essential features of Cashtime that are described later in these reasons.

52. Mr Els followed up his email to Mr Jones with both a voicemail message and a further message left with Mr Jones’ secretary. Mr Jones did not get back to Mr Els immediately, frustrating Mr Filby somewhat. Mr Els attempted to lower Mr Filby’s expectations of a quick response. In the meantime, Mr Filby was developing updated presentations for Cashtime.

53. Mr Jones finally replied to Mr Els on 15 February, apologising because he had been away in Dubai the previous week and indicating his secretary would set up a 30-minute meeting for he and Mr Kirk to “see Cashtime”.

54. Mr Els had pledged his reputation to secure this meeting. He had done so because of his own personal belief in Mr Filby and his conviction that Mr Filby’s ideas were creative and deserved a fair hearing. But Mr Els was insightfully conscious that not everyone saw Mr Filby as optimistically as he did and that he and Mr Filby must be seen to be coming to the meeting from a position of maximum credibility.

55. Mr Els already had a well-established reputation with Mr Jones. But Mr Filby was still an unknown to Mr Jones. Mr Els consulted with Mr Filby about getting the right people to the meeting to advance the most positive impression on behalf of Mr Filby in the moment. Mr Els was told on 18 February that the meeting could take place the following Tuesday, 26 February at 11am in Mr Jones’ city office. As well as communicating that, Mr Els said to Mr Filby:

“Can you get back to me ASAP but important we get the right people there so Monage would be important to give us some cred”

56. Both Mr Filby and Mr Els were conscious that together they would only have about half an hour to make an impression on Mr Jones. Using such a short period wisely was important. The dynamic of the early part of the meeting should be analysed with this in mind.

57. Consistent with this theme of Mr Els preparing Mr Filby to cut through to Mr Jones at the meeting, on the day before the meeting, on Monday 25 February Mr Els emailed Mr Filby suggesting that Filby “may want to do a bit of research on Geoff” and attaching information about Mr Jones’ professional background.

58. Mr Jones’ professional background suggested that he would scrutinise the Cashtime pitch from Mr Filby and Els carefully.

Mr Jones’ Professional Background

59. In February 2013 Mr Jones was managing director of Nine Entertainment Co. Events. In this role he had responsibility for several divisions of Nine Entertainment Co., namely Ticketek, Softix, Allphones Arena, Nine Rewards and the company organising events and performances for the Group, Nine Live. In his early career Mr Jones was an officer in the Australian Army, retiring at the rank of Lieutenant Colonel. Upon leaving the military from 1997 he worked in various marketing and executive roles for IMG, an entertainment media and sports conglomerate. He was with IMG for five years from 1997 to 2002. Between 2002 and 2005 he worked as a senior executive at Fosters Brewery and Carlton and United Breweries “(CUB”) in various marketing roles.

60. In 2007 he became Chief Executive Officer of Ticketek until 2010, when he became a partner/director of Sports & Entertainment Ltd (“SEL”), an Australian sports and entertainment corporation. From that role he returned to become the Managing Director of Nine Entertainment Co.

The 26 February 2013 Meeting

61. The contentious meeting at the centre of these proceedings took place at Channel 9’s then city office in Goulburn Street in Sydney’s CBD. Present at the meeting were Mr Geoff Jones, the general manager of Nine Live, Mr Kelvin Kirk, the general manager of Channel 9 Rewards, and Mr Marius Els, Mr Dipen Patel, and Mr Filby.

62. Mr Filby gave the following account of the course of the meeting. As is explained below, the Court does not accept much of Mr Filby’s account. Mr Filby says that Mr Jones raised the subject of the One Direction tour as one of the first subjects at the beginning of the meeting. He says that the following exchange then occurred between the pair.

“Mr Jones:    Mark, what I am interested in is, with your experience, how you would go about underwriting a national tour of a band like One Direction.

We have got One Direction coming out this year and it is costing the board $9m - $12m and we sometimes cannot access that money for up to and over 12 months. It is a lot for the board to risk. Now if you can explain to me how you would[underwrite] it, I am more than interested.

Mr Filby:    I have organised a lot of events for a lot of different clients. Each time is different. My role has always been to create the event to suit that client.

I have worked for Westfield, the RAS [the Royal Agricultural Society], Harbourside – Darling Harbour, NSW Government Carnivale, Liverpool City Council, Hurstville City Council, the Mark Hunter Benefit, Lee Kernighan’s Pass the Hat around Australia, Wollongong store made, Wollongong Council, Parramatta Council, WIN TV.

I know what you can do – firstly you would get a retail partner like Coles, Woolworths, AMP or Westfield.

