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Slater & Gordon’s Medibank class action temporarily stayed
The Federal Court has temporarily stayed Slater & Gordon’s Medibank class action as the Australian Information Commissioner “backflips” on its decision to investigate a representative complaint lodged by a competing firm late last year.
Naomi Neilson
Justice Jonathan Beach made an order for the temporary stay on Friday morning (12 May) despite strong objections from Slaters that it could be seen as the Federal Court favouring Baker McKenzie's class action because its firm arrived at the table first.
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“Your Honour will put the court in a position (where) one proceeding should be preferred over another, albeit on a temporary basis,” a representative for Slaters submitted.
Slaters added it was concerned Medibank would “stop talking to us”.
The firm also defended filing the class action earlier this month as opposed to the lodgement in November last year and suggested Slaters’ application could be more substantial.
“If it was the case where we simply photocopied the plea and thrown it in, I would understand Your Honour’s cynicism. But there has been careful consideration,” the Slaters representative said.
Justice Beach defended his order by telling Slaters it was not a “plain, vanilla, commercial class action” and would need to be dealt with efficiently by the court or run the risk of the trial being pushed back.
“The alleged breach and use or misuse of information is obviously something that should be addressed sooner rather than later.
“We are not just dealing with damages, we are dealing with injunctions as well, in terms of requiring information to be destroyed and all sorts of things. These things have to be dealt with quickly.
“This particular context justifies something you may not be happy with,” Justice Beach said.
Justice Beach acknowledged that other than “some bells and whistles”, both firms were seeking compensation and damages on behalf of group members who were impacted by the cyber attack.
The matter will return in August, and the court will hear applications from both firms' about the possibility of a permanent stay, or whether they would be willing to consolidate.
It comes after the Office of the Australian Information Commissioner told the parties late on Thursday afternoon that it had decided to investigate the representative complaint at the same time as its own investigation into the breach.
It is essentially a ”backflip” on its decision late last year not to do so.
During Friday’s case management hearing, Justice Beach acknowledged Bakers' had been “more proactive” than Slaters in lodging the representative complaint.
Justice Beach also effectively ruled out the possibility of both class actions proceeding in parallel.
“It’s in the interest of all parties to order that yours be stayed until further order and put a timetable in place to deal with the question of competition.
“The other option is the proceedings go ahead in parallel. I think I can say to you that it is very unlikely that I am going to allow that to take place,” Justice Beach said.
