Kerry Stokes has suffered another loss in the long-running C7 case with a full bench of the Federal Court rejecting its appeal against its 2007 comprehensive loss in the $200 million trade practices suit.
The decision was handed down in a a brief hearing this morning in the court in Sydney with Justices John Dowsett and Bruce Lander dismissing the appeal in joint reasons. A summary of the 340-page judgement was published here on the Federal Court website. The judgment itself and background follow the summary.
The third judge on the Full Court bench who heard the appeal, Justice John Mansfield, said he had reached a different view in two respects “on matters which do not affect the outcome of the appeal”.
The summary makes clear Seven has again lost comprehensively.
The appeal, which was heard in November 2008, involved a smaller group of opponents than the 22 named in Seven’s original multimillion dollar case case alleging a collusion to run its pay television arm, C7, out of business.
The victorious parties were News Ltd, Consolidated Media Holdings (now 22% owned by Seven), Telstra, Sky Cable and Foxtel. Foxtel is owned by Telstra and Sky Cable, itself a joint venture of News and CMH.
(That sort of makes Stokes a loser and a part-winner out of the appeal).
But that didn’t mean Stokes or Seven were going to open up after the judgement was given, as this brief statement made clear.
“Seven Network Limited is considering the 340-page judgment of the Full Federal Court in its pay television access case in which Seven’s appeal was dismissed today.
“In Seven’s opinion, the importance of the issues to its business justified pursuing this appeal, given that costs in appeals are far more contained as they focus on legal analysis.
“There will be no further statement whilst the full judgement is considered.”
In the original suit, Seven had also targeted Optus, the Ten Network, the AFL, the Australian Rugby League, the National Rugby League, and various subsidiaries of News, Cons Media and Telstra.
Justice Mansfield said no orders had been made about the costs of the appeal but he expected that “costs would follow the event”, foreshadowing an order that Seven pay most of its opponents’ legal bills.
In a 1160-page judgment handed down in July 2007, Justice Ronald Sackville rejected all of Seven’s claims and criticised the cost and burden to the court of the 120-day hearing. Seven spent $100 million on lawyers and expert witnesses and paid about 60% of the costs of its successful opponents. It paid $24 million to News, $13 million to Telstra, and undisclosed amounts to the others.
It might have been expensive, but the C7 case has been topped for lengthy and size of judgement by the ASIC case against Jodee Rich and Mark Silberman over the collapse of One.Tel.
Does Ch 7 and K.Stokes especially really get the message? When a presiding judge identifies an important witness as “evasive and untruthful” is it likely that an appeal is going to succeed? And that witness has since engineered the takeover of WA’s only daily newspaper turning it into the ‘vanilla slice’ of all such publications in Australia. Paul Armstrong, the heavily criticised former editor, at least ran hard-hitting stories and if you didn’t like what he served up you didn’t have to buy the paper. But now – to satisfy the white-bread approch designated by the new owner WA is served up a daily dose of feel-good stories. Ch 7’s shareholders will of course bear the ultimate cost of this folly.