For example Coles has 33,000 products on the shelves. Coles and Woolworths both have buyers talking to their suppliers every day. The way to work it is that each product line and pays to participate in the promotion. Coles can get them to do this. The difference is that it would be a multi-product promotion rather than being a single brand promotion, so it is a minimal cost to each product. It spreads the cost out.

The promotion is not on the labels of the product. Stickers on each product are not needed. The promotional material is on the shelves and in store at the point of sale. This saves everyone big bucks and makes deadlines happen. So the products do not have to spend money on creating new packaging to promote the competition which lowers to cost to each product line.

Coles or Woollies could get this going in a day.

This is how your board can cover the cost of any international act. The price you ask the retailers to pay covers the cost of the tour and everyone gets paid. Coles will know which products can be involved at the price.

Everyone wins.

The prize pool has to match the consumer expectations for a real chance to win. That is what drives the increase in sales for products and that is the incentive for the products to get involved. That is why it has to be a massive prize pool like a completely free concert. Coles wins by bringing an increase in store foot traffic and the fact that the consumer has to buy something in their store to win.

Your company wins because it owns the arena at Homebush and it owns Ticketek and Channel 9. You put on a concert at Homebush and instead of the audience paying for the concert, the products have paid for the concert up front. The arena gets paid – it is owned by nine. Ticket at gets paid – it is owned by nine. Channel 9 gets paid for the advertising and anyone else you need to be paid including the act is paid by the products upfront. So you do not have to wait 12 months to get your money.

Mr Jones:   This is a winner. I like it, I want it.”

63. Mr Filby says that after this discussion concerning the One Direction tour that Mr Jones continued in words to the following effect:

“Now I have my number one man here, Kelvin Kirk, who will work with you so Channel 9’s board can be properly briefed, and our management team can get the best out of this. Now it is important that you explain everything to Kelvin Kirk, he can organise a workshop. He must understand everything, and you must trust us on this so be open and put it all on the table, so that we can make this work for all of us. Thank you.”

64. According to Mr Filby, after Mr Jones left the meeting Mr Filby presented the Cashtime proposal to Mr Kirk. Then Mr Kirk recommended that they meet again, and a workshop was organised for the following Monday.

Analysis of the 26 February 2013 Meeting

65. Parts of Mr Filby’s version of the 26 February 2013 meeting give an improbable account of what Mr Jones is likely to have said. But parts of his version are supported by other evidence. Findings concerning the conversation at this meeting require close examination of the evidence of the participants and the probabilities of what Mr Filby claims was said.

66. Despite Nine Live’s submission to the contrary, such a conversation was not unlikely. The starting point is Mr Filby. He is very likely to have been ready to offer his ideas about the One Direction tour if Mr Jones raised the subject. And the Court finds that Mr Jones did raise the subject at the meeting.

67. Nine Live makes the point in its final submissions that Mr Jones had extensive experience in relation to events promotion and ticket sales, and had extensive marketing experience, including as National Sales Director of a major retail supplier and at Nine Entertainment Co, which itself had decades of experience in securing advertising revenue from retailers and other major commercial entities. Nine Live submits there is no logical reason why Mr Jones would approach Mr Filby, a man he did not know, for advice about a solution in relation to a ‘risk’ presented by the One Direction tour. Nine Live also points out that Mr Jones’ evidence is that he, and the Board, were already ‘extraordinarily comfortable’ committing to the One Direction tour.

68. There are two difficulties with wholly accepting this submission. First, Mr Jones was always on the lookout for new ideas. He commonly introduced meetings in late 2012 and early 2013 by talking to visitors to Nine Entertainment Co. about the upcoming One Direction tour. He was a sufficiently experienced and open-minded executive to realise that other people had good ideas and that discussions could generate better ideas. He liked to use his day-to-day business encounters to inform and refine his marketing ideas.

69. Second, the fact that Mr Jones was “extraordinarily comfortable” with committing to the One Direction tour was not necessarily an obstacle to him talking about aspects of its promotion with Mr Filby. The Court accepts Mr Jones was confident about the success of the tour well before he spoke to Mr Filby. And the trajectory of the band in the UK and Australia by then was likely to have given him confidence about the financial prospects of all aspects of the Australian tour. But Mr Jones was always on the lookout to find costs recovery and collateral advantages in existing commercial arrangements.

70. Next Nine Live relies upon Mr Jones’ evidence that he did not know Mr Filby prior to the 26 February meeting, nor was he aware Mr Filby had any prior involvement of the music industry. Mr Els agreed that prior to the 26 February meeting he did not provide any information about Mr Filby’s background and experience, as Mr Els considered would be discussed at the meeting. Based on this Nine Live submits that Mr Jones would not have asked Mr Filby’s opinion about the funding of the One Direction tour.

