J Wisbey & Associates Pty Ltd v UBS AG - [2021] FCA 36

FEDERAL COURT OF AUSTRALIA
J Wisbey & Associates Pty Ltd v UBS AG [2021] FCA 36

File number: VID 567 of 2019

Judgment of: BEACH J

Date of judgment: 29 January 2021

Catchwords: REPRESENTATIVE PROCEEDINGS – foreign currency instruments – alleged cartel conduct – corporations – practice and procedure – application to replead – group definition – numerous permutations and combinations of claims – pleading of alleged cartel understandings – availability of inferences to be drawn – application to replead refused

Legislation:
Competition and Consumer Act 2010 (Cth) ss 4E, 5, 44ZZRC, 44ZZRD, 44ZZRJ, 44ZZRK

Federal Court of Australia Act 1976 (Cth) ss 33H, 33J, 33ZB, Pt IVA

Trade Practices Act 1974 (Cth) ss 4E, 5, 45, 45A, 44ZZRC, 44ZZRD, 44ZZRJ, 44ZZRK

Cases cited:
Australian Competition and Consumer Commission v Olex Australia Pty Ltd [2017] FCA 222

Bray v F Hoffman-La Roche Ltd [2002] FCA 1405

Forrest v Australian Securities and Investments Commission (2012) 247 CLR 486

Hassid v Queensland Bulk Water Supply Authority t/as Seqwater [2017] NSWSC 599

IL v The Queen (2017) 262 CLR 268

Perera v GetSwift Ltd (2018) 263 FCR 92

Webster (Trustee) v Murray Goulburn Co-Operative Co. Ltd (No 2) [2017] FCA 1260

Wigmans v AMP Ltd (2019) 373 ALR 323

Division: General Division

Registry: Victoria

National Practice Area: Commercial and Corporations

Sub-area: Economic Regulator, Competition and Access

Number of paragraphs: 313

Date of hearing: 8 and 9 October 2020

Counsel for the Applicant: Mr B Quinn QC with Ms E Levine

Solicitor for the Applicant: Maurice Blackburn Lawyers

Counsel for the First Respondent: Ms WA Harris QC with Mr MI Borsky QC, Mr J Kirkwood and Ms JD Williams

Solicitor for the First Respondent: Herbert Smith Freehills

Counsel for the Second Respondent: Mr C Caleo QC with Mr A Barraclough

Solicitor for the Second Respondent: Clayton Utz

Counsel for the Third Respondent: Mr M Darke SC with Mr J Arnott

Solicitor for the Third Respondent: Allens

Counsel for the Fourth Respondent: Mr S Lawrance with Mr D Blazer

Solicitor for the Fourth Respondent: Allen & Overy

Counsel for the Fifth Respondent: Mr C Moore SC with Mr N De Young QC and Mr M Sherman

Solicitor for the Fifth Respondent: King & Wood Mallesons

ORDERS

VID 567 of 2019

BETWEEN:
J WISBEY & ASSOCIATES PTY LTD (ACN 001 959 851)

Applicant

AND:
UBS AG (ABN 47 088 129 613)

First Respondent

BARCLAYS BANK PLC (01026167)

Second Respondent

CITIBANK N.A. (ABN 34 072 814 058) (and others named in the Schedule)

Third Respondent

ORDER MADE BY:

BEACH J

DATE OF ORDER:

29 JANUARY 2021

THE COURT ORDERS THAT:
1.The applicant’s application for leave to file and serve an amended originating application and an amended statement of claim in the form currently proposed to the Court be refused.
2.Costs reserved.

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

REASONS FOR JUDGMENT
BEACH J:

