PlayUp Limited v Mintas

Case [2022] FCA 892

FEDERAL COURT OF AUSTRALIA

PlayUp Limited v Mintas [2022] FCA 892  

File number: NSD 1247 of 2021
Judgment of: MARKOVIC J
Date of judgment: 3 August 2022
Catchwords: PRACTICE AND PROCEDURE – application for summary judgment or stay of the proceeding – whether the plaintiff has no reasonable prospect of successfully prosecuting the proceeding or part of the proceeding – whether the Court is an inappropriate forum in which to determine the dispute such that the proceeding should be stayed – application dismissed  
Legislation:

Corporations Act 2001 (Cth)

Federal Court of Australia Act 1976 (Cth) s 31A

Federal Court Rules 2011 (Cth) r 26.01

Cases cited:

Fair Work Ombudsman v Austrend International Pty Ltd (2018) 273 IR 439; [2018] FCA 171

Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197

Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538
Division: General Division
Registry: New South Wales
National Practice Area: Commercial and Corporations
Sub-area: Corporations and Corporate Insolvency
Number of paragraphs: 96
Date of hearing: 10 May 2022
Counsel for the Plaintiff: Ms S Mirzabegian SC with Ms K Sutton
Solicitor for the Plaintiff: Herbert Smith Freehills
Counsel for the Defendant: The Defendant appeared in person

ORDERS

NSD 1247 of 2021
BETWEEN:

PLAYUP LIMITED ACN 612 529 307

Plaintiff
AND:

DR LAILA MINTAS

Defendant

ORDER MADE BY:

MARKOVIC J

DATE OF ORDER:

3 AUGUST 2022

THE COURT ORDERS THAT:

1.The interlocutory application filed by the defendant on 3 March 2022 (Interlocutory Application) is dismissed.

2.The defendant pay the plaintiff’s costs of the Interlocutory Application.

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


REASONS FOR JUDGMENT

MARKOVIC J

  1. On 1 December 2021 the plaintiff, PlayUp Limited, commenced this proceeding by the filing of an originating application seeking orders against the defendant, Dr Laila Mintas, on an interim and final basis including orders pursuant to s 1324 of the Corporations Act 2001 (Cth) restraining Dr Mintas from denigrating or disparaging PlayUp, any of its associated entities, its officers or officers of its associated entities.

  2. On that day, on the ex parte application of PlayUp, the Court made orders pursuant to subs 1324(1)(a) and (4) of the Corporations Act restraining Dr Mintas, her servants and agents from publishing false or disparaging information about, or making false or disparaging statements to certain persons or entities in connection with PlayUp, until further order.

  3. On 3 February 2022 PlayUp filed an amended originating application and statement of claim. In its amended originating application PlayUp seeks additional relief including declarations of contravention of ss 181, 182 and 183 of the Corporations Act and compensation pursuant to s 1317H of the Corporations Act in relation to those alleged contraventions.

  4. In the meantime, on 30 November 2021 PlayUp Inc (PlayUp US), a wholly owned subsidiary of PlayUp, commenced case no. 2:21-cv-02129-GMN-NJK in the United States District Court, District of Nevada (Nevada Court) against Dr Mintas as defendant (US…

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Details
AGLC
PlayUp Limited v Mintas [2022] FCA 892
Case
[2022] FCA 892
Decision Date

CaseChat Overview and Summary

In the Federal Court, PlayUp Limited, an online wagering and entertainment business, sought to dismiss an interlocutory application filed by Dr Mintas, a former director, for summary judgment or a stay of proceedings. The application was premised on the existence of a parallel proceeding in the District Court of Nevada and the contention that the Australian Court was not the appropriate forum for the dispute. Dr Mintas, who was self-represented and not familiar with Australian law, supported her application with affidavits and documents from the Nevada proceeding. PlayUp, on the other hand, relied on affidavits from its directors and legal counsel to argue against the application. The central legal issues involved whether Dr Mintas had no reasonable prospect of successfully prosecuting the proceeding, and whether the Australian Court was an inappropriate forum for the dispute.

The Court assessed the affidavits and evidence presented by both parties, noting significant factual disputes regarding Dr Mintas' conduct as a director and its impact on PlayUp's proposed sale transaction with FTX. The Court found that these factual issues could only be resolved through a full hearing. Additionally, the Court considered that a temporary stay of the Australian proceeding pending resolution of the Nevada proceeding could cause significant delay. Given these considerations, the Court dismissed Dr Mintas' interlocutory application and ordered her to pay PlayUp's costs associated with the application.

The Court concluded that the parallel proceedings did not render the Australian Court an inappropriate forum, and that the factual disputes required a full hearing. Dr Mintas' application for summary judgment or a stay of proceedings was therefore dismissed, and she was ordered to pay PlayUp's costs.

