Oxygen Air Ltd v LG Electronics Australia Pty Ltd
[2017] NZHC 1857
•22 August 2017
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2015-404-2184 [2017] NZHC 1857
BETWEEN OXYGEN AIR LIMITED
Plaintiff
AND
LG ELECTRONICS AUSTRALIA PTY LIMITED
Defendant
Hearing: 31 July 2017 Appearances:
M C Black for Plaintiff
M Gavin/T Mahood for DefendantJudgment:
22 August 2017
JUDGMENT OF ASSOCIATE JUDGE R M BELL
This judgment was delivered by me on 22 August 2017 at 2:00pm
pursuant to Rule 11.5 of the High Court Rules
………………………………………………….
Registrar/Deputy Registrar
Solicitors:
Craig Griffin Lord (Ch Lord), Auckland, for the Plaintiff
Hudson Gavin martin (Mark Gavin/Tim Mahood), Auckland, for the Defendant
Copy for:
Michael C Black, Auckland, for the Plaintiff
OXYGEN AIR LIMITED v LG ELECTRONICS AUSTRALIA PTY LIMITED [2017] NZHC 1857 [22 August
2017]
[1] The plaintiff chafes at restrictions on confidentiality grounds the defendant has imposed on inspection of its discovered documents. The plaintiff applies for orders setting-aside the defendant’s claims to confidentiality and for directions as to inspection of the documents claimed to be confidential. In particular it wants its director to be able to inspect the documents in person, something the defendant objects to very strongly.
What the case is about
[2] The defendant, LG Electronics Australia Pty Ltd, is the Australasian supplier for a South Korean company that makes a wide range of electrical goods including air-conditioning systems, heat-pumps and solar panels. It is an Australian corporation also registered in New Zealand on the overseas register and carries on business supplying LG products in Australia, New Zealand and the Pacific. The plaintiff, Oxygen Air Ltd, distributes and installs air-condition and heat-pump systems in New Zealand. Its sole director and shareholder is Mr Eddy Rotteveel.
[3] In February 2010 LG Electronics and Oxygen Air Ltd made a written supply and distribution agreement. The products supplied are “various heating and air- conditioning products including (without limitation) residential and commercial heat-pumps and ducted air-conditioning”. LG Electronics gave Oxygen Air Supply Ltd an exclusive distributorship of the products in New Zealand and the Pacific Islands (but with certain exceptions). The term was for four years with two further rights of renewal over four years each unless agreed otherwise in writing.
[4] Oxygen Air says that LG Electronics breached the distributorship agreement by not delivering products on time in accordance with its orders, delivering mis- matched stock and stock missing essential components, not providing LG star certification. It also alleges breach of the exclusivity provisions by making arrangements with other businesses to sell its air-conditioning and other products in New Zealand, and arranging with a Fiji business to distribute its products in that country and supplying second-hand units to other New Zealand outlets. It also alleges that LG Electronics did not remedy or address warranty claims in an
acceptable time, and that LG Electronics did not provide marketing promotional or technical support as required under the agreement.
[5] In its first cause of action, Oxygen Air Ltd sues LG Electronics for breach of contract, claiming damages for loss of profit on air-conditioning stock, loss of future profits and income for the duration of the agreement until 2022, for alleged loss of value, for expenditure incurred in reliance on the distribution agreement, wasted expenditure on costs and signage. All up, it is seeking damages of some $2 million. It also seeks the taking of accounts for all sales and profits derived by LG Electronics in breach of the exclusivity terms of the distribution agreement.
[6] The three other causes of action in the statement of claim relate to solar panels. In the second cause of action, Oxygen Air Ltd says that in October 2013 LG Electronics granted it the New Zealand distribution rights for LG solar panels. It had discussions with Harrisons, one of its long-standing and largest customers, with a view to selling LG Electronics’ solar panels in New Zealand. However, LG Electronics appointed Harrisons as its New Zealand distributor of its solar panels. Oxygen Air sues for breach of the agreement that it was to have the solar panels distributorship. It claims that its contract was wrongfully terminated in April/May
2014 when Harrisons was appointed the exclusive distributor for New Zealand. It says it was entitled to two years’ notice of termination. It claims that the loss of the solar panel business for the two years was $291,066. For relief, it seeks an enquiry into damages including an order for the taking of account to determine the profits and gains derived by LG Electronics in distributing the solar panels through Harrisons.
[7] The third cause of action, in the alternative to the second, is for breach of a collateral contract. It seeks the same relief as the second. The fourth cause of action is a claim under the Fair Trading Act 1986, based on representations made by employees of LG Electronics that Oxygen Air would have the New Zealand distributorship for solar panels. That cause of action seeks damages alone under s 43 of the Fair Trading Act. An unusual feature of Oxygen Air Ltd’s pleadings is the claim for accounts for profits on causes of action based on breach of contract. That has led to some of the discovery difficulties.
[8] LG Electronics denies all the breaches of the distribution agreement for air- conditioning and heat-pumps. It denies that it agreed to give Oxygen Air distribution rights for its solar products in New Zealand. It counterclaims for unpaid invoices for
$583,000 that are now more than two years old. It also says that Oxygen Air Ltd did not hold proceeds of sale on trust for it, as required. It sues for breach of trust and breach of fiduciary obligation.
Discovery by LG Electronics
[9] The first case management conference on 15 March 2016 grappled with terms for a tailored discovery order. LG Electronics provided a draft order. Oxygen Air Ltd was not satisfied with its terms and sought wider discovery. It was not possible to resolve matters within the allotted time (one-and-a-quarter hours). A fresh conference was allocated for 23 March 2016. Again, complete agreement was not reached despite discussion. Eventually the parties submitted a joint memorandum and I made orders in terms of that memorandum on 18 April 2016. I was relieved that the parties had resolved matters themselves and did not scrutinise the terms closely. The scope of discovery had been widened considerably from LG Electronics’ initial proposal. It was understood that enquiries would need to be made in Australia as well as in New Zealand and it would be necessary to search LG Electronics’ employees’ individual computers for relevant documents as well as its primary database management system.
[10] The detailed tailored discovery order of 18 April 2016 runs for 54 paragraphs. The categories of documents to be disclosed are listed in 34 paragraphs (3-33). LG Electronics undertook to search all available electronic records of identified personnel, using identified search terms within identified date ranges, as well as searching its primary database management systems. The particular categories of documents to be disclosed are listed under these headings:
(a) general;
(b) air-conditioning dispute;
(c) solar panel dispute; (d) financial records; and (e) transactional records.
