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High Court refuses to grant a Norwich Pharmacal order (“NPO”) to identify discloser of potentially privileged material

  • United Kingdom
  • Financial services disputes and investigations
  • Litigation and dispute management - Norwich Pharmacal Orders

08-12-2018

Blue Power Group Sarl & Ors v ENI Norge AS & Ors [2018] EWHC 3588 (Ch)

Facts of the case

– Various Italian oil companies (the “Ds”) were defendants to an existing claim by certain energy research companies (the “Cs”). 

– In the course of the main claim, the Ds became aware that the Cs were in possession of certain information and documents that were potentially covered by the Ds’ professional privilege, such that they had, it seemed, been “leaked” from the Ds to Cs.

– The Ds applied for a NPO to compel disclosure of the identity of the person who wrongfully communicated the information and documents to the Cs.

– The Cs opposed Ds application on a number of grounds, including that:

– the Court had no jurisdiction to grant an NPO in the context of existing proceedings, and instead new proceedings would need to be issued;

– the NPO was in any event unnecessary where there were existing proceedings, as all relevant issues would be aired ultimately at the trial of the main claim; and

– any legal proceedings resulting from information sought would likely take place be in Italy.

The decision

– Mr Justice Zacaroli held that:

– an NPO could be made in the context of existing proceedings, and requiring new proceeding to be issued would be “a triumph of form over substance”; 

– an NPO was not rendered unnecessary in circumstances where the alleged wrongdoing was not an issue in the main proceedings, and the Ds needed to identify the source of the leak

before the trial; and

– foreign legal proceedings were unlikely as they were not necessary for the Ds to achieve their stated objective of preventing further wrongful disclosure.

– However, Mr Justice Zacaroli ultimately refused to grant the NPO because he found that inter alia: 

– the Ds had failed to demonstrate that they could not obtain the information from within their own organisation;

– whilst the Judge accepted that it was at least arguable that wrongdoing had occurred (on the basis that it was accepted that the documents were potentially privileged and their supply to the Cs had not been authorised), he considered that the Ds’ case on this point was “very weak” because (i) the exchange of confidential documents between the Ds and the Cs was commonplace and (ii) Italian law did not recognise privilege in respect of some of the documents; and

– the primary purpose of the application (as acknowledged by the Ds) was to prevent further disclosures, and on the evidence there was minimal risk of this happening. 

Analysis and practical advice

– Where a party to litigation discovers that it holds documents belonging to the other side that are prima facie privileged, the Court will generally expect reasonable co-operation from that party. That co-operation will normally include ensuring that the party has identified and delivered up and/or deleted copies of all such documents. That is likely to involve at least some explanation, to the extent such party is able to, of how it acquired them, in order to justify its conclusion that it has identified all of the relevant material. 

– It is now established that there is no jurisdiction to make a NPO if the information sought is for use in foreign proceedings. It was also held by Flaux J in Ramilos Trading v Buyanovsky [2016] CLC 896 that it was not possible to bypass this fact simply by asserting that the case was at such an early stage that it could not be said proceedings would be instituted abroad. In the present case, however, the Ds could point to purposes for which they needed the information which did not involve foreign proceedings, including (i) isolating the wrongdoer, once identified, from access to any confidential or privilege information, (ii) dismissing the wrongdoer and (iii) taking disciplinary proceedings against them. This is because there is no requirement for the purposes of the NPO jurisdiction that the applicant intends to bring an action against the wrongdoer. It is sufficient that the applicant wishes to obtain some redress, or even protect itself against further wrongdoing.

 

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