71. But Mr Filby explained his own business background at the meeting that may have been the trigger for Mr Jones to raise the issue of the One Direction tour, which he commonly did. Or Mr Jones may have launched into a discussion about the One Direction Tour and Mr Filby mentioned his expertise which then led Mr Jones seeking Mr Filby’s ideas. Although the Court does not accept Mr Filby’s account of the form of Mr Jones’ approach, the Court nevertheless accepts that at the beginning of the 26 February meeting a discussion about the 1D extra concert idea took place. It was Mr Jones’ habit at the time.

72. But parts of Mr Filby’s version of this meeting do not ring true. It is difficult to accept that Mr Jones said “it is costing the Board $9,000,000-$12,000,000 and we sometimes cannot access that money for up to and over 12 months. It is a lot for the Board to risk. Now, if you can explain to me how you would underwrite it, I am more than interested.”

73. Although the Court accepts that such a conversation took place, it is difficult to understand why Mr Jones would put a request to Mr Filby in the precise terms attested to by Mr Filby. Some of what Mr Filby attributes to Mr Jones, sounds jarring coming from someone as commercially savvy as Mr Jones. It is quite odd that Mr Jones would prefer to anything “costing the Board” or that the Board had much “for the Board to risk”, as if somehow the Board of Nine Entertainment Co was bearing these costs itself. Mr Jones could only have had in mind corporate expenses which he is unlikely to have described this way. And the Court accepts Mr Jones’ evidence that he would not have used the words “underwrite”, because he had never sought to have a tour underwritten and he would not have used that expression, as is clear from a closer examination of his evidence below.

74. But Mr Filby attributes terms other than “underwrite” to Mr Jones. He described Mr Jones as asking about “lowering risk” in relation to the One Direction tour. In the Court’s view Mr Jones was fishing for ideas to de-risk, to gain more revenue from, or to win collateral advantages from the One Direction tour. It is quite probable in preliminary very general discussion with Mr Filby he talked about the One Direction tour in a way that implicitly invited Mr Filby to contribute his ideas, if Mr Filby wished.

65. And there was good reason for Mr Filby to volunteer his ideas about the One Direction tour. Mr Els had called in favours to secure for Mr Filby this one-off opportunity to address the most senior executive decision maker at Nine Entertainment Co. to hear about Cashtime. Mr Filby was at last in the presence of the man that he knew he had to impress. He knew that 30 minutes was all the time he was going to get. And Mr Jones had just invited him to speak on a subject on which Mr Filby had ideas and saw himself as an authority.

66. In the Court’s view he freely, and without cautionary warnings about confidentiality, briefly volunteered some ideas about how Nine Entertainment Co could earn greater advantage from the One Direction tour to boost his credibility with Mr Jones. It was important to him to demonstrate, as he did in this short segment, that he had a fertile marketing imagination that allowed him to trace out workable marketing ideas. Responding to the invitation to talk about the One Direction tour was one way of proving his credentials. But for this to work he had to appear to Mr Jones to be generous with his ideas; not hedging them about with limitations on their use.

67. In the Court’s view on this part of the meeting Mr Filby was seeking to be expansive and did not signal to Mr Jones that any part of this general introductory discussion was confidential. Nor would it have appeared that way to Mr Jones, partly because in this early part of the discussion Mr Filby was also talking about other background information, such as his experience, which in no sense was confidential. In short, Mr Filby was prepared to share this idea with Mr Jones to secure the far greater objective of Nine Live adopting Cashtime.

68. It is also difficult to accept why Mr Jones would be concerned about delay in receiving proceeds of the One Direction tour in the circumstances. It is probably a correct description of the financial structure of the proposed One Direction tour that “we [Nine Live] sometimes cannot access that money for up to and over 12 months”, after time for the process of calculation of profits and profit sharing is allowed. But a little delay in receipt of tour proceeds of this order is unlikely to be of special concern to a large and well-resourced enterprise such as Nine Entertainment Co. And the issue would be even of less concern where, as was the case here, the tickets for the 2013 tour had been put on sale in April 2012 at the conclusion of the earlier One Direction promotional tour, at peak local popularity for the band. Objectively there seemed little overall risk to Nine Entertainment Co.’s receipts from the tour to warrant Mr Jones speaking of “risk”.