This representative proceeding concerns alleged cartel conduct by the respondents involving foreign currency spot and forward transactions.
The applicant has applied for leave to file and serve an amended originating application and an amended statement of claim. The application is opposed by all respondents although they differ as to their criticisms concerning the applicant’s offering.
Now it is not in doubt that leave to replead should not be granted if the proposed pleading or a significant part thereof:
(a)is unintelligible or vague in material respects;
(b)does not fulfil the basic function of identifying the issues and disclosing a reasonably arguable cause(s) of action;
(c)is too general with its allegations of material facts or suffers from an absence of sufficient particularity; or
(d)is otherwise in a form that may prejudice, embarrass or delay the fair trial of the proceeding.
Four other preliminary points should also be made. First, the determination of whether leave to replead should be given is to be informed by the dual objectives of the function that the applicant’s pleading must satisfy. One such objective is to properly inform the respondents of the case that they have to meet and also the Court. The other objective is to provide a suitable structural framework to enable the Court to efficiently run the trial and then adjudicate on the issues. Second, if both objectives can be satisfied by the applicant choosing a reasonable form, I should not be too concerned with nice distinctions between material allegations, particulars and evidence. In other words, and as Mr Bernie Quinn QC for the applicant correctly submitted, there should be a reasonable margin of appreciation for the form chosen by the pleader, so long as it is sufficient to satisfy both objectives. Third, what is an acceptable version of a pleading in a particular case will depend upon the time that the pleading is proffered, whether discovery or its review is complete, and importantly the nature of the case sought to be advanced. Fourth, any pleading requirements in the Federal Court Rules 2011 (Cth) need to be applied flexibly rather than rigidly to address the points that I have just made. After all, such Rules expressly recognise that they can be tailored or dispensed with to suit the occasion (see rr 1.31(1), 1.34 and 1.35). They are not designed to be applied in a mechanistic way, particularly where one is dealing with complex commercial class actions with the additional generality that is usually permitted. I will return to these matters later.
At this point, let me say something briefly about the applicant’s case as reflected in the proposed amended statement of claim (PASOC).
The five respondents, who are various international financial institutions, are said to carry on global businesses of dealing in FX instruments including in Australia. It is said that they are players in a “Global FX Market”, which comprised of “Global Trading Centres” including Australia (see [9] to [13] of the PASOC), and a separate “Australian FX Market” (see [14] to [17] of the PASOC), for such instruments.
Now the FX instruments that I am particularly concerned with come in two flavours. One type concerns what has been described as a “Spot”. A “Spot” is an agreement to exchange sums of different currencies at an agreed-on exchange rate on a value date that is within two bank business days’ of the agreement being struck. The other type is an “Outright Forward”. There are two differences as compared with a “Spot”. The first difference is that the value date must be more than two bank business days’ ahead. The other aspect, given that I am concerned with “Outright Forwards”, is that the derivatives here do not include non-deliverable forwards or contracts for difference.
The applicant’s principal cartel allegations concern the period 1 January 2008 to 15 October 2013 (the relevant period) and are contained in [21] and [22] of the PASOC. They are as follows (omitting particulars):
21.By no later than the start of, alternatively during, the Relevant Period, each of the Respondents, by themselves, and/or by their employees or agents, and/or by related bodies corporate:
(a)made an agreement or arrangement, or arrived at an understanding, with each, alternatively one or more, of the other Respondents, and/or one or more of the Other Cartel Participants, containing provisions, or to the effect, that each of them would share with one or more of the others information in relation to trade in FX Instruments with respect to one or more of the Affected Currency Pairs, including in relation to trade volumes and/or trade strategy, and/or would coordinate trading in FX Instruments and/or the Spreads with respect to one or more of the Affected Currency Pairs to impact the prices of FX Instruments, to the benefit of one or more of them, including by:
(i)widening the Spreads provided to customers with respect to Affected Currency Pairs;
(ii)coordinating their Spot trading activities to influence the price of the WMR Fix with respect to one or more of the Affected Currency Pairs;
(iii)coordinating their Spot trading activities to influence the price of the ECB Fix with respect to one or more of the Affected Currency Pairs; and/or
(iv)manipulating Spot Rates to trigger Stop Loss Orders with respect to one or more Affected Currency Pairs.
(Information Sharing and Trade Co-Ordination Understanding); or
(b)made a series of agreements or arrangements, or arrived at a series of understandings with each, alternatively one or more, of the other Respondents, and/or one or more of the Other Cartel Participants, containing provisions, or to the effect, that each of them would share with one or more of the others information in relation to trade in FX Instruments with respect to one or more of the Affected Currency Pairs, including in relation to trade volumes and/or trade strategy, and/or would coordinate trading in FX Instruments and/or the Spreads with respect to one or more of the Affected Currency Pairs to impact the prices of FX Instruments, to the benefit of one or more of them, including by:
(i)widening the Spreads provided to customers with respect to Affected Currency Pairs;
(ii)coordinating their Spot trading activities to influence the price of the WMR Fix with respect to one or more of the Affected Currency Pairs;
(iii)coordinating their Spot trading activities to influence the price of the ECB Fix with respect to one or more of the Affected Currency Pairs; and/or
(iv)manipulating Spot Rates to trigger Stop Loss Orders with respect to one or more Affected Currency Pairs. (Information Sharing and Trade Co-Ordination Understandings).
22.By no later than the start of, alternatively during, the Relevant Period, each of the Respondents, by themselves, and/or by their employees or agents, gave effect to the Information Sharing and Trade Co-Ordination Understanding, alternatively the Information Sharing and Trade Co-Ordination Understandings, by:
(a)sharing with each, alternatively one or more, of the other Respondents, and/or one or more of the Other Cartel Participants, information in relation to trade in FX Instruments with respect to one or more of the Affected Currency Pairs, including in relation to trade volumes and/or trade strategy, and/or
(b)co-ordinating with each, alternatively one or more, of the other Respondents, and/or one or more of the Other Cartel Participants, trading in FX Instruments and/or the Spreads with respect to one or more of the Affected Currency Pairs to impact the prices of FX Instruments, to the benefit of one or more of them, including by:
(i)widening the Spreads provided to customers with respect to Affected Currency Pairs;
(ii)coordinating their Spot trading activities to influence the price of the WMR Fix with respect to one or more of the Affected Currency Pairs;
(iii)coordinating their Spot trading activities to influence the price of the ECB Fix with respect to one or more of the Affected Currency Pairs; and/or
(iv)manipulating Spot Rates to trigger Stop Loss Orders with respect to one or more Affected Currency Pairs.
Further, in later paragraphs ([23], [25], [27] and [29]) there are pleaded separate and what I would describe as more specific arrangements and understandings which derive from the possibilities pleaded in sub-paragraphs (i) to (iv) of [21(a)] that I have just set out. Further, in [31] a concealment arrangement or understanding is pleaded concerning the earlier arrangements and understandings.
Now the respondents in their various ways have criticised the form of the PASOC. It is useful to categorise their complaints into three main areas involving:
(a)first, the group description;
(b)second, the form and structure of [21] and [22] of the PASOC and derivative paragraphs and the multitude of possibilities pleaded; and
(c)third, more precise questions involving the applicant’s inferential case and the pleaded elements required to satisfy the statutory causes of action.
So, it is convenient to structure my reasons in that order. Further, I will endeavour to eliminate any duplication of submissions as between respondents. And in that regard I will largely focus for each particular issue on the submissions of the respondent who, informally, had carriage of that issue in oral argument.
But let me say now that I refuse the applicant leave to replead in the form of the PASOC, largely because of the legitimate criticisms concerning the second category of issues. And as for the proposed amended originating application, I would prefer not to grant leave to amend this at this time, notwithstanding that I am content with the proposed group definition, until the proper form of the principal pleading allowed to go forward has been resolved.
GROUP DESCRIPTION
Section 33H(1)(a) of the Federal Court of Australia Act 1976 (Cth) requires that an application commencing a representative proceeding describe or otherwise identify the group members to whom the proceeding relates. But no unduly narrow or technical approach should be taken to this requirement. It should be construed and applied bearing in mind the function that it is intended to perform under Pt IVA.