[11] Transactional records are defined as any purchase order, invoice, statement, remittance or shipping document relating to a LG Electronics’ product. The order recognised that disclosing each transactional document would be disproportionate. Transactional documents were to be provided in summary form by way of a database extract where possible. Where summary reports could not be produced, individual documents would be listed. Where particular transactional documents are themselves in issue, those were to be individually listed and exchanged. The parties had the right to requisition transactional documents that were individually listed.
[12] Paragraph 36 required the listing for each document to give a unique alphanumeric reference, the date of the document, document type, author, author company, recipient, parent document reference, native document file, privilege category and redaction reason. Paragraph 39 required that documents be listed in chronological order (but any attachments should appear immediately after the parent document). Undated documents would appear first in the list. The order contains a glossary of terms.
[13] The financial records were to include:
27. LG’s sales reports of LG products in the territory from
1 February 2010 to the date of the discovery order.
28.LG’s reports of profitability, by customer, disclosing its profits made from the sale of LG products in the territory to Harrisons, to New Zealand Clean Energy Solutions, and to any other party identified from the sales reports required by category 27.
29.A breakdown of Oxygen’s annual revenue by brand of product sold in relation to its business between 1 April 2009 and the date of the discovery order.
[14] Although the order did not specifically say so, the parties remained under the continuing obligations in r 8.18 of the High Court Rules including the requirement in r 8.18(2) to discover documents the party became aware of while carrying out tailored discovery, even if that document was not required to be discovered under the order.
[15] LG Electronics required extensions of time to complete discovery. The task was more complex and took more time than expected. Its affidavit of documents of November 2016 has listed about 13,000 documents. As to confidential documents, it says:
In Part 3 of the schedule, I list the documents that are in the control of the defendant and for which the defendant claims confidentiality. I propose that inspection of these documents be restricted to counsel and instructing solicitors for the plaintiff and that the following restrictions apply:
(a) Each person is to provide a confidentiality undertaking in an agreed form; and
(b) the confidentiality undertaking shall require that person to preserve the confidentiality of each document except where such disclosure has been agreed by the defendant or as otherwise directed by the Court or required by any law, rule or regulation.
The parties disagree on the number of confidential documents. LG Electronics says that there are about 3,500 but Oxygen Air says that there are many more.
[16] The documents for which confidentiality is claimed are described in an affidavit for this application:
24. I confirm that the majority of the documents listed as confidential are sales progress reports and the related email that sends this report internally within the defendant. These reports are Excel spreadsheets which cover the full range of the defendant’s products, for example, AV, mobile, LCD, TV, cooking and cleaning, washing machines, monitors that are available in the market in both Australia and in New Zealand. There is also a significant number of reports which relate to the defendant’s solar product and its supply to various dealers throughout Australia and New Zealand, although they primarily relate to the Australian market.
25. I confirm that the confidential documents also include a number of reports that cover various matters, including LTI (long-term inventory), daily sales and order reports which include the defendant’s gross profits and operating income, profit simulations and budgets. These reports are generic reports which the defendant generates and they relate to a range of the defendant’s products available in the Australian and New Zealand market. They are not limited to the matters that are in dispute in this proceeding.
26. I confirm that the remaining confidential documents include monthly sales figures and other commercially sensitive material in respect of the defendant or third party’s with whom it deals.
The deponent says that the documents are unredacted and contain information relating to third parties – for example, other retailers, which is commercially sensitive to those parties and that its internal margins and pricing are highly confidential to it.
Inspection
[17] Inspection of the documents has not gone smoothly. The lawyers for Oxygen Air Ltd have not given undertakings and have accordingly not inspected any of the confidential documents. They say that they will inspect documents only if they can discuss them with their client. Oxygen Air Ltd has instructed its normal accountant, Mr Lockhart, to inspect the confidential documents. He gave a confidentiality undertaking acceptable to LG Electronics and has been provided with copies of documents but he complains of practical difficulties in opening documents and understanding them. Oxygen Air Ltd seeks an order allowing Mr Rotteveel to see the documents. Mr Lockhart says that it is essential that he have Mr Rotteveel’s assistance. Mr Lockhart does not understand much of the coding and private terminology used by LG Electronics in its records. Mr Rotteveel, on the other hand, has dealt with LG Electronics and would understand the documents.
[18] On the other hand, LG Electronics objects strongly to Mr Rotteveel having access to the confidential documents. It says that Mr Rotteveel is now in direct competition against it. Oxygen Air is no longer ordering air-conditioning products under the distribution agreement. The last order received from Oxygen Air was about May 2016. That was for a wireless remote. As Oxygen Air is no longer ordering air-conditioning products from LG Electronics, LG Electronics essentially
has no air-conditioning business operating in New Zealand. Mr Rotteveel has changed the plaintiff ’s name to “LG Air Ltd”. He has another company, Oxygen NZ Ltd. That company is the authorised distributor of Fujitsu air-conditioning products. Oxygen NZ Ltd is also distributing Panasonic, Carrier and Aspen air-conditioning heat-pump brands, all of which are in competition with LG Electronics’ products.
[19] The parties have corresponded and met to deal with the discovery and inspection issues, but did not resolve all issues. This application has followed. It is unnecessary for this decision to go into those discussions.
The confidentiality undertaking required by LG Electronics
[20] LG Electronics requires any agent of Oxygen Air Ltd who will inspect the confidential documents to give this undertaking as to confidentiality:
I, [name] of [place], [occupation], undertake, subject to any orders of the court or further agreement by the defendant, in relation to the documents listed on Part 3 of the affidavit of Toolendrie Soud, dated 17 November 2016 in which confidentiality is claimed (“the confidential documents”) and which are discovered pursuant to the order of Associate Judge Bell dated 18 April
2016:
1. I will inspect the confidential documents solely for the purpose of proceeding CIV-2015-404-2184 (the “proceeding”).
2. Any copies I receive of the confidential documents, and any notes which I make, and knowledge I gain, of the contents of the documents will be used solely for the purpose of this proceeding.
3. Subject to 4 below, I will safeguard the confidential documents and any copies thereof and will not at any time disclose the confidential documents or copies or the contents therefore, in whole or in part, to any person without first obtaining the consent of the defendant in this proceeding, or an order of the court allowing disclosure or required by any law, rule, or regulation to do so.
4. I may discloses the content of the confidential documents or of any copies to, and discuss the contents of the confidential documents with the court or any person who has been permitted to inspect the confidential documents and who has first provided a signed undertaking in this form to the solicitor acting for the defendant in this proceeding.
