High Court: Former INM directors permitted to use affidavits in proceedings against INM
Two former Independent News and Media directors who are pursuing litigation against the company have been granted an order permitting them to use affidavit evidence which had been furnished to them in relation to proceedings between INM and the Director of Corporate Enforcement. Finding, inter alia, that this would not confer a litigation advantage on the applicants, Mr Justice Peter Kelly, President of the High Court said that if the order was not made, discovery applications were inevitable, which would be wasteful of scarce time and resources of the court.
In 2018 the Director of Corporate Enforcement was granted an order by the court pursuant to the provisions of s.748 of the Companies Act 2014 appointing inspectors to investigate and report on the affairs of Independent News and Media plc (INM). In September 2018, Mr Justice Kelly appointed two inspectors to investigate INM in respect of four different matters.
The present application involved one of those matters – the “data interrogation issue”, which involved removal of computer data from INM’s premises and interrogated outside the jurisdiction.
During the course of the interrogation, data appears to have been searched against the names of 19 individuals – including the first applicant, Karl Brophy, who was employed as INM’s Director of Corporate Affairs between January 2011 and October 2012.
The second applicant in the present application, Gavin O’Reilly, was the CEO of INM between 2009 and April 2012. He was not named among the 19 individuals, but his personal assistant’s name did appear, and he submitted that it was clear from the material disclosed that he was “personally targeted by the data interrogation”.
The publicity surrounding the Director’s proceedings against INM led to interested parties seeking copies of the affidavits placed before the court. In April 2018, Mr Brophy and Mr O’Reilly were furnished with the grounding affidavit of the Director, and twelve replying affidavits which had been filed up to that point.
One restriction placed upon the recipients was that they were precluded from using the documentation for any purpose other than in these proceedings – and that they must apply to court for leave to use the material for any other purpose.
As such, in the present application, Mr Brophy and Mr O’Reilly sought permission to use the documents already furnished to them in these proceedings for the purpose of pursuing litigation against INM and possibly other persons for inter alia breach of privacy and breach of data protection rights.
The Director had no objection to the order being granted but INM objected.
Making the order not an injustice to INM
INM’s first objection was that the relief sought was unduly wide, however Mr Justice Kelly said it was clear that the material was sought to be used in the context of proceedings which were contemplated arising from the data breach. Mr Justice Kelly said he was unable to agree with as the Applicants “identified the particular purpose for which they wish to use the relevant material, namely, the prosecution of claims arising out of the alleged wrongdoing”.
Another argument on behalf of INM was that to make an order of the type sought would amount to a breach of s.790 and s.791 of the Companies Act 2014 – however Mr Justice Kelly said neither of those provisions had any relevance to the present application. Firstly, the material was furnished with the consent of INM and secondly, the giving of the information was not a unilateral action on the part of the Director.
Mr Justice Kelly also rejected INM’s contention that the Applicants failed to sufficiently identify any disadvantage to them should they be denied the relief sought. He said, “[a]t a very minimum they will be obliged to seek discovery of the very material that they already have… From a public interest point of view that would be wasteful of the scarce time and resources of the court as well as increasing the costs and delaying the litigation in question”.
Rejecting the contention that granting the order sought would confer an improper litigation advantage on the part of the applicants, Mr Justice Kelly made an order permitting Mr Brophy and Mr O’Reilly “to use the documents furnished to them pursuant to the order of this court of 24th April, 2018 for the purpose of bringing proceedings against INM and other persons, if thought appropriate, for breach of privacy, breach of data protection rights, and breach of constitutional rights”.
- by Seosamh Gráinséir for Irish Legal News
© Irish Legal News Ltd 2020