Group members must be described or identified so that they can be notified of the proceeding and can decide whether to opt out pursuant to s 33J. Another function of s 33H(1)(a) is so that the Court can identify who is bound by any judgment for the purposes of s 33ZB.
The pleading must not be so vague or uncertain that potential group members cannot reasonably ascertain whether they are members of the group. A group definition should not give rise to significant uncertainties or ambiguities in this respect.
Some practical questions may be posed. Is the description such as to reasonably enable a person, with the assistance of a legal adviser if necessary, to ascertain whether he is a group member? And if the description incorporates a reference to conduct alleged in the pleadings, can a person or his adviser, by reading the description and the relevant portion of the pleadings, reasonably determine whether he is a group member? If the answer is no to either or both questions, the definition is unlikely to satisfy s 33H(1)(a). But clearly, the fact that inquiries might need to be made by a person who is uncertain of whether they are a group member does not deprive the description of objective criteria by reference to which membership can be established. And the fact that potential group members may need to make inquiries to ascertain whether they fall within the group definition does not render that definition inadequate for the purposes of s 33H(1)(a).
Now the first respondent (UBS) challenges the group definition in two significant respects.
First, it says that the group definition does not comply with s 33H(1)(a). In this respect it asserts that the group members cannot be identified from the definition.
Second, it says that the group definition fails to exclude group members who are already pursuing materially similar claims against the respondents in foreign proceedings. Further, it says that the proposal to exclude only released “FX Instruments” rather than settling group members by the “Excluded Instruments” carve-out, which I will discuss later, is contrary to principle and unworkable in practice.
Before proceeding further I should set out the group definition contained in [1] of the PASOC which is as follows:
1.This proceeding is commenced as a representative proceeding pursuant to Part IVA of the Federal Court of Australia Act 1976 (Cth) by the Applicant on its own behalf and on behalf of all persons who or which:
(a)at any time during the period commencing on 1 January 2008 and concluding on 15 October 2013 (Relevant Period) were party to an FX Instrument or FX Instruments (other than Excluded Instruments) in relation to one or more of the Affected Currencies Pairs which was or were Arranged in Australia;
(b)by reason of the matters alleged in subparagraph 1(a) above, bought and/or sold currency during the Relevant Period to the total value equal to or more than the Minimum Transaction Volume;
(c)suffered loss or damage by reason of the conduct of one or more of the Respondents as pleaded in this Amended Statement of Claim;
(d) are not, and were not at any material time:
(i) any of the Respondents;
(ii)a related body corporate of any of the Respondents within the meaning of s 4A of the Trade Practices Act 1974 (Cth) (TPA) and the Competition and Consumer Act 2010 (Cth) (CCA) (as applicable), save where the related body corporate was party to an FX Instrument or FX Instruments in accordance with subparagraphs 1(a) and (b) above in its capacity as a trustee for a person who was not a related body corporate of any of the Respondents;
(iii)a director or officer or a close associate of any of the Respondents within the meaning of s 9 of the Corporations Act 2001 (Cth) (CA);
(iv)any of the entities specifically named in the definition of Other Cartel Participant above; or
(v)a Justice, Registrar, District Registrar or Deputy District Registrar of the Federal Court of Australia or the High Court of Australia; or
(vi)an officer or employee of Maurice Blackburn Lawyers, or a legal representative engaged by Maurice Blackburn Lawyers in this proceeding,
(Group Members).
The definitions clause in the PASOC, which is relevant to some aspects of the group definition and also to other matters that I need to discuss later, provides:
DEFINITIONS
In this Amended Statement of Claim:
Affected Currency Pairs means the Australian dollar (AUD), British pound (GBP), Euro (EUR), Japanese yen (JPY), New Zealand dollar (NZD) or the US dollar (USD) paired with another currency from any of the following: Brazilian real (BRL), Canadian dollar (CAD), Chinese yuan (CNY), Czech koruna (CZK), Hong Kong dollar (HKD), Hungarian forint (HUF), Indian rupee (INR), Indonesian rupiah (IDR), Israeli shekel (ILS), Malaysian ringgit (MYR), Mexican peso (MXN), Norwegian krone (NOK), Polish zloty (PLN), Romanian leu (RON), Russian ruble (RUB), Singapore dollar (SGD), South African rand (ZAR), South Korean won (KRW), Swedish krona (SEK), Swiss franc (CHF), Taiwan dollar (TWD), Thai baht (THB), Turkish lira (TRY).
Arranged in Australia means, in relation to an FX Instrument:
1.where the FX Instrument is entered into, whether orally, in writing, electronically or otherwise:
(a)by the customer or their employee or agent while the customer, employee or agent (as the case may be) is in Australia; and/or
(b)by the Dealer or their employee or agent while the Dealer, employee or agent (as the case may be) is in Australia; and/or
2. where the FX Instrument is entered into upon the execution of a Resting Order:
(a)which order was placed, whether orally, in writing, electronically or otherwise by a customer or their employee or agent while the customer, employee or agent (as the case may be) is in Australia; and/or
(b)which order was accepted, whether orally, in writing, electronically or otherwise by a Dealer or their employee or agent while the Dealer, employee or agent (as the case may be) is in Australia.
Dealer means an individual or firm acting as a principal, rather than as an agent, who is engaged in the purchase and/or sale of currencies, and the quoting of prices for the purchase and/or sale of currencies, to customers in the Dealer’s capacity as an FX market maker.
ECB Fix is the benchmark exchange rate for about 32 FX currencies traded against the EUR, published daily by the European Central Bank, including Spot Rates for 32 currencies actively traded against the EUR, which is determined as at 2.15pm Central Europe Time (1.15pm London, United Kingdom, time) by capturing the data from currency bids and offers by market participants on or around that time.
Electronic Communication Network means an electronic system that facilitates the trade in Spot and Outright Forwards, including a “single-bank” electronic platform, a “multi-bank” electronic platform, a remittance provider electronic platform, an automated programming interface, a request for quote system and an electronic matching engine.
Excluded Instrument means an FX Instrument which is the subject of a release forming part of the settlement in:
(a)the United States of America class action proceeding known as In Re Foreign Exchange Benchmark Rates Antitrust Litigation, No. 1:13-cv-07789-LGS (District Court for the Southern District of New York);
(b)Canadian class action proceeding known as Mancinelli v Royal Bank of Canada et al, case CV-15-536174 (Superior Court of Ontario); and/or
(c)Canadian class action proceeding known as [Béland] v Royal Bank of Canada et al, case 200-06- 000189-152 (Superior Court of Quebec).
FX means foreign exchange, being the purchase or sale of a currency against the sale or purchase of another currency.
FX Instruments means Spots and Outright Forwards.
Minimum Transaction Volume means AUD 500,000, calculated by reference to:
(a) where an individual transaction involves AUD, the AUD amount; and
(b)where an individual transaction does not involve AUD, the higher of the AUD amount resulting from applying the exchange rate in the table below to each currency in the transaction [the table is not reproduced].
Other Cartel Participants includes the following and their respective related bodies corporate other than the Respondents: Bank of America Corporation, Barclays Plc, Barclays Capital Inc, BNP Paribas Group, BNP Paribas S.A., Citigroup Inc, Citicorp, Citigroup Global Markets Inc, Credit Suisse Group AG, Deutsche Bank AG, The Goldman Sachs Group Inc, HSBC Holdings Plc, HSBC Bank Plc, HSBC Bank USA N.A., JPMorgan Chase & Co., Morgan Stanley, Mitsubishi UFJ Financial Group, Inc. (formerly the Bank of Tokyo Mitsubishi UFJ Ltd), Royal Bank of Canada, RBC Capital Markets LLC, The Royal Bank of Scotland Group Plc, Société Générale S.A., Standard Chartered Bank Plc and Toronto Dominion Bank.
Outright Forward means an agreement to exchange sums of currency at an agreed-on exchange rate (cash settlement) on a value date that will be in more than two bank business days’ time, but does not include non-deliverable forwards or contracts for difference.
Resting Order means an instruction from a customer to a Dealer to enter into an FX Instrument if specified conditions are met, including a Stop Loss Order.
Spot means an agreement to exchange sums of currency at an agreed-on exchange rate (cash settlement) on a value date that is within two bank business days’ time.
Spot Rate means the exchange rate for a currency pair applicable at any single point in time.
Spread means the difference between the bid and ask price for a currency.
Stop Loss Order means an instruction from a customer to a Dealer to:
(a)buy a volume of currency at the best available price if the exchange rate rises to a specified rate; or
(b)sell a volume of currency at the best available price if the exchange rate falls to a specified rate.
WMR Fix means the benchmark exchange rate for various FX currencies published daily by WM/Reuters, which is determined as at 4.00pm London, United Kingdom, time by capturing the data from currency bids and offers by market participants in the 30 seconds at either side of 4.00pm.