5. If any of the confidential documents are scanned or imaged and converted to electronic form, for the purpose of the proceeding, these will be held by me in a secure form, and will not be further copies or transmitted and will remain in my possession and subject to my control at all times.
6. All confidential documents and any copies of confidential documents that have been provided by the defendant or that have not been incorporated in:
(a) any brief of evidence or affidavit filed in this proceeding;
(b) in answer to any questions put in the course of giving evidence in this proceeding; or
(c) incorporated in any submissions made to the court in this proceeding;
will be deleted from any hard drive or any form of electronic storage in my control and all or any hard drives will be returned to the solicitors for the defendant or securely destroyed upon final disposal or resolution of this proceeding.
Dated this ………………… day of ……………….. 2017
To: The defendant
So far only a legal assistant and Mr Lockhart have signed the undertaking.
Oxygen Air’s application
[21] Oxygen Air Ltd seeks eight orders relating to confidentiality and inspection. On the whole, they are stated generally. For example, the first four orders sought are:
(a) that the defendant’s claim to confidentiality made in part 3 of its affidavit of documents be set aside, reviewed or modified and such other orders be made with respect to enabling inspection of that class of documents;
(b)that directions be made entitling the plaintiff to inspect the approximately 5,000 documents claimed to be confidential under Part
3 and on such terms and orders as this court considers appropriate in order to facilitate the inspection of those documents;
(c) that the court makes such further directions or orders as are necessary in relation to the allegedly confidential documents, to assess and
identify the individual grounds for claiming confidentiality of the documents; and
(d)that the court make such directions as are necessary to ensure co- operation, proportionality, cost-effectiveness and that practical arrangements occur in the inspection of those documents.
[22] In submissions, Oxygen Air Ltd sought these directions (among others):
(a) that Mr Rotteveel be allowed to inspect the documents so as to assist
LG Electronics’ accountant;
(b)an order directing the documents to be arranged individually in categories or otherwise identified so as to facilitate the inspection of documents; and
(c) directions to allow for co-operation, proportionality, efficiency and practicality in inspecting documents and files. That is to include directions to remove restrictions on inspection, remove duplicates and reduce unnecessary disclosure as well as such other directions as seem appropriate to the court.
[23] To a large extent, Oxygen Air Ltd complains about difficulties in inspecting documents, especially those for which confidentiality was claimed, but leaves the court to give such directions as seem appropriate.
Mr Lockhart’s difficulties
[24] Mr Lockhart gave a confidentiality undertaking in the terms proposed by LG Electronics but with a reservation which allowed the restrictions under the undertaking to be relaxed by the court. He is an experienced chartered accountant in public practice and provides accounting services to Oxygen Air Ltd. His evidence does not suggest that he is normally engaged to provide accounting assistance for litigation. While he has spent a lot of time inspecting LG Electronics’ confidential
documents, not all of it has been spent usefully. He holds LG Electronics responsible for those difficulties. His complaints include the following:
(a) documents are hard to decipher;
(b) many of the documents are irrelevant;
(c) he does not understand the stock codes used by LG Electronics;
(d)he is unable to distinguish documents relating to solar panel financial information from information relating to other products;
(e) there are far more than 3,580 confidential documents – he suggests approximately 5,000;
(f) many documents are duplicated – some of the documents supplied on a UBS stick were corrupted, unprintable, incomplete, not able to be opened or referred to other documents;
(g) some of the documents were in Mandarin; (h) the ordering of documents was unhelpful;
(i) while the LG Electronics’ lawyers helped him with some codes, there
are others which he does not understand;
(j) there has been over-discovery by LG Electronics;
(k)LG Electronics has adopted a deliberate policy of obfuscation – he has spent a long time inspecting documents to no useful effect;
(l)it is unduly burdensome to print out Excel files and while he was able to find documents showing sales of solar products, the values of the sales were not listed;
(m)some sales reports showed sales within New Zealand with no description of the product or the time frames; and
(n)there were no attachments for email correspondence which referred to attachments.
[25] LG Electronics notes these points (amongst others) about Mr Lockhart’s
complaints:
(a) Its affidavit of documents is in the form required by the order of 18
April 2016;
(b)Electronic discovery including exchanging Excel spreadsheets in native format has been commonplace for several years and was the method approved by the parties;
(c) It is not required to provide an electronic user-friendly platform to identify, detail and understand the basis of what has been provided;
(d)The documents were provided in a format that could be used by any e- discovery platform;
(e) The confidential documents provided to Mr Lockhart were in a fully text searchable PDF format as required by the rules and the discovery order;
(f) the documents were provided in their native form, enabling the content to be manipulated to ascertain the pertinent material to allow Oxygen Air Ltd to identify its losses and particularise its claim;
(g)Mr Lockhart clearly did not know how to use electronic discovery tools and therefore worked inefficiently.
(h)It has provided Mr Lockhart with a glossary of terms to assist him with his review, and is willing to provide further information along those lines;
(i)A problem with the export of some confidential documents was identified – some 886 PDF files were left out although they have since been supplied to Mr Lockhart; and
(j)LG Electronics was not aware of Mr Lockhart’s problems until it received his first affidavit.
Rules and principles
[26] Here are some of the particular rules relevant to confidentiality and inspection. Rule 8.2 of the High Court Rules emphasises co-operation:
8.2 Co-operation
(1) The parties must co-operate to ensure that the processes of discovery and inspection are—
(a) proportionate to the subject matter of the proceeding; and
(b) facilitated by agreement on practical arrangements. (2) The parties must, when appropriate,—
(a) consider options to reduce the scope and burden of discovery; and
(b) achieve reciprocity in the electronic format and processes of discovery and inspection; and
(c) ensure technology is used efficiently and effectively; and
(d) employ a format compatible with the subsequent preparation of an electronic bundle of documents for use at trial.
[27] Under r 8.15(2)(f) an affidavit of documents must state any restrictions imposed to protect the claimed confidentiality of any documents. Under r 8.28(3) a party may limit inspection of documents to the persons specified in the affidavit, subject to restrictions imposed in the affidavit. Rule 8.25 provides that on applications to challenge a confidentiality claim, the court may set aside the claim,
modify it or make other orders with respect to the document. The Judge may inspect the documents to decide the validity of the confidentiality claim, but I have not done so in this case, given the large number of documents. Unlike privilege, confidentiality does not provide grounds for resisting disclosure in a documents affidavit, but may provide grounds for restricting inspection of the documents.
[28] Under r 8.29 the court may make orders to facilitate the efficient inspection of documents. That may include directions to arrange documents in a stated manner or order, and to assist the parties inspecting the documents to locate and identify particular documents or groups of documents.