69. Moreover, the words attributed to Mr Jones are not consistent with his financial delegations from the board of Nine Entertainment Co (which in fact then was the board of PBL Media). In 2013 Mr Jones said he would only go to the board about the tour for approval in general terms and he would not go to “specifics about the elements of the tour, other than the financials”. He accepted that for a financial commitment like the 2013 One Direction tour board approval would be required.

70. The net result of this is that the Court does not accept Mr Filby’s precise account of how Mr Jones raised the subject of the One Direction tour at the beginning of the meeting. But the conversation did nevertheless occur. Apart from the Court’s acceptance of Mr Filby’s evidence that the subject was discussed, Mr Maroon and Mr Kirk both support the inference that the subject was discussed.

71. Mr Maroon. Mr Maroon is a practising solicitor and principal lawyer at Coleman Greig Lawyers. He met Mr Filby in about 2005 and over the years provided support and guidance to him. He has never provided legal advice to any of Mr Filby’s business ventures but believes that Mr Filby has interesting and novel ideas which if properly funded would provide benefits to the community.

72. Over the years Mr Filby has asked Mr Maroon to support him by occasionally attending meetings in which he has pitched his business concepts to potential funders or stakeholders. It was in this role that Mr Filby called on him to attend the 26 February 2013 meeting.

73. Mr Maroon recalls that the purpose of the meeting was for Mr Filby to present the Cashtime proposal to Channel 9 and that Mr Filby did so at the meeting. But outside the Cashtime presentation Mr Maroon recalls Mr Jones asking Mr Filby a question about One Direction’s upcoming tour. He recalls Mr Jones saying to Mr Filby words to the following effect:

“Mark, the Board has to set aside sums to cover the costs of these international acts that we bring out to Australia. We are bringing out One Direction this year and it is costing us about $10 million. Do you have any ideas as to how we can reduce the risk on these costs?”

84. In the Court’s view Mr Jones probably said something very general such as this to introduce the subject of the One Direction tour.

85. Mr Maroon recalls that Mr Filby responded to Mr Jones’ question. He does not recall the details of the response but remembers that the ideas included Channel 9 partnering with a retail partner such as Woolworths or Coles, to engage many brand owners to fund a competition. He does not recall Mr Filby referring to an entirely free concert. But he does recall him speaking about a large-scale competition. Mr Maroon’s very general evidence to this effect is accepted.

86. Was Confidentiality Expressly Discussed? Mr Filby says that confidentiality was expressly discussed. But this first raises the question: confidentiality about what? Mr Filby’s principal affidavit contained a statement which was inadmissible in form on a central issue. The statement said (at paragraph [64]), “I recall that Kelvin Kirk and Geoff Jones said in the meeting that Channel 9 was very respectful of confidentiality”. This statement was not tethered by context to any part of the meeting and was so vague as to be unhelpful.

87. The Court rejected it but gave Mr Filby leave to adduce further evidence in writing before he was called for cross examination. He then prepared a statement that became Exhibit E in his case.

88. Exhibit E said that at the beginning of the February 2013 meeting Mr Kirk said to him words to the effect “Everything we are dealing with will be kept confidential” and Mr Jones said, “That‘s right”.

89. The Court is guarded about accepting this changed evidence. The original paragraph [64] talks of Channel 9 being “very respectful of confidentiality” being said during the meeting. But Exhibit E puts the statement in the beginning of that meeting” and possibly before the preliminary discussion about the 1D extra concert idea was discussed.

90. It is unlikely that Mr Jones or Mr Filby gave any assurances about confidentiality at the beginning of the 26 February meeting and before the participants focused on the Cashtime proposal. The meeting opened with a degree of exploratory conversation in which both sides were getting to know one another. Assurances about confidentiality were unlikely at that point as being out of context. Discussions about confidentiality were more likely when the meeting was about to turn to the business at hand, the discussion about Cashtime. But even then the Court is not convinced that confidentiality was even mentioned. As this was commencing Mr Jones handed over to Mr Kirk and left the room. Everything that had occurred before Mr Jones left the room was in the nature of “get to know you” chitchat.

91. Mr Filby did not say to Mr Jones expressly, or by implication, that what he was saying was to be kept in confidence and not used to develop Nine Live’s thinking. Indeed, it was said openly as a matter of general mutual interest on a topic which both parties must have recognised was unrelated to the business in hand.

92. Mr Filby points out that some Nine Live witnesses agreed that discussions in the 26 February 2013 meeting would remain confidential. But on any view of the structure the meeting this does not apply to the preliminaries where the 1D extra concert idea was discussed.

