Norcast S.ár.L v Bradken Limited (No 2)

Judgment

Both the bid-rigging and misleading conduct claims were made out. On the bid-rigging claim:

Was there a request for bids?

The 'purpose condition' relevant to bid rigging is contained in section 44ZZRD(3)(c) of the CCA and it makes reference to a 'request for bids'. Justice Gordon found that there was such a request (reasons from para 213).

Meaning of request for bids

Norcast alleged that the request for bids in this case was the sale process for NWS established by UBS together with the sales material prepared by UBS and provided to potential buyers (para 214). Bradken, on the other hand, submitted there was no request for bids, that it believed it had been excluded from the sale and that there was 'no request for bids in Australia nor any request for bids in relation to the supply or acquisition of goods or services in Australia' (para 215)

On the broad issue of whether there was a request for bids Bradken had submitted that to constitute such a request it must be 'directed to the parties to the alleged contract, arrangement or understanding' (para 216). and that it those persons 'must be persons who are able to bid in response to that request' (para 218). Justice Gordon rejected these submissions. Her Honour noted isolating words for interpretation was of limited utility as 'it is the whole phrase that is to be construed in the context of the CCA and in a manner consistent with the policy and purpose of the legislation' (para 219).

As a matter of statutory construction her Honour concluded there was:

[para 220] nothing in the language of the section that requires a request directly or individually to each of the parties to the alleged contract, arrangement or understanding.  Such a construction is not supported by the statutory language.  The section does not stipulate to whom any request need be made.  Why?  Because it refers to a singular “event of a request for bids”, not requests for bids. 

Further:

[para 221] ... that construction of the section is consistent with the purpose of the provision which is to prohibit per se bid rigging between competitors, including potential competitors.  Again, there is nothing in the language of the section (or the EM) to suggest that the bid rigging prohibition is somehow restricted to only those bidders or potential bidders who were within the scope of that process:  see EM at [1.2] and [1.39]-[1.42].  Put another way, if Bradken’s construction of the section was the preferable construction, it would frustrate the statutory purpose because the prohibition would be inapplicable to arrangements involving a person who had not been individually invited or requested to bid in circumstances where that person may nevertheless have made a bid (but for the arrangement sought to be impugned).  Such an arrangement would still be bid rigging and no less objectionable on competition grounds.

In this case there was a competitive sale process for NSW conducted by UBS and this constituted 'the event of a request for bids' within the meaning of section 44ZZRD(3)(c) of the CCA (para 223).

Her Honour further observed that, even if Bradken's construction was preferred, it would not assist because there was a 'request for bids' directed to both Bradken and Castle Harlan; this is because section 44ZZRD(3)(c) requires only a 'request for bids' and not 'an individual invitation to join in any request for bids' (para 224).

Territorial coverage of s 44ZZRD

Her Honour also rejected Bradken's claim that any relevant 'request for bids' must be 'a request for bids' in Australia (page 226). Her Honour noted that there was nothing in the language of the provision to support that contention:

[para 228] If the legislative intent had been to impose a territorial limitation in relation to the “request for bids” condition in s 44ZZRD(3)(c), then words to that effect would have been included in the provision expressly or by reference:  cf the definition of “trade or commerce” in s 4 and the definition of “market” in s 50A.

Her Honour noted that, while s 45 contains a territorial limitation (because s 45(3) defines competition for purposes of that provisions as meaning '.... competition in any market in which ...' and 'market' is defined in s 4E as 'a market in Australia'), no such territorial limitation can be found in s 44ZZRD(3)(c) and none should be implied.

The territorial coverage of s 44ZZRD(3)(c) is, therefore, governed by s 5 of the CCA.