[29] The use of documents produced for inspection is restricted both under the general law and under r 8.30(4):
(4) A party who obtains a document by way of inspection or who makes a copy of a document under this rule—
(a) may use that document or copy only for the purposes of the proceeding; and
(b) except for the purposes of the proceeding, must not make it available to any other person (unless it has been read out in open court).
Compliance with this rule is important to maintain confidence in the discovery process. That bar on collateral use applies whether documents are confidential or not. Applying restrictions when confidential documents are made available for inspection on procedural discovery is directed at ensuring greater protection against collateral use of information and documents where the information would ordinarily not be available to the public. Different levels of protection may be required according to the information in particular documents.
[30] In cases where confidentiality is claimed, it is necessary to strike a balance between legitimate but competing considerations: the need to allow one side to have adequate access to documents relevant to the proceeding and the need to protect the
other side from improper use of those documents following discovery. In Port
Nelson Ltd v Commerce Commission, the Court of Appeal said:1
The ability of each party to a proceeding to inspect the documents of the other, except for documents which are privileged, is important in enabling the proceeding to be brought to a just conclusion. It avoids parties being taken by surprise. It enables legal advisers to better assess the likely outcome of trial, and to concentrate on what will ultimately prove to be the real issues. In this way it can save cost. Sometimes, however, relevant documents which are not privileged may be commercially sensitive. Examples would be documents showing the detailed costings of products or services which are provided in a competitive market, the marketing plans for a proposed new product, or a patent specification during the period before the application has been accepted and made available for inspection.
The court went on to note that there are different ways by which the confidentiality may be preserved, while allowing them to be inspected by the other side. It added:2
It is a matter of balancing on the one hand the interests of justice in ensuring that the commission is able to prepare and present its case, and on the other the interests of Port Nelson in safeguarding its confidential information in a competitive market.
And further on:
An order for non-disclosure can only be made when the Court is satisfied in terms of r 312 that such an order is “necessary”. It must be either apparent from the document in question or shown by other evidence that disclosure would be likely to prejudice the party in some significant way. Even the possibility of prejudice may be sufficient, but that will depend on the seriousness of the possible prejudice and on the significance of the document to the issue in the proceeding, and the extent to which limited disclosure may enable the concerns of both parties to be accommodated.
It also stated that documents must be approached on a one-by-one basis, and:
This is the responsibility of counsel. In the vast majority of cases counsel should be able to agree whether or not a document is such as to require special protection, bearing in mind the restrictions on the use of discovered documents which apply in any event. Where there is some genuine point of difference which warrants referral to the Court, then the Judge can decide. Such referrals should be rare where experienced counsel are involved.
[31] In Intergroup NZ Ltd v Naked Bus NZ Ltd Asher J referred to s 69 of the
Evidence Act 2006 under which, for determining the admissibility of evidence, the
1 Port Nelson Ltd v Commerce Commission (1994) 7 PRNZ 344 (CA) at 347.
court has an overriding discretion as to confidential information.3 While noting the differences that discovery takes place before the hearing and involves the parties only, Asher J treated s 69 as relevant at the discovery stage. He noted the balancing required under s 69(3):
69 Overriding discretion as to confidential information
(3) When considering whether to give a direction under this section, the
Judge must have regard to—
(a) the likely extent of harm that may result from the disclosure of the communication or information; and
(b) the nature of the communication or information and its likely importance in the proceeding; and
(c) the nature of the proceeding; and
(d) the availability or possible availability of other means of obtaining evidence of the communication or information; and
(e) the availability of means of preventing or restricting public disclosure of the evidence if the evidence is given; and
(f) the sensitivity of the evidence, having regard to—
(i) the time that has elapsed since the communication was made or the information was compiled or prepared; and
(ii) the extent to which the information has already been disclosed to other persons; and
(g) society’s interest in protecting the privacy of victims of offences and, in particular, victims of sexual offences.
[32] There is also guidance from English practice. In Roussel Uclaf v ICI plc
Aldous J said:4
Each case has to be decided on its own facts and the broad principle must be that the Court has the task of deciding how justice can be achieved taking into account the rights and needs of the parties. The object to be achieved is that the applicant should have as full a degree of disclosure as will be consistent with adequate protection of the secret. In so doing, the Court will be careful not to expose a party to any unnecessary risk of its trade secrets leaking to or being used by competitors. What is necessary or unnecessary will depend upon the nature of the secret, the position of the parties and the extent of the disclosure ordered. However, it would be exceptional to
3 Intergroup NZ Ltd v Naked Bus NZ Ltd [2014] NZHC 124, [2014] 3 NZLR 177.
prevent a party from access to information which would play a substantial in the case, as such would mean that the party would be unable to hear a substantial part of the case, and would be unable to understand the reasons for the advice given to him and, in some cases, the reasons for the judgment. Thus what disclosure is necessary entails not only practical matters arising in the conduct of a case but also the general position that a party should know the case he has to meet, should hear matters given in evidence and understand the reasons for the judgment.
[33] The text “Disclosure” shows a variety of approaches to protecting the confidentiality of documents:5 inspection by an independent solicitor reporting directly to the court, inspection by the plaintiff’s experts but not the plaintiff, inspection by the plaintiff’s lawyers but not the plaintiff. Where a plaintiff has not been allowed to inspect, sometimes an order has been made permitting a report in general terms to him. The text goes on:6
In modern times, however, it is rare that the claimant himself, (or, where the claimant is a corporate body, a named officer) is excluded from knowledge, because decisions whether to continue or abandon the action, for example, should be made by the claimant, and not by his advisers. Sometimes he may only inspect under strict conditions. But exceptional cases do occur from time to time. It is increasingly common to create a “confidentiality club” of specified persons who alone may have access to the documents…As to who should be in the confidentiality club with access to the confidential material, there may be an issue whether it should extend beyond external lawyers.
Assessing the confidentiality claims
[34] While the Court of Appeal recommended in Port Nelson v Commerce Commission that a judge should inspect documents alleged to be confidential, it was dealing with only 58 documents. Here there are thousands. Neither side suggested that I should look at each and every document to determine its confidentiality.
[35] Oxygen Air Ltd does not directly challenge the claim to confidentiality as such, but tends rather to play down the risk to LG Electronics in Mr Rotteveel having access to the documents. Mr Lockhart, the accountant instructed by Oxygen Air Ltd, who has inspected the documents, argues that as Oxygen Air is not in the solar panel business, there can be no prejudice to LG Electronics in Oxygen Air
having open access to those documents. The merits of that argument are considered
5 Paul Matthews and Hodge M Malek Disclosure (5th ed, Sweet and Maxwell London, 2017) at
479-480.