93. This leads to consideration of the evidence of other witnesses present on 26 February 2013.

94. Mr Kirk’s Account. Mr Kirk gave an account that the Court accepts as described here. Mr Kirk recalls, and the Court accepts, that Mr Jones left the meeting shortly after it commenced, and that Mr Filby then presented his Cashtime concept. Mr Kirk recalls Mr Filby then spoke for almost a full hour presenting the Cashtime concept. Mr Kirk struggled to see the true value of the business proposition that Mr FIlby was advancing. He thought that the idea was “not realistic” and the numbers Mr Filby was presenting “seemed exaggerated”. He reacted poorly to Mr Filby, judging him to lack the level of professionalism that he would ordinarily see in this type of business meeting. Mr Filby left the Cashtime meeting feeling slightly “confused”.

95. Mr Kirk recalls Mr Jones brought up the One Direction tour, which was an exciting part of Nine Live’s business for that year. Mr Kirk’s recollection of this is an important foundation for the Court’s finding that this discussion took place. But Mr Kirk does not recall Mr Jones asking how he could “underwrite and lower Channel 9 Board’s risk” in relation to the upfront costs of the One Direction tour and the Court infers this was not said.

96. The Court does not accept that Mr Jones reacted to what Mr Filby said by saying “this is a winner. I like it, I want it”. This is not Mr Jones’ language. Whatever he said about the 1D extra concert idea, it was not this. The Mr Jones that the Court saw in the witness box is more likely to have given a subdued response to the 1D extra concert idea being mentioned. Even if Mr Jones were attracted to the idea there was little advantage in him expressing this kind of unbridled excitement about it. Moreover, Mr Kirk can be accepted when he says he had never known Mr Jones to speak like that in a professional setting or otherwise. The statements that Mr Filby attributes to Mr Jones and others are preceded by the standard statement that they were “words to the effect” of those recorded. But the tenor of the language attributed to Mr Jones does not fit well. All it can be said is that Mr Jones listened to whatever Mr Filby said about the 1D extra concert idea.

97. The other odd feature of the words that Mr Filby attributes to Mr Jones, “this is a winner”, “I like it, I want it” is that Mr Filby is unable to give any context as to what happened next. If Mr Jones had said these words, it can be expected that there would have been immediate focus on what Nine Live might do with the 1D extra concert idea, leading to follow up questions, planning and Mr Filby volunteering to be involved. But Mr Filby has no significant recollection of the conversation immediately after Mr Jones said these words.

98. Mr Kirk demurred from the suggestion that Mr Jones would ever refer to him as “his No. 1 man” when Mr Jones was handing over to Mr Kirk at the end of the meeting. And the Court accepts that it was not said.

99. Mr Kirk does not recall confidentiality being raised expressly at any stage during the meeting when Mr Jones was present or in the separate Cashtime part of the meeting. Mr Kirk’s practice was to sign a non-disclosure agreement before proceeding if the Nine Entertainment Co. had an interest in proceeding further with an idea being presented to it. Mr Kirk is to be accepted on this.

100. Mr Jones’ Evidence. Mr Jones denies having the conversation that Mr Filby attests occurred on 26 February 2013. The Court accepts Mr Jones’ evidence that he did not ask Mr Filby “how to underwrite” or lower the costs of the One Direction tour. Mr Jones gives an explanation, which the Court accepts, that at the time of the 26 February 2013 the One Direction tour had already been sold out, in the following circumstances.

101. The 2013 One Direction tour had been publicly announced in mid-April 2012 when One Direction were undertaking an earlier promotional tour of Australia. Tickets for fifteen performances of the proposed 2013 One Direction tour were made available for pre-sale on 24 April 2012 and for general sale on the afternoon of Saturday, 28 April 2012. By the end of that day 100,000 tickets had been sold. Over the following month all tickets that were available for sale to the public for the 25 performances comprising the 2013 One Direction tour had been sold out, some ten months prior to the February 2013 meeting.

102. Moreover, the finance database used by Ticketek in 2013 and still used by Ticketek, Compass, allows Ticketek to capture ticket sale numbers and sale proceeds for events for which Ticketek provides ticketing services, including events promoted by Nine Live. Compass records that as at 25 May 2012, a month after the opening of ticket sales, Ticketek had sold 180,684 tickets in connection with the One Direction tour and received $18,560,628 in ticket sale proceeds. In the following nine-month period between 25 May 2012 and 25 February 2013 Ticketek sold a further $51,867 in connection with the One Direction tour and had received a further $5,499,205 in ticket sale proceeds.