Now it is convenient to note at this point that during the hearing and at my invitation, which was graciously but not gratefully accepted by Ms Wendy Harris QC for UBS, alternative wording to the group definition was propounded by UBS in the following form:
Define “Settled Actions” as:
(a)the United States of America class action proceeding known as In re Foreign Exchange Benchmark Rates Antitrust Litigation, No 1:13-cv-07789-LGS (District Court for the Southern District of New York);
(b)the Canadian class action proceeding known as Mancinelli v Royal Bank of Canada et al, case CV-15-536174 (Superior Court of Ontario); and
(c)the Canadian class action proceeding known as [Béland] v Royal Bank of Canada et al, case 200-06-000189-152 (Superior Court of Quebec).
Define “Ongoing Actions” as the proceedings referred to in the table to our submissions
(a)the United States of America class action proceeding known as Nypl v JP Morgan Chase & Co, No 1:15-cv-09300-LGS (District Court for the Southern District of New York);
(b)the United States of America class action proceeding known as Contant v Bank of America Corporation, No 17-cv-03139-LGS (District Court for the Southern District of New York); and
(c)the United States of America class action proceeding known as Allianz Global Investors Gmbh v Bank of America Corporation, No 1:18-cv-10364-LGS (District Court for the Southern District of New York).
Amend paragraph 1 to provide:
This proceeding is commenced as a representative proceeding pursuant to Part IVA of the Federal Court of Australia Act 1976 (Cth) by the Applicant on its own behalf and on behalf of all person who or which:
(a)       at any time during the period commencing on 1 January 2008 and concluding      on 15 October 2013 (Relevant Period):
(i)        were ordinarily resident or carrying on business in Australia; and
(ii)       while they were so resident or carrying on business, entered into an        FX Instrument or FX Instrument in relation to one or more of the      Affected Currency Pairs; and
(b)by reason of the matters alleged in subparagraph 1(a) above, bought and/or sold currency during the Relevant Period to the total value equal to or more than the Minimum Transaction Volume; and
(c)suffered loss or damage by reason of the conduct of one or more of the Respondents as pleaded in this Amended Statement of Claim;
(d)      are not and were not at any material time:
(i)        parties to or represented in any of the following proceedings:
(a)the Settled Actions, if claims for loss or damage in respect of their entry into an FX Instrument referred to in subparagraph 1(a) were advanced in the Settled Actions; and
(b)       the Ongoing Actions, if claims for loss or damage in respect      of their entry into an FX Instrument referred to in      subparagraph 1(a) are advanced in the Ongoing Actions; and
(c)       any other proceedings advancing claims for loss or                   damage in respect of their entry into an FX Instrument referred      to in subparagraph 1(a), unless they also entered into an FX      Instrument referred to in subparagraph 1(a) which is not the       subject of claims for loss and damage in any such proceeding;
(ii)       any of the Respondents;
(iii)      [etc, per existing subparagraphs 1(d)(ii)-(vi)]
Essentially, UBS proposed two key restrictions to the group definition. First, it proposed to limit the group to persons who were ordinarily resident or carrying on business in Australia. Second, it proposed to limit the group by excluding persons who were or are parties to or represented in certain settled or extant foreign proceedings that I will discuss in a moment. Further, it also proposed to exclude persons who are parties to or represented in “any other proceedings advancing claims for loss or damage in respect of their entry into an FX Instrument” that is the subject of the proceeding before me, save for a carve-out where such persons also entered into an FX Instrument that is the subject of the proceeding before me, but is not the subject of any claims being advanced in “any such [other] proceeding”. Predictably, the applicant opposed so restricting the group definition in these respects.
I will discuss the form of UBS’ alternative wording in the running. But for the moment, let me deal with the principal complaints of UBS.
The question of identification
Let me commence with the first point raised by UBS.
Paragraph (a) of the proposed group definition relevantly describes persons who or which “at any time during the period commencing on 1 January 2008 and concluding on 15 October 2013 (Relevant Period) were party to an FX Instrument or FX Instruments (other than Excluded Instruments) in relation to one or more of the Affected Currency Pairs which are or were Arranged in Australia”.
Now in order to comprehend this aspect of the definition, it is necessary to concentrate upon some of the specific defined terms which I have already set out.
The PASOC defines “Arranged in Australia” as follows:
Arranged in Australia means, in relation to an FX Instrument:
1.where the FX Instrument is entered into, whether orally, in writing, electronically or otherwise:
(a)by the customer or their employee or agent while the customer, employee or agent (as the case may be) is in Australia; and/or
(b)by the Dealer or their employee or agent while the Dealer, employee or agent (as the case may be) is in Australia: and/or
2. where the FX Instrument is entered into upon the execution of a Resting Order:
(a)which order was placed, whether orally, in writing, electronically or otherwise by a customer or their employee or agent while the customer, employee or agent (as the case may be) is in Australia; and/or
(b)which order was accepted, whether orally, in writing, electronically or otherwise by a Dealer or their employee or agent while the Dealer, employee or agent (as the case may be) is in Australia.
“FX Instruments” is defined to mean “Spots and Outright Forwards”, which are in turn defined. “Dealer” is defined to mean “an individual or firm acting as a principal, rather than as an agent, who is engaged in the purchase and/or sale of currencies, and the quoting of prices for the purchase and/or sale of currencies, to customers in the Dealer’s capacity as an FX market maker”. “Resting Order” is defined as “an instruction from a customer to a Dealer to enter into an FX Instrument if specified conditions are met, including a Stop Loss Order”, which is in turn defined.
Paragraph (b) of the group definition further requires that “by reason of the matters alleged in [paragraph (a)]” the person bought and/or sold currency during the relevant period to the value of at least the “Minimum Transaction Volume”, being AUD500,000, calculated by reference to exchange rates set out in the definition of that term which I have not bothered to set out.
I should say at this point that in my reasons from hereon I will use the PASOC’s defined terms unless I have indicated otherwise.
Now four aspects of the proposed group definition may be noted.
First, the group definition contains no residency criterion. I should say now that that is true, but in my view under Pt IVA non-residents can be group members. Now although the definition has no residency requirement, it requires that someone, whether the customer or Dealer, or their employee or agent, was “in Australia” when the FX Instrument was entered into or the Resting Order placed or accepted.
Second, the group definition applies to FX Instruments entered into or Resting Orders placed or accepted “whether orally, in writing, electronically or otherwise”. Elsewhere, the PASOC identifies a range of different ways in which FX Instruments can be entered into, such as through sales desks and/or trading desks in various locations, through electronic communication networks, and through brokers including voice brokers.
Third, the group definition is not limited to FX Instruments arranged with Dealers who are respondents to this proceeding. It includes any individual or firm who fell within the definition of Dealer at the relevant time.
Fourth, the group definition is not limited to FX Instruments arranged during the relevant period. It merely requires that the person was “a party to” the FX Instrument in the relevant period.
By reason of these features, UBS says that the present definition is not one that enables persons to ascertain whether they are group members, even by making inquiries and with the assistance of a legal adviser.
To reinforce its criticisms, UBS posed the following hypothetical questions.
How is a person to ascertain the time at which they “entered” into an FX Instrument, bearing in mind the range of different ways in which FX Instruments could be entered into that I have mentioned, to enable them to ascertain whether they happened to be “in Australia” at that time, even assuming that they still had records of where they were at any particular point during the relevant period, being 2008 to 2013?
How is a person to ascertain whether the entity with which they were dealing fell within the definition of a Dealer at the relevant time? For instance, how are they to ascertain whether the individual or firm was acting as a principal rather than as an agent? And how are they to ascertain whether that individual or firm was acting in the capacity of an FX market maker?
How is a person to ascertain whether the Dealer, or the relevant employee or agent of the Dealer, was “in Australia” when the FX Instrument was “entered”, assuming they can ascertain when it was “entered”?
Further, in relation to customers and Dealers that are bodies corporate, which can only act through their employees or agents, does the definition look to the domicile of the customer or Dealer or to the physical location of the particular employee or agent who executed the transaction? For example, a customer or Dealer might be domiciled in Australia but the employees or agents who executed the transaction might be physically located in Singapore. And what if there were several employees or agents involved in different countries?
Moreover, so UBS says, these inquiries may need to be undertaken by a person in respect of multiple FX Instruments and Dealers to ascertain whether they meet the Minimum Transaction Volume criterion to qualify as a group member.