6 Above at 480.
later. Here, the question is simply whether the documents described in LG Electronics’ evidence have the required degree of confidentiality so as to warrant extra protection.
[36] In the absence of contrary suggestions, especially from Mr Lockhart who has inspected the documents for Oxygen Air Ltd, I accept that the documents for which LG Electronics has claimed confidentiality either:
(a) contain information held only within the LG group of companies, that they would not otherwise wish to share with the public at large and that are important to them for the conduct of their business; or
(b)contain information given to it by third parties (distributors such as Harrisons, for example) on a confidential basis and not meant for further publication.
[37] I accept that documents containing details of internal margins and pricing are highly confidential to LG Electronics. Some of the information may be of little interest to the public at large but may be valuable in the hands of LG Electronics’ competitors.
A relevance question
[38] LG Electronics has included in its discovery affidavit highly confidential documents in categories 28 and 29 of the discovery order relating to its gross profits and operating income, profit margins and budgets. The need to protect the information in these documents has to a large extent driven LG Electronics to restrict inspection and to object to Mr Rotteveel seeing them. The only reason for including these documents in discovery is Oxygen Air Ltd’s claims for accounts of profits in its prayers for relief in the first, second and third causes of action. The profits targeted are those made by LG Electronics on sales to other distributors in alleged breach of exclusivity terms. Oxygen Air’s bid for accounts for profits is misconceived. It will never obtain any such orders. LG Electronics therefore did not have to disclose these documents and Oxygen Air does not need to inspect them.
[39] Normally in a dispute between a supplier and a distributor over breaches of contract, the primary remedy is damages. Mr Black, however, cites Attorney- General v Blake7 as authority that Oxygen Air Ltd is entitled to claim an account for profits. That case did acknowledge that in exceptional circumstances an account for profits may be available in a claim for breach of contract. There the defendant, a former member of the Secret Intelligence Service bound by the Official Secrets Act, wrote a book containing information he was required to keep secret. The House of Lords held that the British Government could recover the royalties he was to be paid. The following part of the speech of Lord Nicholls is important:8
The main argument against the availability of an account for profits as a remedy for breach of contract is that the circumstances where this remedy may be granted will be uncertain. This will have an unsettling effect on commercial contracts where certainty is important. I do not think these fears are well founded. I see no reason why, in practice, the availability of the remedy of an account of profits need disturb settled expectations in the commercial or consumer world. An account of profits will be appropriate in exceptional circumstances. Normally the remedies of damages, specific performance and injunction, coupled with the characterisation of some contractual obligations as fiduciary, will provide an adequate response to a breach of contract. It will be only in exceptional cases, where those remedies are inadequate, that any question of accounting for profits will arise. No fixed rules can be prescribed. The court will have regard to all the circumstances, including the subject matter of the contract, the purpose of the contractual provision which has been breached, the circumstances in which the breach occurred, the consequences of the breach and the circumstances in which relief is being sought. A useful general guide, although not exhaustive, is whether the plaintiff had a legitimate interest in preventing the defendant’s profit-making activity and, hence, in depriving him of his profit.
[40] That provides no support for Oxygen Air Ltd to claim an account of profits. In the first cause of action, there is a claim for account of profits derived by LG Electronics for breaches of the exclusivity term. The breaches are said to involve the supply of products outside New Zealand and selling second-hand units to outlets in New Zealand. Presumably, if a breach is proved, Oxygen Air Ltd will have a claim in damages that, but for the sales made by LG Electronics, it would have made those sales itself. The measure of damages will be the profit it would have made on those sales less the usual deduction for variable costs saved. Those damages for lost
profits meet the requirements of the case. That standard common law remedy in a
7 Attorney-General v Blake [2001] 1 AC 268 (HL).
commercial dispute is an adequate response to that breach of contract. Given the importance of recognising and following settled expectations, there is no need to waste time and effort on an account for profits. While Oxygen Air Ltd might object to sales in breach of the exclusivity term, it cannot have a legitimate complaint against LG Electronics making profits from the supply of its products. It has no basis for claiming any of LG Electronics’ profits.
[41] For the second cause of action, based on a breach of the alleged agreement as to solar products, Oxygen Air Ltd seeks a taking of accounts to determine profits and gains derived by LG Electronics in distributing and selling solar panels in New Zealand with Harrisons, for such term as the court may determine. If Oxygen Air Ltd proves the contract for the solar panels distributorship, its case will be that it was entitled to reasonable notice of termination. I understand that it will contend for one
year or two years’ notice. In Paper Reclaim Ltd v Aotearoa International Ltd9 the
Supreme Court quoted the Privy Council in Australian Blue Metal Ltd v Hughes:10
That does not mean that the reasonable time is the time during which one party or the other could reasonably wish for the contract to continue. It is unlikely that when the notice is given the parties could agree on that. The reasons which led one party to desire a long notice would move the other to desire a short one. The implication of reasonable notice is intended to serve only the common purpose of the parties. Whether there need be any notice at all, and, if so, the common purpose for which it is required, are matters to be determined as at the date of the contract; the reasonable time for the fulfilment of the purpose is a matter to be determined as at the date of the notice. The common purpose is frequently derived from the desire that both parties may be expected to have to cushion themselves against sudden change, giving themselves time to make alternative arrangements of a sort similar to those which are being terminated.
[42] In Paper Reclaim Ltd, the Supreme Court upheld the Court of Appeal’s finding that 12 months would have given Aotearoa sufficient breathing space in which to take stock of its situation to complete ongoing work under the contract and explore any opportunities which might exist. If less than reasonable notice has been given, there may be a claim for damages for losses suffered. That may include profits that could have been earned during the period of notice. At present, it appears that the solar panel distributorship was still in its early days. The pleadings do not
suggest a long-running distributorship where significant restructuring would be
9 Paper Reclaim Ltd v Aotearoa International Ltd [2007] NZSC 26, [2007] 3 NZLR 169.
required. But that, of course, is a matter for trial. What is clear is that there can be no basis for Oxygen Air Ltd to claim LG Electronics’ profits made on its sale of solar panels to Harrisons. That clearly does not come within the exceptional circumstances contemplated by Lord Nicholls in Attorney-General v Blake.
