re: amcor litigation worries
seem to have a fair bit of skeletons in the closet, but not sure how big of a problem it will all be
article;
"VISY Industries has launched a new legal battle against arch-rival Amcor with explosive allegations that the paper and packaging group, via a former Visy employee, unlawfully obtained confidential information about Visy's operations.
The new case, initiated yesterday in the Federal Court, alleges that former Visy manager John Morriss, who became a senior Amcor manager in 1998, relayed information about Visy's business, customers, pricing, sales, costs and contracts to senior executives at Amcor from 1997 until he quit Amcor in January 2000.
Visy alleges the information was used in 1998 by senior Amcor executives in the corrugated fibre packaging business, including Peter Brown and Jim Hodgson, and that four years later Mr Hodgson relied on it when he lobbied Amcor's board to restructure the cardboard box division, close factories and retrench staff.
This is the latest in an increasingly complex series of cases that have entangled Australia's two biggest packaging groups since 2004, when Amcor told the Australian Competition and Consumer Commission that for four years it apparently had participated in a price-fixing cartel with Visy.
On one front, the ACCC is suing Visy, its founder Richard Pratt and two other Visy managers for price fixing, although the case is not likely to begin until next year. Visy denies that it participated in a cartel, and claims that whatever actions or words it relayed to Amcor managers during that four years, and that have been interpreted as participation in a cartel, were merely a ploy to throw Amcor off its trail.
Revelations of the cartel activity emerged in 2004 when Amcor obtained court orders to raid the premises of five former employees — Mr Hodgson, Trevor Barnes, Christopher Bayley, Albert Mihelic and Ian Sangster — who planned to set up their own consultancy to the packaging industry.
Amcor's lawyers seized many documents during the raids, and
unexpectedly discovered recordings of conversations that apparently incriminated the company in deals where Amcor and Visy co-operated on fixing prices and agreed not to compete for certain customers.
Amcor sacked several executives at the time, including then chief executive Russell Jones, Peter Jones and consultant Peter Sutton.
Visy's new claim alleges that Mr Morriss, who was in charge of Visy's Victorian operations from 1989 until he resigned in January 1996, breached his fiduciary duties to Visy by leaking information to Mr Brown before he secured a new job at Amcor in January 1998.
Visy claims that senior Amcor executives used the secret information in presentations to former Amcor CEO Mr Jones and the Amcor board.
Mr Morriss said last night he did not know anything about Visy's claims and had not seen the writ.
Visy's writ alleges that on September 8 it asked Amcor to confirm or deny that it had obtained confidential Visy information from Mr Morriss and to hand it over. It says that six days later Amcor replied, saying it did not accept Visy's allegations.
A spokesman for Amcor last night said the company had not yet been served with the writ.
Separately, Mr Hodgson, who was nudged out of Amcor in August 2004, is suing Amcor for wrongful dismissal. He recently filed documents suggesting it was Amcor, not Visy, that initiated the cartel.
On yet another front, Amcor is facing a damages claim related to its cartel behaviour. Jarra Creek Packaging yesterday obtained permission from a Federal Court judge to access certain affidavits, exhibits and closed-court transcripts that emerged in Amcor's original bid of two years ago when it stopped the five former managers from using what it said was confidential information about Amcor's pricing structures and customer contracts.
As well, revelations emerged this week that Amcor secretly commissioned a team of employees to infiltrate environmental groups in its bid to influence government decisions about forestry access and help it secure long-term hardwood supplies.
AMC Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
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