In short, UBS says that the group definition is too broad and imprecise to enable a potential group member to determine whether they fall within it. It says that this is likely to preclude effective communication by way of notices with group members for opt out and other purposes, and the identification of who may be bound by any judgment. It says that it is also likely to prevent the identification of persons who are overlapping group members in ongoing foreign proceedings.
I would reject the criticisms of UBS on this aspect of the group definition.
In my view, each of the defined terms used in the group definition, being the terms “Affected Currency Pairs”, “Arranged in Australia” (see also “Resting Order” and “Stop Loss Order”), “Dealer”, “Excluded Instrument”, “FX Instrument”, “Minimum Transaction Volume” and “Relevant Period” that I have set out above are capable of objective identification or verification.
Now I accept that it will be necessary to have regard to the defined terms in order to ascertain whether a person is a group member, but this does not make the group definition vague or uncertain.
Further, as to the matters suggested by UBS as being incapable of identification by a potential group member, these should be readily ascertainable, particularly by recourse to relevant transaction records and the assistance of a legal adviser if necessary.
So, as the applicant submitted, potential group members should be able to readily ascertain by reference to independent recollection or their transaction records whether they entered into a particular FX Instrument during the relevant period whilst in Australia or with a Dealer in Australia. Further, potential group members should be able to ascertain, perhaps with the assistance of a legal adviser if required, whether the person or entity with whom they transacted falls within the definition of a “Dealer”, particularly group members who are likely to have been regular or frequent participants in financial transactions of this type.
Further, the phrase “in Australia” in the definition of “Arranged in Australia” should be clear and should not give rise to any confusion in the context of corporate customers or Dealers.
Further, where a customer, including a corporate customer, entered into an FX Instrument through an employee or agent, the relevant objective question is whether that employee or agent was “in Australia” at the time.
Now UBS says that if the group definition is intended to look to the physical location of the particular employee or agent who executed the transaction, this is not clear from the group definition itself. Further, UBS points out the scenario in which there might have been several employees or agents involved in different countries.
There was debate before me from the other respondents concerning “Arranged in Australia” and the question of the location of the Dealer or their employee or agent. Mr Cameron Moore SC for the fifth respondent (NatWest) posed the question:
And so the example that was given was a person located in Singapore, a customer located in Singapore who dealt with a person in Sydney, and then that person in Sydney then placed a trade with a desk in New York. Mr Quinn says, nevertheless the person the customer is dealing with is in Sydney, therefore the dealer is in Australia. And so far as it goes, that’s clear enough because one can then say, “Well, where is the person you’re dealing with located?” But what is not clear from the definition is the reverse situation. Assume a person in Singapore places a trade with somebody in New York. So the person in Singapore says, “I’m dealing with someone in New York, I can’t see any connection with Australia here”. But the firm with which they are dealing with in New York happens to also have a small outpost in Sydney. Is that firm then a firm in Australia?
In my view, this would not be covered if that arm was not doing the relevant dealing. The definition is to be read as picking up trades that, in effect, involve dealing with someone in Australia.
Now I also accept that computer trading adds to the complexity of making the relevant determination. But this cannot be avoided.
In summary, I do not accept the respondents’ criticisms.
Let me now say something about UBS’ residency requirement in its proposed formulation.
I agree with the applicant that there is no warrant for limiting the group to persons who were ordinarily resident or carrying on business in Australia. There are neither jurisdictional issues nor demonstrable group identification difficulties that necessarily require such a narrowing of the group definition.
First, the Court possesses both jurisdiction over the respondents and subject matter jurisdiction over the proceeding. In such circumstances, it is empowered under Pt IVA to determine the claims of the applicant and all group members irrespective of whether such group members ordinarily resided or carried on business in Australia.
Second, any comparison with the group definition question in the vitamins cartel class action litigation (Bray v F Hoffman-La Roche Ltd [2002] FCA 1405 at [36] per Merkel J) is inapposite. The difficulty in that case of identifying casual visitors to Australia who purchased a relevant vitamin or product containing such a vitamin does not arise with and has no analogy with the entry into of FX Instruments which involve documented financial transactions capable of being readily identified. In any event, the applicant in the vitamins cartel class action agreed to confine the group definition, rather than being compelled to do so by any application of principle.
Third, in any event there can be complexity in determining whether a group member was “ordinarily resident or carrying on business in Australia” at a given point in time.
Fourth, it cannot be assumed that a residency requirement would have only a slight effect on the magnitude of rights being pursued through the proceeding as now constituted. As Mr Quinn QC pointed out, given that the Global FX Market operated on a 24-hour basis revolving through the different time zones, limiting the group definition with a residency criterion may unfairly shut out substantial numbers of foreign residents who traded on the Australian segment of that market when it was the only segment open for trade, and who may not have access to redress in any other proceeding.
Group members and foreign proceedings
Let me now address the second main point of UBS concerning the question of overlap involving settled and current foreign proceedings.
The group member definition refers to group members who “were party to an FX Instrument or Instruments (other than Excluded Instruments)”. “Excluded Instruments” are defined as an FX Instrument which is the subject of a release forming part of the settlement in certain settled foreign proceedings, namely:
(a)the US class action proceeding known as In Re Foreign Exchange Benchmark Rates Antitrust Litigation, No. 1 1:13-cv-07789-LGS (District Court for the Southern District of New York) (US Forex proceeding);
(b)the Canadian class action proceeding known as Mancinelli v Royal Bank of Canada et al, case CV-15-536174 (Superior Court of Ontario); and
(c)the Canadian class action proceeding known as Béland v Royal Bank of Canada et al. case 200-06-000189-152 (Superior Court of Quebec).
The effect of this exclusion is to prevent persons from claiming in this proceeding for loss in respect of which they have already been compensated in the US Forex proceeding and the Mancinelli and Béland class actions.
I will turn to the desirability of this exclusion later, which UBS criticised and the applicant in oral argument sought to bargain away with me.
UBS complains that the applicant has omitted to exclude from the group definition persons who are continuing to pursue materially similar claims against the respondents in certain ongoing foreign proceedings, namely:
(a)the US class action proceeding known as Nypl v JP Morgan Chase & Co, No 1:15-cv-09300-LGS (District Court for the Southern District of New York);
(b)the US class action proceeding known as Contant v Bank of America Corporation, No 17-cv-03139-LGS (District Court for the Southern District of New York); and
(c)the US class action proceeding known as Allianz Global Investors Gmbh v Bank of America Corporation, No 1:18-cv-10364-LGS (District Court for the Southern District of New York).
UBS also says that the applicant has failed to exclude from the group definition persons who are party to “any other ongoing proceeding advancing claims for loss or damage in respect of their entry into an FX Instrument” unless such persons also entered into an FX Instrument that is the subject of this proceeding, but that is not the subject of the claims being advanced in such “other proceedings”.
UBS’ alternative form of wording for the group description was proffered as an apparently helpful embodiment of UBS’ position on this aspect.
UBS says that overlapping group members ought not to remain in multiple proceedings and referred to Perera v GetSwift Ltd (2018) 263 FCR 92 at [150] per Middleton, Murphy and Beach JJ. Now whilst GetSwift was dealing with multiple proceedings before the same Court, UBS says that the principle is apt to apply to multiple proceedings before a combination of Australian and foreign courts.
UBS also prayed in aid what Bell P said in Wigmans v AMP Ltd (2019) 373 ALR 323 at [56]:
In the transnational context, the policy to avoid a multiplicity of proceedings is also very strong: see, for example, [Australian Health & Nutrition Association Ltd v Hive Marketing Group Pty Ltd [2019] NSWCA 61; (2019) 367 ALR 146] at [81]-[89]; Incitec Ltd v Alkimos Shipping Corp (2004) 138 FCR 496; [2004] FCA 698 at [53] (Incitec) and the cases there cited. It is informed in part, but by no means exclusively, by concern for what is sometimes referred to as international judicial comity. More powerfully still, it is informed by “the deep and strong antipathy of courts for the promotion of circumstances allowing for inconsistent curial approaches to the same dispute”: Incitec at [53]. That having been said, it will not always be possible or appropriate to avoid a multiplicity of proceedings, as the decision of the Full Court of the Federal Court in TS Production LLC v Drew Pictures Pty Ltd (2008) 172 FCR 433; [2008] FCAFC 194 (TS Production) illustrates.