[43] If LG Electronics had complied with its contract, as Oxygen Air Ltd contends, LG Electronics would be entitled to make and retain profits on sales of its solar panels to Oxygen Air. Oxygen Air could have not have a legitimate interest in preventing LG Electronics from making a profit from the supply of its solar panels to it. In fact, the converse is the case. It has a legitimate interest in LG Electronics operating profitably so that the supply can be maintained. Equally, Oxygen Air can have no legitimate objection to LG Electronics selling solar panels profitably to another New Zealand distributor. Its only objection is that it was not given sufficient notice of termination and for that ordinary contract principles apply. Again, damages are an adequate remedy. The same analysis applies to the third cause of action, a claim for breach of a collateral contract. The fourth cause of action, under the Fair Trading Act, seeks a compensatory order only. An account of profits is not available under the Fair Trading Act.
[44] Accordingly the claims for accounts of profits in the first three causes of action can be put to one side, because Oxygen Air Ltd will never obtain that relief, even if it succeeds on liability. Consequently, it was unnecessary for LG Electronics to disclose documents relating to the profitability of any sales made in breach of any alleged distributorships, either for heating and ventilation equipment or for solar panels. Oxygen Air Ltd cannot have any legitimate ground for inspecting the records of LG Electronics that go only to the profits on its sales. That takes out of contention those documents which LG Electronics claims to be highly confidential. They are protected from inspection because they are not relevant.
[45] Other documents in the control of LG Electronics may be relevant to Oxygen Air’s damages claims. On the basis that Oxygen Air Ltd can claim damages for the loss of its own profits on the sales it was denied through any breach of an exclusivity term, it is entitled to discovery of records of sales of products covered by the exclusivity terms. Records of sales of heating and ventilation equipment alleged to
be in breach of any exclusive distributorship terms will show prices and quantities. They may be used as part of Oxygen Air’s calculation of its own losses. But it is unnecessary for Oxygen Air to know LG Electronics’ profit margin or to see documents going to profitability, internal profits, gross profit margins and the like.
[46] The same applies to documents dealing with the sale of solar panels to Harrisons. For the measure of damages relevant documents of LG Electronics may include sales records, price lists, and the like, but documents of LG Electronics going to its own profits will not be relevant.
[47] The prayer for relief in Oxygen Air Ltd’s first cause of action refers to s 9 of the Contractual Remedies Act. Relief under that section is available only if a contract has been cancelled. So far, neither side has pleaded that the distribution agreement of February 2010 has been cancelled. Counsel confirmed neither side had given notice of cancellation. On the present state of the pleadings it is unnecessary to deal with documents relevant only under s 9.
[48] The traditional approach in discovery is that pleadings decide relevance.
Bray on Discovery says:11
For the purpose of testing the materiality of the discovery to a particular issue …, it is a case of the party seeking the discovery that must be assumed to be true, but not that of the party from whom the discovery is sought.
And:
Nor will the court for the purpose of determining the relevancy of the discovery to that particular issue, try that issue for the purpose of determining the relevancy of the discovery, for it is in order that that issue may be rightly determined that the discovery is required.
[49] I have not followed that approach here. When I directed this hearing, I invited the parties to address me on the account of profits issue. The modern approach is that discovery must be proportionate. It is disproportionate to require disclosure of documents for those parts of a claim which have no hope of succeeding.
[50] Accordingly, even though LG Electronics has not applied to strike out those parts of the statement of claim seeking an account of profits, I direct that inspection of documents relating to that issue alone is not required. That ensures that documents disclosing the internal margins and pricing of LG Electronics need not be disclosed. But Oxygen Air Ltd is entitled to inspect documents with information for calculating its damages claims for breach of the exclusivity terms, such as the prices LG Electronics charged for particular products subject to the alleged exclusivity provisions. That may include documents within category 27, but not 28 and 29.
[51] This ruling as to relevance requires a direction. LG Electronics is to review its discovery and give Oxygen Air a list of documents in Part 3 of the discovery affidavit that are irrelevant as a result of this ruling. Those documents are not to be made available for inspection by any agent of Oxygen Air.
Over-discovery
[52] Oxygen Air Ltd complains of over-discovery by LG Electronics. It says that the documents disclosed go beyond those that are strictly relevant to the proceeding. It refers to an affidavit by in-house counsel of LG Electronics which refers to Excel spreadsheets giving reports for the full range of it products, including audio-visual, mobile, LCD television, cooking and cleaning, washing machines and monitors. Oxygen Air Ltd points out that only some of LG’s products are in issue in this proceeding and the sales reports for other products are entirely irrelevant. It cited the Court of Appeal’s decision in BNZ Investments Ltd v Commissioner of Inland
Revenue12 as authority for the approach where one party had made excessive
discovery. The court dealt with a complaint that the Commissioner had over- discovered. Under former r 305 of the High Court Rules, the court could order costs if it considered that a party had impeded discovery and inspection by including documents not required. That rule has not been carried through into the current High Court Rules. The Court of Appeal held that the only remedy for over-discovery
other than costs was to be found in the principles of abuse of process.13 That required a reasonably high threshold for intervention.
[53] Under the current discovery rules r 8.23 says:
8.23 Incorrect affidavit of documents to be amended
If, by reason of any change of circumstances or an error or omission, an affidavit of documents filed in response to a discovery order appears to the person making discovery to be defective or erroneous, the person must promptly file and serve an affidavit that corrects or supplements the affidavit of documents.
The rule has been used to require a party making over-discovery to file and serve a fresh affidavit of documents: Edge Protection Ltd v Bank of New Zealand and NZX Ltd v Ralec Commodities Ltd.14 In both cases, the party complaining about over- discovery inspected a sample of the documents to determine the extent to which irrelevant documents had been disclosed. Oxygen Air has not taken any samples and assessed them for relevance. Its complaints are general only. Instead, it says that LG Electronics should list its documents in categories according to the particular groups in the discovery order paragraphs 3-33. It says that once that is done and once Mr
Rotteveel has been able to view the documents himself, Oxygen Air will be able to assess the extent of any over-discovery.
[54] LG Electronics says that its initial searches of documents returned over 25 gigabytes of data which was estimated to be approximately 85,000 documents. The documents were reviewed and were reduced first to some 38,000 and finally to approximately 13,480 documents, of which 3,580 are confidential. It accepts that documents it has disclosed give information about products not in issue in this case. That is because those documents also contain information that is relevant. It is not
required to black-out irrelevant parts of relevant documents.15
[55] My ruling as to relevance in paragraphs [38]-[51] above shows that documents within categories 28 and 29 of the order for discovery are irrelevant.
13 At [34].
14 Edge Protection Ltd v Bank of New Zealand [2013] NZHC 2592, NZX Ltd v Ralec Commodities
Pty Ltd [2014] NZHC 376.