[para 231] [Section 5] is a conduct nexus requirement.  It provides that the CCA may extend to conduct occurring outside Australia provided there is a connection between the corporations or persons engaging in the conduct and Australia.  For corporations, the requirement is that the corporation be incorporated in Australia or carry on business in Australia.  In the present case and to the extent necessary, Bradken would satisfy both limbs.  It is incorporated in Australia and carries on business in Australia.  The nexus between Castle Harlan and Australia is considered at [242]-[256] below.  Second, where damages under s 82 of the CCA or s 236 of the ACL are sought, s 5(3) provides that conduct occurring outside of Australia and otherwise within the scope of s 5(1) may not be relied upon except with the consent in writing of the relevant Minister.  The Minister is required to give consent under s 5(3) unless, in the opinion of the Minister, the law of the country in which the conduct occurred required or specifically authorised the conduct and it is not in the national interest for consent to be given.  Norcast sought the Minister’s consent prior to the hearing of the proceeding.  ...  It was not necessary for the Minister’s consent to have been obtained prior to the commencement of the hearing.  However, it was necessary for the outcome of Norcast’s request for consent to be known prior to the delivery of judgment.  The Minister ultimately provided consent on 14 March 2013. 

Justice Gordon also rejected Bradken's claim that the provision requires that the request for bids be 'in relation to the supply or acquisition of goods or services' in Australia (para 232), noting that there is no such limitation in the provision.

Castle Harlan carrying on business in Australia

Norcast alleged that each of the respondents were involved in contraventions by Castle Harlan.

[para 242] ... The primary claim was that Castle Harlan contravened ss 44ZZRJ and 44ZZRK of the CCA and s 18 of the ACL.  A claim for accessorial liability must fail if the primary claim is not maintainable:  Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at [154].

Castle Harlan is a NY based private equity fund. To succeed, Norcast needed to establish Castle Harlan carried on business within Australia (s 5(1)(g)). On the definition of carrying on business her Honour observed:

[para 254] Carrying on business in Australia is not defined in the Corporations Act 2001 (Cth) ... It is amplified in s 21 of the Corporations Act and includes having a "place of business" in Australia and administering, managing or otherwise dealing with property situated in Australia as an agent, legal personal representative or trustee, whether by employees or agents or otherwise.  That definition is itself not exhaustive.  There remains scope for the operation and application of territorially-based concepts of carrying on business derived from the general law:  Re Application of Campbell; Gebo Investments (Labuan) Ltd v Signatory Investments Pty Ltd (2005) 54 ACSR 111 at [36]. 

[para 255] At general law, carrying on a business generally involves conducting some form of commercial enterprise, systematically and regularly with a view to profit:  Gebo Investments at [38].  ... a company may be found to carry on business in Australia even though the bulk of its activities are conducted elsewhere (Gebo Investments at [38]-[41]) and that it conducts its activities in Australia by reason of its control over or connection with an Australian company:  Adams v Cape Industries Plc [1990] Ch 433 at 530 and Bray v F Hoffman-La Roche Ltd (2002) 118 FCR 1 at [60]-[63]. 

Justice Gordon set out in detail Castle Harlan's business links in Australia, including through its interest in CHAMP (see para's 243-249, 251-253) and activity relating to the NSW acquisition which took place in Australia (para 250). These were summarised in para 256 where her Honour concluded that Castle Harlan did carry on business within Australia:

[para 256] Castle Harlan was a co joint venturer in CHAMP, an Australian company.  It (with CHAMP) raised over a billion dollars of Australian investment funds by way of multiple raisings over a period of years.  It (with CHAMP) acquired and then sold for profit at least two Australian companies - Austar and UMH.  Monthly Executive Committee meetings of CHAMP were held in Sydney.  Indeed, Morgan moved to Sydney to establish CHAMP.  Castle Harlan’s activities in Australia were not isolated but were repetitive and with a view to profit.  Greiner’s oral evidence about Castle Harlan’s role in CHAMP (that it was advisory in nature) is rejected.  It was inconsistent with the contemporaneous documentary record:  see [244]-[249] and [251]-[253] above.  Those facts establish that Castle Harlan carried on business within Australia itself and, further or alternatively, through CHAMP.

Ministerial consent

On the issue of ministerial consent for the damages claim see below.

Are shares goods or services?