Orders

Orders of the court

1. The interlocutory application filed by the defendant on 3 March 2022 (Interlocutory Application) is dismissed.

2. The defendant pay the plaintiff’s costs of the Interlocutory Application.

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

Background

Background to the litigation

On 3 March 2022 Dr Mintas filed an interlocutory application in this proceeding seeking orders that the proceeding be summarily dismissed “and/or [that] there is a parallel proceeding in the District Court of Nevada such that this Court is not the proper forum for the proceeding”. It is that application which is before the Court for determination. BACKGROUND In support of her interlocutory application Dr Mintas relied on two affidavits dated 1 March 2022 and 28 April 2022 and a bundle of documents from the US Proceeding. Dr Mintas qualified as a lawyer in Germany and practised as a commercial lawyer for three years before taking on other roles. She is self represented in this proceeding and, although a lawyer, is not familiar with Australian law and the rules which govern practice in this jurisdiction. Against that background, I make the following observations about Dr Mintas’ affidavits. First, PlayUp made substantial objections to the affidavits. However, rather than addressing each of the objections, they were admitted subject to PlayUp addressing me on the weight I would give to their contents. In that regard, I accept PlayUp’s submission that I would not give much weight to the contents of the affidavits save to the extent that they establish that there are a number of disputes about the facts which underpin the claims made by PlayUp in its statement of claim. Secondly, they contain material which is better described as submissions rather than evidence. To the extent that is so, and in the absence of Dr Mintas having filed any written submissions, I have taken those parts of her affidavits to constitute her submissions. PlayUp relied on:(1)an affidavit affirmed by Daniel Matthew Simic, one of its directors and the founder of the PlayUp Group (see [12] below), affirmed on 30 November 2021; (2)an affidavit affirmed by Ross Kenneth Benson, director of InvestorLink Group Limited, a shareholder in PlayUp, on 1 December 2021; (3)an affidavit sworn by Michael Dominic Costa, its chief technology officer, on 14 April 2022; (4)an affidavit sworn by Michael Steven Popok, executive managing partner of Zumpano, Patricios & Popok PLLC, legal counsel for PlayUp US in the US Proceeding, on 13 April 2022; and (5)an affidavit sworn by Ashley Maurice Kerr, its general counsel, on 9 May 2022. I set out below a summary of the facts relied on by the parties. In doing so I do not set out all of the evidence before me. However, a review of the evidence demonstrates that there are a number of factual disputes between PlayUp and Dr Mintas in relation to the allegations at the heart of this proceeding. The parties PlayUp is an unlisted public company incorporated in Australia with subsidiaries in multiple countries around the world including India and the United States. Its head office is in Sydney. PlayUp operates an online wagering and entertainment business by itself and through its subsidiaries (together the PlayUp Group), one of which is PlayUp US. The PlayUp Group holds betting licences in multiple jurisdictions, with its activities occurring principally in Australia, New Zealand, India and the United States of America (US or USA).

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Finally, as established by Mr Popok’s evidence, there is a real possibility that a temporary stay of this proceeding pending resolution of the US Proceeding would cause significant delay in the determination of this proceeding. Relevantly, Mr Popok says that the earliest the US Proceeding is likely to be determined is the end of 2023 but it could be as late as 2025, depending on whether the proceeding itself, or various interlocutory steps taken along the way, are the subject of appeal. CONCLUSION It follows that Dr Mintas’ interlocutory application filed on 1 March 2022 should be dismissed. As Dr Mintas has been unsuccessful she should pay PlayUp’s costs of that application. I will make orders accordingly.

Ratio Decidendi

Legal Principle Established

Dr Mintas again submitted that it does not make sense for the US Proceeding and this proceeding to run in parallel as this would result in “two discoveries in two countries that are for the same duties”. She further submitted that “everything that … the court is requesting in Australia has been requested in the US and the other way around.” In summary, Dr Mintas submitted that the claims in the US Proceeding and this proceeding are “identical”, save that the US Proceeding is subject to “Nevada law” and this proceeding is subject to “Corporations law” and that it would be illogical for there to be “two different cases on two different continents with two different consequences”. CONSIDERATION I will consider each of the claims for relief sought by Dr Mintas in her interlocutory application in turn.Should the proceeding be summarily dismissed? As set out above, in this proceeding PlayUp seeks relief under the Corporations Act. As I have already observed, PlayUp alleges that Dr Mintas breached her duties owed to it in her capacity as a director under ss 181, 182 and 183 of that Act. In broad terms there are two factual issues which will need to be resolved in order to determine PlayUp’s claim as pleaded: first, whether Dr Mintas engaged in conduct which compromised, interfered with and/or jeopardised the proposed sale transaction with FTX; and secondly, whether FTX withdrew from the transaction because of Dr Mintas’ conduct. In determining each of those issues the Court will, in turn, need to determine, as a matter of fact, what events led to FTX’s withdrawal from the transaction to acquire PlayUp. To illustrate that is so and the nature of the factual issues that will need to be considered, PlayUp provided me with a document titled “Aide Memoire – factual matters in contest”. The Aide Memoire identified, by reference to the affidavits filed and served by each of PlayUp and Dr Mintas to date, the factual matters that are in contest between the parties and the available evidence which goes to those factual issues. It is apparent from that analysis that there are numerous factual issues to be resolved between the parties including for example: why Dr Mintas was asked not to attend the meeting with FTX in the Bahamas; how Dr Mintas came to attend a separate meeting with representatives of FTX in the Bahamas; whether that latter meeting compromised the proposed transaction with FTX; what factors led FTX to withdraw from the transaction and so on. In relation to each of those issues there is a factual contest based on the evidence filed to date. That that is so is not only evident from the Aide Memoire provided by PlayUp but from a review of Dr Mintas’ affidavits in which she disputes a significant proportion of the factual matters relied on by PlayUp and puts a different complexion on, or makes a different analysis of, those facts. Those factual disputes can only be resolved after a hearing, with the benefit of hearing and considering the oral and documentary evidence.