15 G-Star Raw CV v Jeanwest Corporation (NZ) Ltd [2013] NZHC 1251 at [18].
That aside, Oxygen Air Ltd has not shown that any of the documents discovered by
LG Electronics are wholly irrelevant.
A re-listing order?
[56] Oxygen Air wants LG Electronics to re-do its affidavit of documents to re-list all the documents in categories 3-33 in the tailored discovery order. Oxygen Air Ltd complains that it has been given a haystack of documents and it is not able to establish whether any particular document is relevant to any pleaded issue. It rejects LG Electronics’ response that documents are “text-searchable”. This aspect is the basis for the obfuscation allegation against LG Electronics.
[57] LG Electronics points out that the tailored discovery required it to list the documents chronologically, not in any other order, and that is the default position under the High Court Rules.16 Oxygen Air Ltd agreed to the documents being listed chronologically.
[58] When the discovery orders were discussed, Oxygen Air sought more extensive discovery than LG Electronics proposed. Oxygen Air was aware that it was going to put LG Electronics to extensive work in requiring wider discovery than LG Electronics had proposed, requiring individual employees’ computers to be searched, as well as the main database, and for more extensive and wider categories of documents. It agreed to documents being listed in chronological order. Under LG Electronics discovery Oxygen Air got what it agreed to under the tailored discovery order. If it now finds that the result is inconvenient, it can only blame itself.
[59] I am not sympathetic to Oxygen Air Ltd’s complaint for the reasons given by LG Electronics. It has quite clearly been put to considerable cost to carry out discovery according to the agreed order. If I were to order the documents to be re- listed, I would make a cost-shifting order under r 8.22, but I understand that would not be acceptable to Oxygen Air. In any event, I am not satisfied that requiring the documents to be re-listed according to the categories in the tailored discovery order would be an easy exercise. There is bound to be overlap with documents potentially
falling in more than one category. There is room for disagreement as to categorising documents. As a general rule, a party making discovery of relevant documents is not required to point out to the other side how any particular documents or class of documents is relevant to any particular issue in the case. That is for the party receiving discovery to assess.
[60] In this case, the obfuscation and haystack complaints come from Mr Lockhart’s difficulties in inspecting the confidential documents given to him. Oxygen Air Ltd’s lawyers have not seen the confidential documents because they have not given confidentiality undertakings, but they have been supplied with open documents and have had the opportunity to inspect them. Oxygen Air Ltd’s lawyers do not complain that they have had any difficulty in dealing with the open documents.
[61] Given the rulings as to relevance, Mr Lockhart’s difficulties are likely to reduce. In calculating any loss of profits of Oxygen Air for sales made in breach of exclusivity terms, he will need to know the products sold, their prices and the quantities. He will inspect documents relating to those issues. Mr Rotteveel will also be able to inspect those documents.17 LG Electronics will have supplied Oxygen Air Ltd with translations of codes and other private terms. With that, it should be possible for Mr Lockhart to identify relevant documents and make his calculations.
[62] While I consider that this aspect is manageable and should not require further directions, I reserve leave to Oxygen Air Ltd to apply. If it finds that it cannot identify relevant sales records or cannot understand them notwithstanding translations provided by LG Electronics, further directions may be required. That might involve Oxygen Air Ltd specifying the date range for sales said to breach the exclusivity terms, and LG Electronics Ltd identifying documents relevant to sales in those periods. I do not order that now, because I expect Oxygen Air Ltd to deal with the matter under the directions in this decision.
Language issues
[63] Language issues arise in two respects: documents in Korean; and documents
in LG Electronics’ private language.
[64] One of Mr Lockhart’s complaints is that some of the documents he has inspected are in Mandarin. He is wrong as to the language. LG Electronics’ manufacturer is Korean, not Chinese. The standard approach is that there is no obligation on the party making discovery to provide a translation of any documents
in a foreign language.18 If Oxygen Air Ltd wishes to find out the meaning of
documents in Korean, it may use a Korean translator.
[65] The second aspect is documents in LG Electronics’ private language. Mr Lockhart says that many of the documents he has inspected have accounting codes which he does not understand. Oxygen Air Ltd cannot be expected to obtain a translator for those documents because they are in a language known only to people inside LG Electronics. LG Electronics should accordingly provide Oxygen Air Ltd with translations of any documents or parts of documents in its private language, when requested by Oxygen Air. LG Electronics does not resist this. It has already offered Oxygen Air translations of a number of its codes. My purpose is to make it clear that it is required to as a matter of obligation. This is a direction under r 8.29.
Disclosure to Mr Rotteveel
[66] LG Electronics objects to Mr Rotteveel seeing any of the confidential documents because it sees him as a competitor. Oxygen Air has stopped ordering products from LG Electronics. Mr Rotteveel has had the name of his company changed to “LG Air Ltd”.19 Mr Rotteveel has another company, Oxygen NZ Ltd, which is the authorised distributor of Fujitsu air-conditioning products and also distributes Panasonic, Carrier and Aspen air-conditioners and heat-pumps. These
products are all sold in the same market as those of LG Electronics. LG Electronics
18 Amaltal Corporation v Maruha Corporation (2003) 16 PRNZ 968 (HC), following Bayer AG v
Harris Pharmaceuticals Ltd [1991] FSR 170, and Jasper Millwork Ltd v Borden Co [1997] 3
WWR 653, 4 CPC (4th) 303.
19 I continue calling it “Oxygen Air Ltd” to avoid confusion.
is concerned that any of its confidential information that comes into the hands of Mr Rotteveel is in danger of being leaked to its competitors. It also points out that it holds confidential information of its distributors and that information may be valuable to Oxygen NZ Ltd. It is not reassured by any express undertaking that Mr Rotteveel might give.
[67] Against that, Oxygen Air says that Mr Lockhart needs Mr Rotteveel’s input to understand documents disclosed by LG Electronics. LG Electronics’ concern does not apply to solar panels because Mr Rotteveel and his associated companies do not deal in solar panels.
[68] For Oxygen Air there are strong reasons for Mr Rotteveel to have access to all the documents disclosed by LG Electronics. That is not just for the reason that Mr Lockhart believes that Mr Rotteveel could help him understand the documents disclosed by LG Electronics. More than that, as director of Oxygen Air, Mr Rotteveel needs to give its lawyers instructions and receive advice from them about the proceeding. Its lawyers need to tell him about documents disclosed on discovery. Their advice will be more effective if they are able to tell him about documents disclosed on inspection. Further, Mr Rotteveel will give evidence and for that purpose it is important that he see LG Electronics’ documents himself. His inspection of LG Electronics’ documents will enable him to instruct Oxygen Air’s lawyers about the proceeding. In short, Oxygen Air’s ability to bring its claim will be impeded if he does not have access to all documents discovered by LG Electronics which are not subject to privilege.