103. Mr Jones explains that Nine Live was required to pay some upfront costs associated with promoting the One Direction tour. The most significant cost of promoting the tour was the fee to be paid to One Direction. Nine Live guaranteed it would pay One Direction a minimum of [not published] for fifteen performances regardless of whether the tour was ultimately profitable. A further 11 shows were ultimately added to the tour, but the minimum guarantee was not increased. Mr Jones explains, and the Court accepts, that this level of guarantee to One Direction did not cause him any concern in February 2013 because Nine Live was only required to pay 10 per cent of that fee upfront by no later than 31 December 2012. A further 40 per cent of that fee was payable no later than 29 July 2013 with the balance to be paid after the conclusion of the band’s final performance in Australia.

104. Mr Jones says that from these circumstances he knew in February 2013 that Nine Entertainment Co. was not taking on any unacceptable or unusual financial risk and there was no special need to underwrite the tour. Moreover, the Court accepts Mr Jones’ evidence that during his time with the Nine Group Nine Live has never underwritten a tour that it was promoting.

105. Mr Jones denies raising the subject of One Direction in the form of asking Mr Filby for the benefit of his experience. Mr Jones says it is not his practice to seek advice on high level and strategically important tours from a person he had never met or worked with previously. The Court accepts that Mr Jones did not seek advice from Mr Filby. Until the meeting he knew little about Mr Filby's experience. But in the Court’s view Mr Jones did test the waters to see what ideas Mr Filby could offer about the One Direction tour and Mr Filby obliged by informally and very briefly suggesting the 1D extra concert idea.

106. Mr Filby’s case points out that Mr Jones agreed that the promoter bore “a risk”. But that did not mean that he said all the other things that Mr Filby attributed to him.

107. Mr Hoffman. Little additional evidence comes from Mr Hoffman. He says he attended a meeting with Mr Filby, Morris Maroon and Mr Kirk in Mr Kirk’s office in Goulburn Street in the Sydney CBD. He recalls Mr Kirk being “very positive about Cashtime” and that he believed as a result it was likely that the concept would soon move to the next stage of development. Mr Hoffman says that he had a “vague recollection” that Mr Filby raised the issue of the One Direction tour promotion with Mr Kirk during the meeting and that there was “some placating or conciliatory response from Kelvin” although Mr Hoffman did not pay much attention to the specifics.

108. In cross examination Mr Hoffman firmly said that the meeting he was describing was “in winter”, probably in June or July 2013. But there were no meetings between Mr Filby and Mr Kirk in winter 2013. Mr Hoffman’s evidence is therefore puzzling. It ultimately goes nowhere and can be put to one side.

109. What Did Mr Filby Say? The Court’s findings on this conflicting evidence still leave a substantial area of disagreement about what was said by Mr Filby at the 26 February 2013 meeting. The core of Mr Filby’s account of what he said commences with the words above “I know what you can do…” and concludes with the words “so you don’t have to wait 12 months to get your money”.

110. The Court does not accept that Mr Filby said anything as detailed as this to Mr Jones. And an interesting puzzle emerges which throws some doubt upon the detail of Mr Filby’s account as to how he came to know that all 25 concerts were sold out and that an extra concert would be required. Another difficulty in Mr Filby’s account is that it sounds something like a lecture with Mr Jones as a passive student listening to Mr Filby’s statements on many things which would have been obvious to Mr Jones in any event.

111. Another difficulty with Mr Filby’s version is that he has had an opportunity over many years to look at the actual Coles promotion in question, that may be described as “the Coles 1D promotion”, and to think about it and in the Court’s view he has reconstructed to a degree and added into the conversation elements of the Coles 1D promotion which he learned of in 2013.

112. But taking these matters into account the Court infers the following. Mr Jones raised the subject of the One Direction tour and the fact that it was sold out, but that Nine Live was still looking to leverage sponsorship opportunities from the tour. Mr Filby is likely to have mentioned the idea of an extra concert and that in-store purchasers of qualifying merchandise could go into a draw for tickets to that concert. To experienced marketing executives such as Mr Jones the 1D extra concert idea did not need to be described in any more elaborate terms than it is in this paragraph of these reasons.

113. In the Court’s view it was quick, casual and not even expressed as a formal business proposition. The text that Mr Filby claims to have said after the words “I know what you can do” is quite foreign to the nature of the likely interaction between himself and Mr Jones. That interaction was brief and quickly passed over but probably nevertheless informed and reinforced an idea in Mr Jones’ thinking about the Coles sponsorship.

114. Mr Filby’s case seeks to bolster Mr Filby’s credit by saying that various figures in confidential Exhibit J, which deals with the financial integers of the One Direction tour, closely coincide with Mr Filby’s recollection of the February 2013 meeting. But without going into the detail, which it is not necessary to do, Exhibit J expresses ranges of figures and Mr Filby’s account of the February 2013 meeting is otherwise inherently improbable in the ways which the Court has already discussed in these reasons.