Further, UBS says that the applicant’s proposal to limit the definition of “Excluded Instrument” to FX Instruments that are the subject of releases in the settled proceedings fails to address the ongoing foreign proceedings in which materially similar claims are made against the present respondents on behalf of classes that may well include group members in the present proceeding.
Now UBS helpfully provided me with a table which relevantly summarised the three ongoing proceedings in the US, being the Nypl, Contant and Allianz proceedings, including the forum, the description of the class, the defendants, the nature of the claims, and the status of each proceeding. I should note that the ongoing US proceedings are separate from the US Forex proceeding, which as I have mentioned has been settled and is referred to in the definition of “Excluded Instruments”.
Now in the Nypl class action, the class includes “[a]ll consumers and businesses in the United States who directly purchased supracompetitive foreign currency at Benchmark exchange rates from Defendants and their co-conspirators for their own end use at least since January 2007 to and including class certification, herein”. UBS says that if such a consumer or business happened to do so whilst either they or the Dealer (or the relevant employee or agent of either) was in Australia, and were a party to the relevant FX Instruments during the relevant period, and met the Minimum Transaction Volume, they would also be a group member in my proceeding.
In the Contant class action, the proposed settlement class relevantly includes “all persons who between 1 December 2007 and 31 December 2013 (inclusive) “indirectly” purchased an FX Instrument from a Defendant or co-conspirator [in or while domiciled in several named US states] by entering into an FX Instrument with a member of the Direct Settlement Class where the Direct Settlement Class member entered into the FX Instrument directly with a Defendant or Co-conspirator”. The “Direct Settlement Class” refers to the class in the US Forex proceeding. Again, UBS says that if such a person happened to do so whilst either they or the Dealer (or the relevant employee or agent of either) was in Australia, and were a party to the relevant FX Instruments during the relevant period, and met the Minimum Transaction Volume, they would also be a group member in my proceeding.
In the Allianz proceeding, the plaintiffs consist of entities who opted out of the settlement class in the US Forex proceeding, who engaged in FX transactions with the defendants between 2003 and 2013 that occurred in the United States “by way of the Plaintiff and/or its counterparty operating in the United States”. Again, UBS says that if such persons happened to transact whilst either they or the Dealer (or the relevant employee or agent of either) was in Australia, were a party to the relevant FX Instruments during the relevant period, and met the Minimum Transaction Volume, they would also be a group member in my proceeding.
In addition to the issue of the ongoing foreign proceedings, UBS says that there is a further issue raised by the applicant’s proposal to formulate the exclusion relating to settled overseas proceedings by reference to “an FX Instrument which is the subject of a release forming part of the settlement in” those proceedings, rather than by reference to settling group members in those proceedings. In this regard it makes the following points.
First, it says that it is a fundamental concept under Pt IVA that a group comprises persons and not claims of persons. Thus, a person cannot be a group member only “to an extent”; a person is either a group member or not. So, the purported bifurcation of claims of a group member into different proceedings is contrary to Pt IVA. The applicant’s proposed exclusion by reference to released FX Instruments rather than settling group members transgresses this principle. Its effect would be that if a person were a party to sufficient relevant FX Instruments other than Excluded Instruments, they would be a group member in this proceeding, despite the fact that they were also a group member, and provided releases, in one of the settled proceedings.
Second, UBS says that even if the first point were not accepted, it is unclear how a person would in any event be able to distinguish between an Excluded Instrument and another FX Instrument for the purpose of trying to ascertain group membership in this proceeding. Unsurprisingly, the releases provided in the settlements of the US Forex proceeding and the two settled Canadian proceedings, Mancinelli and Béland, do not identify particular FX Instruments; rather, the releases are general ones, which are expressed by reference to “released claims”. Again, the proposed exclusion by reference to released FX Instruments is too imprecise to enable a person, even with the assistance of a legal adviser and after making inquiries, to determine whether they are a group member in my proceeding.
I would reject the criticisms of UBS. Let me park for the moment the “Excluded Instruments” question and deal with UBS’ other points which it has sought to address in its alternative formulation.
In my view, the group definition is not deficient by reason of it potentially encompassing some overlapping group members who may also fall within the class definition in extant foreign proceedings.
First, the observations in GetSwift and in Wigmans relied on by UBS, were made in the context of the now all too common phenomenon of multiple Australian proceedings commenced against the same respondent(s) with respect to the same or similar subject matter and involving a substantial number of overlapping group members, where the Court is called upon to stay one or more of those multiple proceedings or consolidate or otherwise jointly manage them. But such observations regarding the issue of overlapping group members in that particular context cannot be translocated to the different question of whether the group definition in the only extant Australian proceeding making the present allegations satisfies the requirements of s 33H(1)(a). There are no relevant competing proceedings before me or any other Australian court giving rise to the associated case management, representational and funding issues which are the central concerns of cases such as Getswift and Wigmans.
Further, Bell P’s policy observations in Wigmans concerning transnational litigation seem to me to be unobjectionable. So much may be accepted. But where does this all go? I can eliminate any duplication at the appropriate time in the proceeding before me. Further and in any event, if any group member is the subject of any release in a foreign proceeding, that can ultimately be pleaded in bar at an appropriate time before me (or someone else) when any s 33R issue arises. Further, if any group member is the subject of a judicial determination in a foreign proceeding, then the relevant issue estoppel may be pleaded at an appropriate time. In short, I do not need to anticipate and deal with these matters at this time in terms of formulating the boundaries and content of the group description.
Second, unlike the competing domestic proceedings in GetSwift and Wigmans, as the applicant has pointed out, there are considerable differences between the nature and scope of the proceeding before me and each of the three ongoing foreign proceedings.
In the Nypl proceeding Barclays Bank Plc (the second respondent before me) is not named as a defendant. Further, the class definition refers to “[a]ll consumers and businesses in the United States” and does not refer to any group members entering into FX Instruments in Australia or with a Dealer in Australia. Further, the class definition refers to consumers and businesses who “directly purchased supracompetitive foreign currency at Benchmark exchange rates from Defendants and their co-conspirators for their own end use at least since 1 January 2007 to and including class certification, herein”, rather than persons entering into an FX Instrument with a Dealer. Further, the plaintiffs allege, in the context of asserting that the Southern District of New York is an appropriate venue for the proceeding, that a substantial part of the events giving rise to the plaintiffs’ claims occurred in that District, a substantial portion of the affected interstate trade and commerce was carried out in that District, and one or more of the defendants has an agent, maintains an office or does business in that District. But contrary to the applicant’s submissions, I do accept that there is some overlap.
Further, in the Contant proceeding the Royal Bank of Scotland Plc (RBS) (now NatWest, the fifth respondent before me) is not named as a defendant. Further, claims are brought on behalf of the New York class, the Arizona class, the Florida class, the Illinois class, the Massachusetts class, and the Minnesota class, each being confined to all persons and entities who indirectly purchased an “FX Instrument” from a “Defendant or co-conspirator” “in [the relevant state] and/or while domiciled in [the relevant state]”. Further, claims are also brought on behalf of the California class and the North Carolina class , each being confined to all persons and entities who indirectly purchased an “FX Instrument” from a “Defendant or co-conspirator” “and were thereby injured in [the relevant State]”. An “FX Instrument” is defined as any FX spot transaction, forward, swap, future, option, or any other FX transaction or instrument the trading or settlement value of which is related in any way to FX rates. Further, the claim expressly excludes “all indirect purchases of FX Instruments where the direct purchaser was operating outside the U.S. at the time the direct purchase was made and the purchase was made with the foreign desk of a Defendant”. But this exclusion does not apply where the direct purchaser was operating in the United States. And such persons could be caught by the present group definition. Further, the plaintiffs allege (in the context of asserting that the Southern District of New York is an appropriate venue for the proceeding) that a substantial part of the events giving rise to the plaintiffs’ claims occurred in that District, and a substantial portion of the affected interstate trade and commerce had been carried out in that District.
Further, in the Allianz proceeding the plaintiffs comprise persons who between 2003 and 2013 entered into FX transactions with the defendants, including FX spot, forward, option, and swap and futures transactions, that occurred in the United States, by way of either the plaintiff or its counterparty operating in the United States. Further, the plaintiffs allege, in the context of asserting that the Southern District of New York is an appropriate venue for the proceeding, that a substantial part of the events or omissions giving rise to these claims occurred in that District; further, a substantial portion of the affected interstate trade and commerce had been carried out in that District.
In summary, although there may be some overlap, these three ongoing US proceedings will not necessarily involve a substantial overlap in group membership or claims. Further, to the extent that any overlapping group membership raises the spectre of double recovery, that issue can be managed by me at a later stage of this proceeding. Further, in my view there is no need to exclude from the group definition persons with purportedly overlapping claims in UBS’ defined “Settled Actions”, “Ongoing Actions” or “any other proceedings”.
More generally, the scope of any overlap in claims is presently uncertain. An abstract exclusion without proper analysis of the existence, nature and extent of any overlap is inappropriate. In those circumstances, it is premature to exclude group members from this proceeding on the basis that there is a possibility of unidentified overlap with claims in foreign proceedings, particularly where they may not even result in any redress to those group members.
Let me deal further with the “Excluded Instruments” question, although the applicant now seems prepared to bargain it away.
Relevantly, in my view this “Excluded Instruments” carve-out does not transgress the requirement that the group definition identify persons rather than claims. Relevantly, the group definition in the PASOC identifies persons on whose behalf this proceeding is brought notwithstanding the “Excluded Instruments” exclusion.
Further, the group definition in terms does not commit the “to an extent” vice. The observation by Beech-Jones J in Hassid v Queensland Bulk Water Supply Authority t/as Seqwater [2017] NSWSC 599 at [23] that “[a] person is either a group member or not” was made in the context of a sub-paragraph of a group definition which provided that the group members were “group members as that term is defined in the [relevant] proceedings but only to the extent of any claim or claims they have for pure economic loss within sub-paragraph c) above”. But in the PASOC, specific group members are identified without any such limitation.
Further, the applicant has commenced a single Pt IVA proceeding which seeks to prevent double recovery with respect to claims brought in foreign jurisdictions that have been the subject of settlement agreements. But persons who had a portion of their overall loss from FX transactions compensated in a settled foreign proceeding are not prevented from seeking to vindicate in this jurisdiction claims for different losses arising out of different FX transactions.
Further, no practical difficulty arises on the question of identification.
The definition of “Class Members” in the settlement agreements in the US Forex proceeding includes geographical parameters linked to the US and the definition of “Released Claims” expressly excludes “claims based upon transactions executed solely outside the United States and arising under foreign laws belonging to any Releasing Party or Person that is domiciled outside the United States”.
The definition of the “Settlement Class[es]” in the settlement agreements in the Mancinelli and Béland class actions referred to in the “Excluded Instruments” definition include geographical parameters linked to Canada (including Quebec); and the definition of “Released Claims” in the UBS settlement agreements in those proceedings expressly exclude “claims based upon transactions executed solely outside of Canada and arising under foreign laws belonging to any Releasing Party or Person that is domiciled outside of Canada”.
Further, if there is an overlap in any event, as I have indicated it is for UBS to assert in its defence that any claims in this proceeding have already been compromised in another proceeding.
In summary, I see little wrong with the applicant’s “Excluded Instruments” carve-out.
Now during the oral hearing, it became apparent to the applicant that it might not need such a carve-out. It appeared to appreciate that if any claim of a group member had been compromised by a settlement in a foreign proceeding, this was a matter for a respondent to plead and prove rather than anticipating the whole question by a group definition carve-out.
But I am agnostic as to whether the carve-out should remain. I will leave it to the applicant to make a choice as to whether it wants that carve-out, once other pleading questions have been resolved, in any later versions of the originating application and the statement of claim. But to include such a carve-out does not in my view give rise to any real s 33H(1)(a) problem.
Let me deal with one other lesser point before moving on to the respondents’ main attack.
The applicant personally
The respondents say that the PASOC does not plead facts capable of establishing that the applicant satisfies the definition for group membership. They say that only examples of FX Instruments have been referred to concerning the applicant which are well under the AUD minimum threshold for group membership. Now that may be true. But in my view the pleas in [2(c) and (d)] are adequate together with the particulars which are described as examples in any event, with further particulars to be given. Moreover, the evidence before me establishes that the applicant has bought and sold during the relevant period Affected Currency Pairs with a total value of around AUD1.7 million, which is well above the Minimum Transaction Volume. If necessary, further particulars can be given.
THE MAIN DEFICIENCY – A MULTITUDE OF POSSIBILITIES
The respondents variously submit that the PASOC fails to disclose a reasonable cause of action, is likely to cause prejudice, embarrassment or delay and is otherwise defective.
It is said that the pleading contains a “forest of forensic contingencies” presenting “hundreds if not thousands, of alternative and cumulative combinations of allegations” with the effect that it is not possible to discern the case that is being alleged. Accordingly, it is said that the PASOC does not give fair notice of the case the respondents will face at trial. It is said to be unclear from the PASOC how many contracts, arrangements or understandings (CAUs) are alleged or between which banks or persons each CAU is alleged to have been made.
First, it is said that the PASOC does not identify the number or identity of parties said to have made each CAU. Rather, each respondent is alleged to have made each CAU “with each, alternatively one or more, of the other Respondents, and/or one or more of the Other Cartel Participants”. Together, the respondents and Other Cartel Participants comprise numerous corporate groups or banks.
Second and relatedly, it is said to be unclear from the PASOC which, if any, of the non-parties that are defined as the Other Cartel Participants are alleged by the applicant to have been counterparties to a CAU involving them and the extent to which that CAU is alleged to have been implemented. The deficiencies in the PASOC mean that the respondents cannot give sensible consideration to possible rights of contribution they may have against third parties.
Third, it is said to be unclear when the applicant will contend that each CAU was made. The PASOC alleges that each CAU was made by no later than the start of, alternatively during, the relevant period, being 1 January 2008 to 15 October 2013; this is an unspecified point of time in an unspecified period that may span well over six years.
Fourth, it is said that most of the particulars are inadmissible (e.g. “findings” of regulators and admissions of other respondents) or not probative of a CAU (e.g. the volume of communications in a chat group). Further, it is said that although some particular chat room communications are referred to in the schedules of particulars to the PASOC, it is not clear from the pleading what they are said to establish (i.e. how many CAUs, between what parties and at what point in time) or how (i.e. by what chat or combination of chats each CAU was made and by what words). It is said that their relationship with the pleaded CAU is not apparent.
Fifth and relatedly, it is said that the particulars to the alleged CAUs and to the alleged “giving effect to” of those CAUs are incoherent and do not support the allegations in the pleading. There is disconformity and tension between the conduct that is particularised and the alleged CAUs. In particular, whilst the particulars allege facts and circumstances, such as individual communications in individual chat rooms, that could conceivably found an allegation that on a particular occasion a particular group of representatives fixed or influenced the rate for a particular set of transactions, the PASOC pleads umbrella CAUs, such as an arrangement to engage in chat room communications to, for example, set rates. It is said that there are no particulars to support such umbrella CAUs.
Sixth, it is said that the PASOC alleges matters that do not constitute contraventions of the Trade Practices Act 1974 (Cth) (TPA) or the Competition and Consumer Act 2010 (Cth) (CCA) in respect of the relevant cartel provisions applicable at various times. Challenges are made to the adequacy of the pleading concerning, inter-alia, market and competition questions.