[69] Given that, it is necessary to assess the risk to LG Electronics’ legitimate concern that disclosure to Mr Rotteveel creates an unacceptable risk that the information in those documents may be misused. The matter of greatest concern to LG Electronics, the highly confidential documents relating to margins and profitability, has already been addressed. They will not be available for inspection by anyone associated with Oxygen Air because they documents are not relevant for this proceeding. LG Electronics will still be required to disclose documents showing sale prices for products subject to alleged exclusivity terms and quantities of those products sold. So far as air-conditioning and heating products are concerned, there
can be no prejudice to LG Electronics in Mr Rotteveel receiving that information, because he is likely to know the sales prices through Oxygen Air’s distributorship with LG Electronics. It is hard to see that there will be any risk to LG Electronics if Oxygen Air finds out (if it does not know already) the identity of others LG Electronics dealt with in breach of any exclusivity terms.
[70] There are similar considerations for documents relating to the solar panel causes of action. Oxygen Air Ltd does not deal in solar panels. Both sides acknowledge that there were negotiations about Oxygen Air obtaining a distributorship for solar panels (even though LG Electronics denies that the parties did reach agreement). Oxygen Air Ltd is likely to know already the prices LG Electronics would charge it for solar panels. There is little prospect of any harm coming to LG Electronics, if Mr Rotteveel finds out the prices LG Electronics sells its solar panels to Harrisons.
[71] The point here is that LG Electronics is not required to make available highly confidential information relating to its own profits and margins, but is required to divulge less sensitive information – the prices it charges its customers and quantities sold to customers.
[72] While the greater part of the documents for which LG Electronics claims confidentiality relate to aspects of quantum, counsel for LG Electronics advised that some of the confidential documents relate to liability, especially documents relating to long-term inventories. In its first cause of action, Oxygen Air Ltd pleads that LG Electronics had stock shortages which prevented it fulfilling orders to its re-sellers. In denying that allegation, LG Electronics’ statement of defence refers to forecast purchase orders and stock levels. Amongst other things, it pleads that in January
2015 Mr Rotteveel agreed to take all stock that was long-term inventory and would take further delivery each month before it became long-term inventory. Given Mr Rotteveel’s dealings with LG Electronics on these matters, it is important for Oxygen Air Ltd’s case that Mr Rotteveel has access to these documents himself, both for giving evidence himself and also for taking advice and giving instructions for the proceeding.
[73] LG Electronics did not identify any other class of documents for which it claimed confidentiality but for which it stood to be prejudiced if Mr Rotteveel could inspect them. In summary then, I am satisfied that so long as the highly confidential documents relating to profits margins and LG Electronics’ own profitability are excluded from inspection, there is little risk to LG Electronics if Mr Rotteveel were to give an express undertaking as to confidentiality, and he were to have access to all documents within Part 3 that relate to liability and those documents relating to quantum to which Oxygen Air Ltd’s lawyers and accountant also have similar access. I expect Mr Rotteveel to have general knowledge of that information already. While he no longer deals with LG Electronics and deals in competing brands of air-conditioning and heat-pumps, there is no suggestion that he has misused any information acquired from when he was dealing actively with LG Electronics. Accordingly, I see no reason to impose any greater restrictions on Mr Rotteveel’s access to the documents than for the lawyers for Oxygen Air Ltd and Mr Lockhart.
Conclusion
[74] Because Oxygen Air Ltd’s claim for an account for profits is misconceived, LG Electronics does not need to make available for inspection documents relating to its profits and margins – that is, documents within categories 28 and 29. Those documents are highly confidential. The prospect of information in those documents being misused led LG Electronics to impose restrictions against Mr Rotteveel seeing those documents. As those documents are not relevant, directions for inspection are more straightforward. There is little, if any, risk of Mr Rotteveel misusing information obtained from inspecting other documents within Part 3 of LG Electronics’ affidavit of documents. For the reasons given in paragraphs [66]-[73] it is important for Oxygen Air Ltd’s case that he be able to inspect those documents within Part 3 (barring those that have been ruled irrelevant).
[75] LG Electronics is required to provide Oxygen Air Ltd with translations of any documents in its private language, including details of product codes. It is not required to translate any documents in Korean. Oxygen Air Ltd has not shown that LG Electronics has over-discovered. LG Electronics Ltd is not required to re-list its
documents, but if there are further difficulties in inspecting the documents, leave will be reserved to come back.
[76] I do not give directions to address Mr Lockhart’s difficulties in opening files and locating documents. Those are practical matters which the parties should be able to manage themselves. The court is not required to micro-manage inspection of documents.
[77] I reserve costs, notwithstanding r 14.8. The parties have had mixed success. Neither can claim to be a clear winner. Oxygen Air has overcome the resistance to Mr Rotteveel inspecting confidential documents. At the same time, it has failed on a significant issue – its claim for an account of profits.
[78] I make these orders:
(a) Documents within categories 28 and 29 of the tailored discovery order which relate only to Oxygen Air Ltd’s claims for an accounting of profits are not to be inspected. By 29 August 2017 LG Electronics is to give notice to Oxygen Air Ltd identifying those documents barred from inspection.
(b)Subject to (a), documents in Part 3 of LG Electronics’ affidavit of documents may be inspected by Oxygen Air’s lawyers and any expert witness for Oxygen Air, upon their giving an undertaking under paragraph [20] above.
(c) Upon Mr Rotteveel giving an undertaking under paragraph [20] above, he may inspect documents within Part 3 of the affidavit of documents except those barred from inspection.
(d)LG Electronics Ltd is to give Oxygen Air Ltd translations of documents in its private language, including product codings, within five working days of request by Oxygen Air Ltd.
(e) Leave is reserved to apply for further directions as to inspection of documents.
(f) Inspection of documents is to be completed by 15 September 2017.
(g) There is to be a face-to-face conference on 22 November 2017 at
9:00 am. If there are no interlocutory applications filed before that date, directions will be given for trial. Oxygen Air Ltd will be expected to have filed and served an amended statement of claim showing the quantum of the financial relief sought.
(h)If any interlocutory applications are filed in the meantime, the Registrar is to allocate a telephone conference for directions to be given.
(i) Costs are reserved.
……………………………………..
Associate Judge R M Bell
6
5
1