The Workshop at Channel 9’s Offices – 4 March 2013

115. A workshop to look at the detail of the Cashtime proposal took place at Channel 9’s offices in Goulburn Street on 4 March 2013. This workshop meeting took place because, as Mr Kirk explained, Mr Filby’s explanation about Cashtime on 26 February 2013 was “long and detailed” and the meeting ran over time. The 4 March 2013 meeting was really a resumption and continuation of the earlier meeting. Differing accounts emerged about the value of this workshop.

116. An email Mr Els wrote on the evening of 4 March 2013 rather frankly reflects his perception that he and Mr Filby had not excited Mr Kirk about Cashtime at the 4 March meeting. Mr Els felt that maintaining momentum was best achieved by him by writing a follow up email later that evening, which he did as follows:

“Hi Kelvin

Many thanks for the time today and your patience.

I know Mark is impatient and wants it all to happen immediately because he doesn’t quite understand we all need do our own due diligence.

180. A series of emails was exchanged between Mr Kirk and Ms Baker-McLelland between 10 July and 25 July 2013. A final conversation took place between them shortly after 25 July 2013.

The One Direction Competition Ends – 31 July 2013

182. Mr Filby continued to push the idea. But within a week of Mr Kirk’s last email to Ms Baker-McLelland, he told Mr Filby that Nine Live did not wish to proceed with Cashtime. Mr Kirk communicated this to Mr Filby in an email dated 31 July 2013, as follows:

“Hi Mark,

Unfortunately, we can’t progress with another meeting. I have tried but there is not an appetite for another meeting. Again, I wish you all the best but we will have to decline this opportunity”.

183. This freed Mr Filby from any restraint in complaining about Nine Live’s alleged misuse of the 1D extra concert concept. But he still made no immediate complaint to Nine Live about that issue.

184. Mr Filby harboured suspicions that he was being told that Nine Live was not proceeding with the Cashtime proposal at a time which coincided with the end of the Coles promotion. He believed that Nine Live were waiting until the end of the Coles 1D promotion period on 31 July to give him the bad news. According to Mr Maroon Mr Filby rang Mr Maroon and said to him in what must have been early August 2013:

“Channel 9 have told us they don’t want to move ahead with Cashtime. Can you believe they told us the day after the One Direction competition closed.”

185. Mr Maroon’s evidence confirms that Mr Filby seemed suspicious about the timing of the communication to him that Nine Live were no longer interested in the Cashtime proposal.

186. Mr Filby’s suspicions that Nine Live schemed to inform him that the Cashtime proposal was rejected at the same time as the Coles ID promotion came to an end, is unlikely to be correct. A period of about three weeks during July 2013 is explained by internal emails and communication between Mr Filby and Ms Baker-McLelland discussing the Cashtime concept in a businesslike way. This internal email evidence is not consistent with an inference that a strategy of deliberately artificial delays was being deployed to ensure that Mr Filby would not hear about the rejection of Cashtime, until after the conclusion of the Coles One Direction promotion.

187. There was a delay of just under a week after Mr Kirk’s last communication with Ms Baker-McLelland on 25 July 2013. But this was a hard message for Mr Kirk to give to Mr Filby and he would not have been in a hurry to disappoint him. Moreover, Mr Kirk had nothing to do with managing the Coles One Direction promotion within Nine Live or the Nine Entertainment Co. and it is unlikely that he was even aware of the end date of the promotion at the time he communicated the rejection to Mr Filby.

188. The events of 31 July 2023 are a watershed for assessing Mr Filby’s credibility and the power of his belief that Nine Live had misused his confidential information. Mr Filby recognised that from the time that Mr Kirk told him that Nine Live was not proceeding with Cashtime that he was free to complain about Nine Live’s alleged misuse of the 1D extra concert idea. But Mr Filby did not write to Nine Live or make any formal complaint about its alleged misuse of the 1D extra concert concept for years, until these proceedings were commenced in 2019.

189. Mr Filby’s explanation for this failure to complain is unsatisfactory. He says that instead “we went to Channel 7”. He says that Channel 7 took up Cashtime. He also says that his friend Doc Neeson was dying of cancer and that “the last thing that we wanted to do was a court case”. Instead, he says he was “trying to get on with life”.