However, the provision does refer to 'goods or services' and the Court requested submissions on what constituted the relevant 'supply or acquisition of goods or services'. It was clear that the acquisition did not relate to goods. Norcast alleged (and on this point Bradken agreed) that supply of shares in NWS constituted 'services' pursuant to the definition of services in section 4. This definition includes reference to 'rights' including 'in relation to, and interests in, real or personal property' and 'benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce'. Justice Gordon accepted that, although it is 'unusual to refer to shares ... as 'services'', it was clear that, at the very least, a 'share is a right and is a chose in action' and therefore a service pursuant to the s 4 definition'. (para's 238-240)

Her Honour concluded that the purpose condition was capable of being satisfied in this case and that there was, therefore, a 'cartel provision'.

Competition Condition: Were Bradken and Castle Harlan in competition (or likely to be) in relation to the acquisition of NSW

Norcast was required to establish, under s 44ZZRD(4), that 'but for the Bid Rigging Arrangement, Bradken and Castle Harlan would have been, or would have been likely to be, in competition with each other in relation to the acquisition of the relevant services, the shares in NWS' (para 257).

Bradken submitted this was not satisfied both because neither Bradken nor Castle Harlan were included in the NWS sale process and that, even if they 'would have been likely to be in competition with each other in relation to the acquisition of the shares in NWS, the competition condition referred to in s 44ZZRD(4) requires, as a matter of statutory construction, that competition must be in respect of a market in Australia' (para 258). Justice Gordon rejected both contentions (at 258).

In competition with each other

[para 259] The likelihood of parties being in competition with each other is a question of fact:  J McPhee & Son (Australia) Pty Ltd v Australian Competition and Consumer Commission (2000) 172 ALR 532 and Australian Competition and Consumer Commission v Pauls Ltd (2003) ATPR 41-911. ...   "likely" includes "a possibility that is not remote":  s 44ZZRB'

Her Honour noted that Castle Harlan bid for NWS and Bradken wanted to acquire NWS and, absent their arrangement 'it is at least possible that Castle Harlan and Bradken would have competed with each other in bidding for NWS' (para 260).

Competition in respect of a market in Australia?

Her Honour rejected Bradken's claim that s 44ZZRD(4) required competition to be 'in respect of a market in Australia', noting that there was no such limitation in the provision and none should be implied (para 261). Her Honour noted that, had the legislature intended such a territorial limitation it would have included words to that effect, concluding, a 'territorial limitation of the kind contended for by Bradken is unnecessary and inappropriate' (para 261).

Was there a contract, arrangement or understanding?

In determining the facts, Justice Gordon noted that the 'form and content of the various communications are consistent only with an arrangement whereby Castle Harlan would bid, and Bradken would not bid, for NWS' (para 104). Her Honour referred to this as the Bidding Provision.

[para 262] The Bidding Provision was a cartel provision.  It is then necessary to deal with Norcast’s contention that Bradken and Castle Harlan made a contract or arrangement, or arrived at an understanding, in relation to bidding for NWS (the Bid Rigging Arrangement), which contained the Bidding Provision.  Bradken submitted that, at no time prior to 17 June 2011, had the parties committed to an on-sale of NWS by Castle Harlan to Bradken.

Her Honour then usefully summarised the legal principles in relation to establishing a contract, arrangement or understanding.

[para 263]: 1. an arrangement or understanding is apt to describe something less than a binding contract or agreement:  Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 at [75]; see also Newton v Federal Commissioner of Taxation (1958) 98 CLR 1 (Privy Council) cited with approval in Top Performance Motors Pty Ltd v Ira Berk (Queensland) Pty Ltd (1975) 5 ALR 465 at 469;

2. the elements of an arrangement or understanding are:

2.1 evidence of a consensus or meeting of the minds of the parties, under which one party or both of them must assume an obligation or give an assurance or undertaking that it will act in a certain way which may not be enforceable at law:  Australian Competition and Consumer Commission v Construction, Forestry, Mining and Energy Union [2008] FCA 678 at [10] and the authorities cited;

