Things To Think About

First: the place of the principle of extended joint criminal enterprise liability in Australia and secondary criminal liability/ complicity more broadly.  I noted last fortnight that Alan Fels has called for greater accessorial liability of franchisors for the misbehaviour of franchisees.  That was in the context of civil law, but necessarily begs the question whether the common law (or statutory law, depending on your jurisdiction) criminal principles of complicity are serving the community well, in the context of corporate crime.   This fortnight, the High Court has considered the principle of extended joint criminal enterprise liability, which (depending on your point of view) is either another type of secondary liability, or a subcategory of accessorial liability: see  Miller v The Queen [2016] HCA 30 .  Although this principle is almost always invoked in homicide prosecutions, it may also be relevant to corporate crimes committed by a group of companies and/or individuals. (Indeed, the possibility of convicting corporations for homicide offences, including genocide, on the basis of joint criminal enterprise is explored in a recent work: Michael Kelly, Prosecuting Corporations For Genocide (Oxford University Press, 2016))   Close attention ought to be paid to the commentary at [38] and following; mere words (“I don’t agree to the use of X”) are insufficient to exculpate a member from foreseen but unintended and unagreed consequences of agreed criminal activity.

Second: the failure of competition to reduce drug prices, post-patent expiry. “[T]he price of an increasing number of generic drugs with multiple manufacturers is rising [in the United States].  For example, eight of the 10 drugs that had the biggest percentage price hikes in 2014 were generic medicines made by multiple manufacturers, according to information published by the [US] federal Medicare program.” Why is this a US problem? “Unlike nearly every other developed nation, the U.S. allows drug manufacturers to set their own prices…” See also: How the maker of the Epipen made government its ally.

Third: the apparent failure of Australian insurance companies to administer the WorkSafe insurance scheme in good faith. (I didn’t realise this work was outsourced in the first place.)  A Fairfax investigation suggests that the problems revealed in Adele Ferguson’s Four Corners investigation into CommInsure may be rife within the Australian insurance industry generally, suggesting that insurers acting for WorkSafe are improperly rejecting claims.

Law & Policy Updates

The ACCC has published an excellent guide to its use of s155 compulsory examination and evidence gathering power under the Australian Consumer Law.

Notable Litigation Actions

Australia

The ACCC has initiated civil pecuniary penalty proceedings in the Federal Court against “German company Volkswagen Aktiengesellschaft (VWAG) and its Australian subsidiary, Volkswagen Group Australia Pty Ltd (VGA) (together, Volkswagen), alleging they engaged in misleading or deceptive conduct, made false or misleading representations and engaged in conduct liable to mislead the public in relation to diesel vehicle emission claims.”

The prosecution of Mr Choiselat, former director of Q Ltd and Jumbuck Entertainment Ltd for alleged share warehousing and market manipulation, has come to a close this fortnight, upon a County Court jury’s finding that he is unfit to stand trial.  Precious little is revealed in ASIC’s press release, but the ultimate orders must have been made under s20BC(5) Crimes Act 1914.  If you’re wondering why the conditions of his release are so short, that’s because the Act limits any conditions to 3 years maximum.

A reminder to corporate crime prosecutors that, just because you are prosecuting ‘regulatory’ offences, likely in a summary court, you may not assume the ordinary rules of criminal procedure do not strictly apply.  Rather startlingly, the council prosecuting Geitonia Pty Ltd v Inner West Council; Gertos v Inner West Council [2016] NSWCCA 186 refused to call a(n obviously) material witness despite repeated requests from the accuseds to do so: after convictions in the NSW Land and Environment Court, the offenders appealed to the NSW SCA; all three Justices found that the witness should have been called.  However, only one Justice considered that the failure occasioned a miscarriage of justice, so the appeals failed.  Just how do you assess whether the failure to call a material witness occasions a miscarriage of justice?  Well, each of the three judges took a different approach.  Cases like these serve to remind practitioners who move between civil and criminal jurisdictions that there are very different rules (and values) that apply in each.

For those of you interested in jury trials, this has turned out to be quite an extraordinary year for High Court commentary.  We’ve already watched the Smith v WA case resolve this year with a confirmation of the original jury verdict, following judicial enquiry into the jurors’ deliberations; now, we have The Queen v Baden-Clay [2016] HCA 35 and NH v DPP [2016] HCA 33  in which the High Court has restored original jury verdicts unsettled by courts of appeal.  NH in particular, warrants a close read after Smith; whereas in Smith the High Court was satisfied there were grounds for inquiry into the jury’s deliberations, in NH, the High Court determined there was no basis on which a court could properly receive the affidavits taken from jurors post-verdict.

UK

An important civil damages claim was lodged this fortnight: a £14 billion class action, initiated under the UK’s new Consumer Rights Act 2015 on behalf of all UK consumers.  Class representative Walter Merricks CBE is a former Chief Financial Services Ombudsman.  The defendant is MasterCard; the claim, handled by Quinn Emmanuel, alleges that MasterCard unlawfully levied card charges on businesses, and these unlawful charges  were passed along to consumers.  It’s notable, not for its size (though it is the largest UK damages claim to date) but because it will test the new Act under which it is brought (how, for example, will damages be calculated? Distributed?) and provide a model for similar consumer actions. More generally, cases like these ask us to consider the proper role of individual litigation, class action litigation, and competitor litigation in the enforcement of commercial good behaviour.

Event Calendar

The ACCC is seeking feedback on its guidance concerning the Competition and Consumer Amendment (Competition Policy Review) Bill. “In particular, the ACCC is inviting feedback from consumers, businesses, and other stakeholders about the issues and topics the ACCC can provide guidance on to assist them understand how the amended misuse of market power prohibition, and the prohibition on anti-competitive concerted practices are likely to operate and how we’ll approach those provisions,” Mr Sims said.”  Comments due 3 October 2016.

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