190. But the Court does not accept that if Mr Filby really believed Nine Live had misused ideas that he had given to it in confidence that he would have been so inert about the issue. He said he was disgusted with Nine Live’s conduct and believed that he had lost a great deal of money as a result. Yet he could not explain to the Court’s satisfaction why he did not write even a simple formal contemporaneous letter complaining of Nine Live’s misuse of the 1D extra concert idea.

191. The better explanation for Mr Filby’s failure to write at this time is that he knew that he did not give the 1D extra concert idea to Nine Live on the basis that it could not be used or should be kept confidential. Whilst Mr Filby had other pressures distracting him from this issue in late 2013 and in the years that followed, the Court cannot accept that having legal friends such as Mr Maroon, a person as resourceful as Mr Filby did not write the simplest letter of complaint to Nine Live, if he really believed that Nine Live had breached the confidence that he attached to the 1D extra concert idea. Mr Filby’s subsequent behaviour is an important confirmation of the Court’s findings about the 26 February 2013 meeting.

Analysis of the Submissions and the Legal Issues

192. The applicable legal principles are not in issue. Obligations of confidence can arise from established relationships, express stipulation or by circumstances sufficient that any reasonable person standing in the shoes of the recipient of the information would have realised upon reasonable grounds that the information was being given in confidence: Coco v AN Clark (Engineers) Ltd [1968] 1A IPR 587 at 591. The basis of the doctrine of breach of confidence lies in the notion of an obligation of conscience arising from the circumstances or through which the information was communicated or obtained: Moorgate Tobacco Co Ltd v Phillip Morris (No. 2) (1984) 156 CLR 414 at 438 per Deane J.

193. The authorities such as Optus Network Pty Ltd v Telstra Corp. Ltd (2010) 265 ALR 281; [2010] FCAFC 21 at [39] (Finn, Sundberg and Jacobson JJ) established that Courts should address the following matters in determining whether a case for breach of confidence is made out: (1) the information in question must be identified with specificity; (2) it must have the necessary quality of confidence; (3) it must have been received by the defendant in circumstances importing an obligation of confidence; and (4) there must be an actual or threatened misuse of the information without the consent of the person who imparted it.

194. As result of the Court’s findings, the plaintiff, Mr Filby, fails in these proceedings because he has not established a number of these matters.

195. As to (1), the very limited information which the Court has found Mr Filby conveyed to Mr Jones was extremely vague general and limited and finds its best description in paragraphs [2], [3] and [110] of these reasons. This information was inherently unspecific.,

196. As to (2), the Court has heard very detailed evidence from the impressive expert witness Mr Walker on the question of the uniqueness of the information. But that evidence is predicated upon the correctness of Mr Filby’s detailed account of what he said to Mr Jones. But the Court does not accept that was all said to Mr Jones. All that Mr Jones got from Mr Filby was a very general and inchoate idea expressed to the maximum in paragraphs [2], [3] and [110] of these reasons.

197. As to (3), the information was not received by Nine Live in circumstances importing an obligation of confidence. As the Court’s findings show Mr Jones’ informal conversation with Mr Filby at the outset of the February 2013 meeting was one in which he was not alerted to any special confidentiality over the ideas being imparted to him. Had he been so aware he would have observed the obligations of confidence.

198. As to (4), there was no misuse of the information in question. It informed Mr Jones and Mr Wiltshire’s thinking but there was no misuse as they were not alerted expressly or by the circumstances to any obligation of confidentiality concerning the information.

Conclusion and Orders

199. Nine Live has been successful in the proceedings and ordinarily costs would follow the event. But the Court will allow an opportunity for one or other party to seek a special costs order.

200. Nine Live sought to restrict the publication by the Court of financial figures associated with the 2013 Australian tour of One Direction. The Court will order that these reasons not be published for a period to give Nine Live an opportunity to review and refine the non-publication orders, if any, that it seeks.

201. For these reasons the Court makes the following orders and directions:

1. The relief sought in the plaintiff’s Amended Statement of Claim is dismissed;

2. Order that the reasons for these orders will not be published for 28 days from today, or such further time as the Court may on application allow, so as to permit the defendant or any other person an opportunity to consider whether it wishes (a) to make any application for non-publication orders over any part of the Court’s reasons for judgment, or (b) to continue any application for non-publication orders, in respect of other materials in the proceedings; and

3. Reserve for further consideration all questions as whether costs should follow the event or whether some other costs order including a special costs order should be made;

4. List the proceedings at 9:30 AM on Friday, 21 April 2023, or such other mutually convenient date as may be arranged with the chambers of Slattery J, for the Court to consider any outstanding issues of confidentiality or costs, or to give directions in relation to those matters; and

5. Grant liberty to apply.

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Decision last updated: 26 May 2023