2.2 a hope or mere expectation that as a matter of fact a party will act in a certain way is not itself sufficient to establish an arrangement or understanding, even if it has been engendered by that party:  ACCC v CFMEU at [10] and the authorities cited including Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission (2005) 159 FCR 452 at [45] and Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at [79];

2.3 the necessary consensus or meeting of minds need not involve, though it commonly will in fact embody, a reciprocity of obligations:  ACCC v CFMEU at [10] and the authorities cited;

2.4 in relation to whether or not mutual obligation is a necessary ingredient of an arrangement or understanding, it has been suggested that it is difficult to envisage circumstances that would be an understanding within s 45 of the TPA involving the commitment by one party without some reciprocal obligation by the other party:  Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-1 and 238.  That statement applies equally to ss 44ZZRJ and 44ZZRK of the CCA;

2.5 an arrangement may be informal as well as unenforceable with the parties free to withdraw from it or to act inconsistently with it, notwithstanding their adoption of it:  Federal Commissioner of Taxation v Lutovi Investments Pty Ltd (1978) 140 CLR 434 at 444;

3. whether there is a difference between an arrangement and an understanding has not been resolved:  Trade Practices Commission v TNT Management Pty Ltd (1985) 6 FCR 1 at 22-6 but cf Australian Competition and Consumer Commission v Australian Medical Association Western Australia Branch Inc (2003) 199 ALR 423 at 460.  However, the concept of an understanding is broad and flexible:  cf L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd (1978) 34 FLR 81 at 89 and Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (2004) 141 FCR 183 at [54];

4. whether or not an arrangement or understanding has been reached will depend on the view formed of all of the circumstances.  A meeting of minds may be proved by independent facts and from inferences drawn from primary facts including, without limitation, evidence of joint action by the parties in relation to relevant matters, evidence of parallel conduct and evidence of collusion between the parties.  As Isaacs J said in R v Associated Northern Collieries (1911) 14 CLR 387 at 400:

Community of purpose may be proved by independent facts, but it need not be.  If the other defendant is shown to be committing other acts, tending to the same end, then though primarily each set of acts is attributable to the person whose acts they are, and to him alone, there may be such a concurrence of time, character, direction and result as naturally to lead to the inference that these separate acts were the outcome of pre-concert, or some mutual contemporaneous engagement, or that they were themselves the manifestations of mutual consent to carry out a common purpose, thus forming as well as evidencing a combination to effect the one object towards which the separate acts are found to converge. 

See also News Limited v Australian Rugby Football League Limited (1996) 64 FCR 410 at 573-4. 

[para 254] However, where proof of an arrangement or understanding rests on inferences to be drawn from primary facts, it is not sufficient for the circumstances to give rise to conflicting inferences of equal degrees of probability:  Luxton v Vines (1952) 85 CLR 352 at 359-60.

[para 265] In the present case, the evidence establishes that Castle Harlan and Bradken entered into the Bid Rigging Arrangement no later than 8 March 2011.  The Bid Rigging Arrangement was informal and unenforceable.  Either party could withdraw from it or even act inconsistently with it.  Hodges himself contemplated doing so in mid-June of 2011:  see [188] above.  But that does not detract from the finding that the Bid Rigging Arrangement:

1.         was entered into by Castle Harlan and Bradken; and
2.         was given effect to by Castle Harlan and Bradken.

[para 266] The finding that Castle Harlan and Bradken entered into the Bid Rigging Arrangement no later than 8 March 2011 is founded on direct and express communications between the parties to the arrangement, namely Castle Harlan and Bradken ...

[para 267] Even if, contrary to the view formed, those direct and express communications were insufficient to found a finding that Castle Harlan and Bradken entered into the Bid Rigging Arrangement no later than 8 March 2011, that finding is open having regard to the inferences to be drawn from the circumstances that existed:  cf News Limited v Australian Rugby Football League Limited at 573-4 citing R v Associated Northern Collieries at 400. [Her Honour then set out those circumstances in detail at para 268]

[para 269] The existence of the Bid Rigging Arrangement did not depend upon the parties having reached a concluded agreement regarding the on-sale of NWS to Bradken.  Further, each of the matters listed in [268] above is evidence not only of the existence of the Bid Rigging Arrangement, but to the extent that those matters occurred after 8 March 2011, is evidence of Bradken and Castle Harlan giving effect to the Bid Rigging Arrangement.