But I do accept that the applicant should provide further particulars of the competition plea upon the completion of discovery.
Relevant markets
The respondents say that the PASOC does not plead facts capable of establishing the alleged markets. The product dimension of the alleged markets is the supply of FX Instruments. FX Instruments are defined as Spots and Outright Forwards. To be within the same market, Spots and Outright Forwards should be substitutable with one another (s 4E of the TPA and the CCA). But it is said that no facts capable of establishing that Spots and Outright Forwards are substitutable have been pleaded.
Further, they say that the product dimension of the markets appears to comprise the supply of FX Instruments with respect to all currency pairs. But the only fact pleaded in respect of the substitutability of FX Instruments with respect to different currency pairs is that currency the subject of FX Instruments is “fungible”; see [11(a)] with respect to the alleged Global FX Market and [16(a)] with respect to the alleged Australian FX Market. They say that fungibility of currency is not the same as and cannot establish demand or supply side substitutability of FX Instruments with respect to different currency pairs.
But I would reject the respondents’ submissions. In my view there has been an adequate plea of the relevant markets. The PASOC pleads facts which are capable of establishing the Global FX Market and the Australian FX Market, identifying the product and geographical dimensions of the relevant markets, including by reference to the concept of substitutability.
Further, on the question of substitutability, it is alleged in the context of the Global FX Market that a Spot with respect to a currency pair of a specific volume was substitutable anywhere in any of the Global Trading Centres, for any other Spot with respect to the same currency pair of the same volume. It is also alleged that an Outright Forward with respect to a currency pair of a specific volume was substitutable anywhere in any of the Global Trading Centres, for any other Outright Forward with respect to the same currency pair of the same volume. Further, it is alleged that a Dealer entering into an FX Instrument with a customer anywhere in any of the Global Trading Centres with respect to any given currency pair of a specific volume provided the same, or effectively the same, service to that customer as any other Dealer in any of the Global Trading Centres entering into the same type of FX Instrument with respect to the same currency pair of the same volume. It is then alleged that a Dealer in Australia supplying and/or offering to supply an FX Instrument to a customer in or outside Australia with respect to any given currency pair of a specific volume provided the same, or effectively the same, service to that customer as any other Dealer in Australia supplying and/or offering to supply the same type of FX Instrument in respect of the same currency pair of the same volume. There are similar pleas in the PASOC with respect to the Australian FX Market. Moreover, no further substitutability needed to be pleaded between a Spot and an Outright Forward involving the same currency pairing or between or across different currency pairings in relation to either FX Instrument. But I will not preclude the respondents from raising this matter again once the next version of the applicant’s pleading has been put forward.
In my view the pleas are sufficient at this time.
“Giving effect to” allegations
Now the respondents also complain about the “giving effect to” allegations. But in my view, the “giving effect” allegations contained in [22], [24], [26], [28], [30] and [32] are also adequately pleaded.
An inference is open from the chat particulars referred to in the schedules of particulars, among other particulars, that the respondents gave effect to each of the CAUs to the benefit of one or more of them.
As the applicant has pointed out, the Bloomberg interbank chat dated 13 November 2008 at item 2 of schedule B is one example in support of such an inference with respect to giving effect to the “Information Sharing and Trade Co-Ordination Understanding(s)” and the “WMR Fix Understanding(s)”.
In this chat transcript, A, acting on behalf of RBS, C, acting on behalf of Barclays, and B, acting on behalf of Citibank, discussed their EUR/USD trading positions ahead of the WMR Fix. A told C and B that RBS had bought a large amount of EUR against GBP and noted that the exchange rate has “colla[ps]ed”. A then suggested that the group should sell EUR and C told A not to sell yet. A asked: “maybe in 20 mins we can sell it ?” (i.e. at approximately 4.00 pm London time, after the WMR Fix); C confirmed that A should wait. At 15:42:12, C informed B and A that he had an order to buy EUR 110 million against USD at the WMR Fix. A responded that he had a “decent” amount “to buy as well”. B told A and C that he was also a buyer of EUR 125 million against USD at the WMR Fix. C stated: “3 WAY RACE!!!”.
After the WMR Fix, C told the group that he bought EUR 30 million against USD before the Fix at a rate of 40. B stated that the EUR/USD WMR Fix rate was 68.5. C and B responded by saying, respectively, “woo hoo” and “wheeeyyy”. If C then sold EUR 30 million against USD at the WMR Fix rate of 68.5, having previously acquired that sum of EUR at the rate of 40, he would have made a profit of 28.5 “pips”, equivalent to approximately USD $85,500. At 16:32:08, A told the group that he bought EUR 100 million against USD at an average rate of 47 ahead of the WMR Fix. If A then sold the 100 million EUR against USD at the WMR Fix rate of 68.5, having previously acquired that sum of EUR at the rate of 47, he would have made a profit of 21.5 “pips”, equivalent to approximately USD $215,000.
Further, the Bloomberg interbank chat dated 13 April 2012 referred to at item 18 of schedule C is another example in support of an inference with respect to giving effect to the “Information Sharing and Trade Co-Ordination Understanding(s)”, as well as with respect to the “ECB Fix Understanding(s)”.
The chat transcript records A (on this date acting on behalf of JPMorgan) and B, acting on behalf of Citibank, discussing information regarding their ECB Fix positions. B told A that he had orders to buy approximately EUR 170 million against USD (also referred to as being “RHS”) at the upcoming ECB Fix. A responded to B that he had a total of EUR 101 million to sell against USD (also referred to as being “LHS”) at the ECB Fix. A asked whether he should “stick other way” (i.e. change his position from LHS to RHS) and B replied, “yes”. A then said: “might be able to get you a lil ammo” (i.e. to help B build his RHS position) and at 08:08:29 (equivalent to 1:08 pm, London time) provided B with a further EUR 48 million to buy ahead of the ECB Fix. B confirmed after the ECB Fix that he had orders to buy EUR 330 million, but in total, he bought EUR 370 million ahead of the ECB Fix. B celebrated when the ECB Fix rate for the EUR/USD on this date was revealed to be 48, stating “yeeeeeeeeeeeeeeeeeeeah…48”. B stated that he bought EUR 370 million against USD at an average rate of 46.4. If B then sold that sum of EUR against USD at the ECB Fix rate of 48, he would have made a profit of 1.6 “pips”, which is equivalent to approximately USD $59,200.
Further, these are not isolated examples. As Mr Quinn QC described it with his cadenced phraseology, they are fibres of the fabric of facts exemplified in the schedules of particulars which support an inference that during the relevant period the respondents gave effect to the alleged CAUs to the benefit of one or more of them.
Further, it seems to me that the applicant requires discovery of additional materials, including the respondents’ transaction data, in order to further particularise the “giving effect” allegations.
Now the applicant sought discovery of an initial tranche of such transaction data at an earlier case management hearing. This course was resisted by all respondents except UBS. Barclays submitted that such data was not relevant and questioned its value for the purpose of the applicant particularising its claim. Citibank submitted that the applicant had more than enough in order to reframe its pleading without the transaction data. JPMorgan and NatWest were similarly intransigent.
In ultimately declining to make discovery orders at that time in respect of the transaction data of respondents other than UBS, I said:
I don’t think you need [transaction data] to get the pleadings in order. I can understand how it’s important to your forensic analysis. At this stage, given the objections to production by the second through to fifth respondents, and also Mr Caleo [QC]’s point, that he would like to put on material, I’m not inclined to give you, from the second through to fifth respondents, the transactional data…
In my view further and better particulars should be provided once the requisite transaction data and other material has been discovered.
The pleading of causation and loss
The respondents say that the applicant’s pleaded case on causation and loss is cursory. It is said that it fails to grapple with the number and variety of alleged CAUs that the applicant seeks to advance. It is expressed at a level of generality that does not provide any real explanation of how each of the alleged CAUs caused loss and damage to the applicant and the group members or of what the nature of that loss was.
I agree with the respondents’ criticisms to some extent.
As pleaded at [40], the applicant’s case on causation is that, by reason of the respondents’ contraventions, during the relevant period “Spreads were increased on all Affected Currency Pairs traded in the Global FX Market and/or the Australian FX Market” and the costs of entering FX Instruments in relation to Affected Currency Pairs were inflated or increased above what they would otherwise have been.
But as the respondents rightly say, these are vague and generalised allegations. No attempt is made to identify a causative link between any particular alleged CAU or series of CAUs and an effect on either Spreads or costs, even at a level of theory. And no attempt is made to identify categories or classes of Spreads or costs which may have been the subject of an effect or the nature or extent of the effect that is said to have arisen. As such, it is difficult to determine how it is alleged that the applicant or any particular member of the group has been affected by the impugned conduct.
As the respondents contend, it is incumbent upon the applicant to plead the material facts establishing this asserted causal link between, on the one hand, the respondents’ alleged contraventions and, on the other, the increase in Spreads on all Affected Currency Pairs and the inflation of costs in relation to all Affected Currency Pairs, respectively. That includes pleading the relevant counterfactual scenario on which the applicant relies.
But the applicant has not pleaded any material facts which would sustain its rolled up allegations. As the respondents correctly said, what has been alleged leaves numerous questions unanswered.
First, on what basis does the applicant contend that the alleged CAUs affected every combination of the Affected Currency Pairs on every day during the relevant period? For example, on what basis does the applicant contend that an understanding reached, for example, on 1 January 2008 in relation to Spreads or a Fix on that date inflated costs in relation to FX Instruments throughout the relevant period and up to 15 October 2013?
Second, on what basis does the applicant contend that an alleged understanding that had as its subject matter, for example, the USD/EUR Affected Currency Pair increased Spreads on any, let alone all, other Affected Currency Pairs?
Third, given that FX rates are significantly determined by supply and demand, on what basis does the applicant contend that the alleged conduct resulted in a loss (as opposed to a benefit in some cases) in respect of every FX Instrument traded during the relevant period?
I agree with the respondents that these matters are not explained or addressed in the PASOC.
Generally, in light of the plethora of cumulative and alternative allegations of CAUs and giving effect, it is difficult from the generalised particulars provided in [40] to identify the alleged effect of any particular conduct on the alleged loss and damage suffered by the group.
Further, the consequences of the applicant’s failure to identify a theory of loss or damage are acute in relation to the “WMR Fix Understanding(s)”, the “ECB Fix Understanding(s)” and the “Stop Loss Understanding(s)”, which involve alleged “activities to influence the price of the WMR Fix”, “activities to influence the price of the ECB Fix” and the alleged “manipulate[tion of] Spot Rates to trigger Stop Loss Orders” respectively. These alleged CAUs, and their corresponding “giving effect” allegations, appear to involve complaints about directional trading activities. On their face, none of the allegations concern Spreads and it is not self-evident that an effect on the price of an ECB Fix or WMR Fix or the triggering of a Stop Loss Order would result in an increase in the costs of entering into FX Instruments in relation to any or all Affected Currency Pairs.
Moreover, if it is assumed that one of the many alternative allegations regarding those CAUs could be made good and it could be established that one or more of the respondents gave effect to the CAU with a relevant directional impact on price, it would follow that some members of the group may have financially benefited from the relevant conduct.
Now the applicant makes the following points.
The applicant says that causation and loss in high-volume market transaction cases are conventionally, indeed necessarily, matters for expert evidence. It is therefore not incumbent upon the applicant at this stage of the proceeding to further particularise the loss theory it intends to establish at trial. And it says that it is appropriate for such particulars, if required, to be provided following the preparation of expert evidence.
Nevertheless, the applicant says that it has articulated at a general level in its affidavit material additional elements of the causation and loss theory likely to be developed by the applicant and group members through expert evidence. In short, the applicant intends to establish through expert evidence that giving effect to each of the “Information Sharing and Trade Co-ordination Understanding(s)”, the “WMR Fix Understanding(s)”, the “ECB Fix Understanding(s)” and the “Stop Loss Order Understanding(s)” caused loss and damage to the applicant and group members in the form of price artificiality and spread widening. Further, the applicant intends to establish through expert evidence that giving effect to the “Spread Understanding(s)” caused loss and damage to the applicant and group members in the form of directly and indirectly caused spread widening.
But I agree with the respondents that the applicant should now plead its causation and loss theory. And the fact that expert evidence will ultimately be served does not alter that broad requirement.
Indeed, the problems created by the deficiencies in the PASOC on this aspect are exemplified by Ms Kimi Nishimura’s seventh affidavit (at [31]), which states that the applicant proposes to rely upon a process described in delightfully vague terms as “triangular arbitrage”. That process is not identified in the PASOC or properly explained in her affidavit.
Now I accept that the applicant will require discovery of additional materials, including the respondents’ transaction data, as well as production of materials from third parties, in order to perform the kind of expert analysis and modelling it intends to rely upon at trial in support of its case on loss and damage.
But in my view, even at the present time the applicant should properly articulate at least the structural elements of its causation and loss and damage case. That may affect matters such as the ambit of any further document production to be given in the proceeding and the nature of the expert evidence to be called, including the relevant field of expertise required. Further and precise particulars can follow later.
GENERAL
Generally, the applicant has attempted to excuse deficiencies in the PASOC on the basis of an “information asymmetry” or lack of access to evidentiary materials. But in my view there are substantial problems with the PASOC in any event as I have set out.
I will refuse leave to replead in the terms presently sought by the applicant.