Purpose condition: 'Did the Bid Rigging Arrangement contain a provision which had the purpose of directly or indirectly ensuring that in the event of a request for bids in relation to supply or acquisition of goods or services, one party would bid but the other would not'?

Bradken submitted that there were two reasons why the purpose condition was not established - both were rejected.

• First, Bradken submitted the purpose condition 'required that the Court must find that the operative, subjective purpose of the parties to the Bid Rigging Arrangement was to ensure that, in the event of a request for bids, one party bid but the other did not' (para 271) and that neither Bradken nor Castle Harlan had this subjective purpose. This was because Hodges and Greiner believed Bradken had been excluded from the bidding process.

  • Her Honour accepted that the purpose condition 'directs the Court to consider the subjective, operative purpose of the parties to the relevant arrangement', but also that this purpose 'may be inferred ... from the nature of the arrangement, the circumstances in which it was made and its likely effect' (para 273) and that the purpose is the 'end sought to be accomplished by the conduct' (para 275).

  • Here, her Honour held, the 'operative purposes to be considered were those of Hodges, Greiner, Harlan and Morgan, which could be imputed to their respective corporate principles' (para 274). Her Honour rejected the contention that 'Hodges and Greiner did not have a purpose of ensuring that Bradken would not bid, but instead Castle Harlan would bid, for NWS' (para 275), noting that the belief that Bradken had been excluded from the sale process was not inconsistent with that purpose (para 275). Her Honour noted: 'It is ... inconceivable that Castle Harlan would have agreed to enter the NWS sale process, at Bradken’s suggestion and with Bradken’s assistance, in circumstances where Bradken still reserved the right to itself bid for NWS'.

• Second, Bradken submitted that the 'requirement of "ensuring that … one or more parties to the contract, arrangement or understanding bid, but one or more other parties do not" (emphasis added) could not be satisfied unless there was a degree of reciprocity to the Bid Rigging Arrangement.' (para 271)

  • Her Honour noted that it was difficult to envisage circumstances in which there would be an agreement of this nature without some reciprocal obligation (para 263) and that the relevant purpose element was satisfied here (para 278)

Anti-overlap: 'Does s 44ZZRU of the CCA apply with the result that the cartel conduct prohibitions in ss 44ZZRJ and 44ZZRK are not engaged?'

Briefly, Justice Gordon held that s 44ZZRU did not preclude the operation of the cartel provision in this case; the overlap was limited to the actual acquisition.

Section 44ZZRU provides an anti-overlap provision for certain acquisitions of shares and assets, providing:

(1) Sections 44ZZRF, 44ZZRG, 44ZZRJ and 44ZZRK do not apply in relation to a contract, arrangement or understanding containing a cartel provision, in so far as the cartel provision provides directly or indirectly for the acquisition of:

(a) any shares in the capital of a body corporate; or

(b) any assets of a person.

This is intended to ensure mergers and acquisitions are subject to the merger provisions and not the cartel provisions of the Act.

Justice Gordon noted that s 44ZZRU 'expressly provides for the primacy of the prohibition against a contract, arrangement or understanding containing a cartel provision' and then carves out the overlap (para 281):

[para 281] 'It is limited in two respects. It is limited to a contract, arrangement or understanding containing a cartel provision in so far as the cartel provision provides directly or indirectly for the acquisition of shares in the capital of a company. In other words, the prohibition continues to apply to balance of the contract, arrangement or understanding containing a cartel provision except to the extent that the cartel provision provides directly or indirectly for the acquisition of shares in the capital of a company. The language of the section is "provides" not "relates to". It is specific in its terms.' [emphasis in original]

[para 282] 'Next, the carve out is limited by the fact that the application of ss 44ZZRJ and 44ZZRK to the relevant contract, arrangement or understanding is preserved by the words "in so far as". So long as the relevant contract, arrangement or understanding can stand with the excluded provision being severed, the balance can and will contravene those prohibitions ... matters that involve a substantial lessening of competition - completed acquisitions of shares - should remain subject to s 50. Other matters - such as the rigging of bids - remain and should remain subject to Div 1 of Pt IV.'

Her Honour then adopted the three step analysis to s 44ZZRU suggested in Beaton-Wells, C and Fisse, B, Australian Cartel Regulation (Cambridge University Press, 2011) at 301:

[para 283] In applying the s 44ZZRU exception to alleged cartel conduct, a three step analysis
may be appropriate:

1. identify the cartel provision in the contract, arrangement or understanding;

2. identify the provision that provides directly or indirectly for the acquisition of the NWS shares; and

3. determine whether the cartel provision in (1) is severable from the provision in (2).

...

In this case her Honour noted that the cartel provision provided that 'Castle Harlan would bid for the NWS shares and Bradken would not bid.' (para 284). The provisions relating to the acquisition of NWS shares were contained in the SPA and SGPA; this was separate from the bid rigging provision which pre-dated these agreements. Her Honour further held that the bidding provision did not 'indirectly' provide for the acquisition of NWS shares; rather, it related to the sales process and not the eventual acquisition of shares (para 284):

[para 284]: Once stage 2 [of the sale process] was complete, and Castle Harlan had lodged a final bid and Bradken had not, the work of the Bidding Provision was complete. For the same reason, s 50 did not and could not apply to the Bidding Provision in the Bid Rigging Arrangement - the provision did not directly or indirectly effect any acquisition. In the present case, the third step in the analysis does not arise.'

Extraterritoriality: 'Is Norcast able to rely upon the conduct of Bradken and Castle Harlan engaged in outside of Australia and, further, can Norcast establish that Castle Harlan was carrying on business within Australia (see s 5 of the CCA)?'

Justice Gordon noted that, pursuant to s 5(1), the CCA applies to conduct engaged in outside Australia by certain persons, including bodies corporate carrying on business in Australia. Her Honour concluded that Bradken was incorporated and carried on business in Australia and that Castle Harlan also carried on business in Australia (see above and para 338 of the judgment). Norcast could rely on conduct engaged in outside Australia. For purposes of the damages claim Ministerial consent was sought and obtained (para 285).

Accessorial liability: 'Was Bradken a person involved in Castle Harlan’s contraventions within the meaning of s 75B of the CCA?  Were Greiner and/or Hodges involved in either or both of Bradken and/or Castle Harlan’s contraventions?'

Briefly, Justice Gordon held that both Greiner and Hodges were involved in both Castle Harlan's and Bradken's contraventions of the cartel provisions.

Justice Gordon noted that there can be no accessorial liability under s 75B were the primary contravention is not established; here the primary contravention was established so it was 'necessary to consider Norcast’s contentions about Bradken’s, Greiner’s and Hodges’
involvements in the Bid Rigging Arrangement' (para 287).

Relevantly, s 75B provides:

'(1) A reference in this Part to a person involved in a contravention of a provision of Part IV or IVB, or of section 95AZN, shall be read as a reference to a person who:

…

(c) has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention; or

…'

Her Honour noted that a 'person [including a body corporate] will only be regarded as involved in a contravention within the meaning of s 75B if the person intentionally participated in the contravention' and this includes 'actual, not constructive, knowledge of the essential matters that make up the contravention' (para 289). However:

[para 289] 'It is unnecessary to prove that the respondent knew that his or her actual participation was a breach of the CCA and ... where there is a combination of suspicious circumstances and a failure to make enquiry, it may be possible to infer knowledge ... Constructive knowledge is not sufficient ...'