I certify that the preceding three hundred and thirteen (313) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Beach.
Associate:
Dated: 29 January 2021
SCHEDULE OF PARTIES

VID 567 of 2019

Respondents

Fourth Respondent:

JPMORGAN CHASE BANK N.A. (ABN 43 074 112 011)

Fifth Respondent:

NATWEST MARKETS PLC (SC090312)

File number:	VID 567 of 2019
Judgment of:	BEACH J
Date of judgment:	29 January 2021
Catchwords:	REPRESENTATIVE PROCEEDINGS – foreign currency instruments – alleged cartel conduct – corporations – practice and procedure – application to replead – group definition – numerous permutations and combinations of claims – pleading of alleged cartel understandings – availability of inferences to be drawn – application to replead refused
Legislation:	Competition and Consumer Act 2010 (Cth) ss 4E, 5, 44ZZRC, 44ZZRD, 44ZZRJ, 44ZZRK Federal Court of Australia Act 1976 (Cth) ss 33H, 33J, 33ZB, Pt IVA Trade Practices Act 1974 (Cth) ss 4E, 5, 45, 45A, 44ZZRC, 44ZZRD, 44ZZRJ, 44ZZRK
Cases cited:	Australian Competition and Consumer Commission v Olex Australia Pty Ltd [2017] FCA 222 Bray v F Hoffman-La Roche Ltd [2002] FCA 1405 Forrest v Australian Securities and Investments Commission (2012) 247 CLR 486 Hassid v Queensland Bulk Water Supply Authority t/as Seqwater [2017] NSWSC 599 IL v The Queen (2017) 262 CLR 268 Perera v GetSwift Ltd (2018) 263 FCR 92 Webster (Trustee) v Murray Goulburn Co-Operative Co. Ltd (No 2) [2017] FCA 1260 Wigmans v AMP Ltd (2019) 373 ALR 323
Division:	General Division
Registry:	Victoria
National Practice Area:	Commercial and Corporations
Sub-area:	Economic Regulator, Competition and Access
Number of paragraphs:	313
Date of hearing:	8 and 9 October 2020
Counsel for the Applicant:	Mr B Quinn QC with Ms E Levine
Solicitor for the Applicant:	Maurice Blackburn Lawyers
Counsel for the First Respondent:	Ms WA Harris QC with Mr MI Borsky QC, Mr J Kirkwood and Ms JD Williams
Solicitor for the First Respondent:	Herbert Smith Freehills
Counsel for the Second Respondent:	Mr C Caleo QC with Mr A Barraclough
Solicitor for the Second Respondent:	Clayton Utz
Counsel for the Third Respondent:	Mr M Darke SC with Mr J Arnott
Solicitor for the Third Respondent:	Allens
Counsel for the Fourth Respondent:	Mr S Lawrance with Mr D Blazer
Solicitor for the Fourth Respondent:	Allen & Overy
Counsel for the Fifth Respondent:	Mr C Moore SC with Mr N De Young QC and Mr M Sherman
Solicitor for the Fifth Respondent:	King & Wood Mallesons

ORDER MADE BY:	BEACH J
DATE OF ORDER:	29 JANUARY 2021

VID 567 of 2019
Respondents
Fourth Respondent:	JPMORGAN CHASE BANK N.A. (ABN 43 074 112 011)
Fifth Respondent:	NATWEST MARKETS PLC (SC090312)