Her Honour noted that if there was a principal contravention then Bradken was necessarily also involved in Castle Harlan's contravention. In relation to Hodges and Greiner, her Honour rejected their claims that they did not knowingly or intentionally participate in any contravention, holding that each 'knew of the essential facts and had more to do with the subject matter of the complaint constituting the contravention than simply having some knowledge of the matter' (para 293). Her Honour set out the details of the role and knowledge of each of these parties, noting that Hodges' role and knowledge was more extensive (para 295). Her Honour therefore concluded that 'each of Greiner and Hodges were involved (within the meaning of s 75B of the CCA) in both Castle Harlan’s and Bradken’s contraventions of ss 44ZZRJ and 44ZZRK.' (para 297)

On the issue of damages for bid-rigging

Norcast claimed damages from the respondents.

[298] Norcast submitted that the damages were to be quantified as the difference between the amount that Norcast received for its sale of the shares in NWS (US$190 million) and the amount that Bradken, as the likely highest bidder, but for the contraventions, would have agreed to pay to acquire those shares directly from Norcast. Norcast quantified that difference as at least equal to the US$22.4 million premium Bradken agreed to pay and did in fact pay to Castle Harlan.

Norcast further submitted that the price might have even been considerably higher (at para 299), while the respondents submitted that Norcast had suffered no loss or damage (para 300).

Justice Gordon set out the elements of a damages claim under section 82:

[301] Section 82 has at least five discrete elements: Marks v GIO Australia Holdings Limited [1998] HCA 69; (1998) 196 CLR 494 at [95]. One element is that only a person who has suffered loss or damage may rely on the section: I & L Securities Pty Limited v HTW Valuers (Brisbane) Pty Limited [2002] HCA 41; (2002) 210 CLR 109 at [42]- [45]. Another element is the causal requirement that the injury be sustained by the contravention: Marks at [95]. If the Court finds that damage has occurred, it must do its best to quantify the loss even if a degree of speculation and guess work is involved: Enzed Holdings Ltd v Wynthea Pty Ltd [1984] FCA 373; (1984) 57 ALR 167 at 183. Of course, loss or damage includes economic or financial loss as well consequential loss which is a direct result of the conduct in question: Wardley Australia Limited v Western Australia [1992] HCA 55; (1992) 175 CLR 514 and Frith v Gold Coast Mineral Springs Pty Ltd [1983] FCA 28; (1983) 65 FLR 213 at 232.

In this case Justice Gordon rejected the Respondents' claim that Norcast suffered no loss or damage because it was happy with Castle Harlan's bid and would not otherwise have achieved a higher price (para 302) and continued:

[303] Damages are assessed at the difference between the US$212.4 million including costs and expenses which Bradken did in fact pay to acquire NWS and the US$190 million Norcast received from Castle Harlan. In assessing the loss or damage, there is necessarily a degree of estimation. However, that assessment proceeds on the basis of some established facts. First, the sale process was competitive. Despite Bradken’s assertions to the contrary, an assessment of loss or damage should not take into account the possibility that Bradken would have been able to "discover" the other bids before making its own bid in a competitive bid process. Second, the bidding process was confidential. As a result, the contention that underpinned much of this section of Bradken’s submissions, that it would have known that US$190 million was the price against which it had to bid, falls away. Third, as the factual analysis demonstrates, there were significant strategic considerations (including synergies) for Bradken in seeking to acquire the business: see [37], [38], [42], [88], [99] and [101]-[104] above. Even Greiner acknowledged that because there were synergies between Bradken’s and NWS’ businesses, Bradken was able to be "a little more aggressive" in terms of the multiple of NWS’ EBITDA which it was prepared to offer.

Her Honour set out some further facts suggesting that US$212.4 was a reasonable estimate of the amount Bradken might have paid absent the agreement (at para 304) and concluded:

[305] Accordingly, I find that Norcast suffered loss or damage and assess that loss or damage at US$22.4 million (being the difference between the US$212.4 million including costs and expenses which Bradken did in fact pay to acquire NWS and the US$190 million Norcast received from Castle Harlan).