CATCHWORDS Trade Practices - Circular letter alleged to be contract, arrangement or understanding substantially lessening competition ~ Conduct alleged to constitute exclusive dealing. Practice - Application seeking dismissal of proceedings on the ground that they disclose no cause of action ~ proceedings alleged to be frivolous and vexatious - Jurisdiction to dis- miss or stay proceedings - Consideration of principles applic- able in exercise of jurisdiction. Trade Practices Act, 1974 ss. 45 and 47 Federal Court Rules Order 20 Rule 2 PLUTEUS (NO. 8) PTY. LIMITED V. G.J. COLES & COY. LIMITED; JOSEPH P. MONAHAN JR; DENNIS OWEN; JOHN DAVIDSON No. G 145 of 1983 Beaumont, J. Sydney 26 Sytnmey;, 1983. AUGUST: wt IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION BETWEEN: ee ee ee No. G145 of 1983 PLUTEUS (NO. 8) PTY. LIMITED i ORDER Judge making order: Date of order: Applicant G.J. COLES & COY. LIMITED First Respondent JOSEPH P. MONAHAN JR. Second Respondent DENNIS OWEN Third Respondent JOHN DAVIDSON Fourth Respondent Beaumont, J. 26 August, 1983. Where made: Sydney. THE COURT ORDERS THAT: 1. I order that the application be dismissed. 2. I order that the costs of the application be reserved. 3. I fix 2 September, 1983 as the date within twenty one days after which any notice of appeal shall be filed and served for the purposes of Order 52 Rule 15(1) (a) (iii). IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) ) ) GENERAL DIVISION No. G145 of 1983 BETWEEN: PLUTEUS (NO. 8) PTY. LIMITED Applicant AND: G.J. COLES & COY. LIMITED First Respondent JOSEPH P. MONAHAN JR. Second Respondent DENNIS OWEN Third Respondent JOHN DAVIDSON Fourth Respondent CORAM: Beaumont, J. DATED: 1G Auge 5 |q33 REASONS FOR JUDGMENT Introduction This is an application by the respondents to these proceedings seeking, in essence, that the proceedings and the application for interlocutory relief be dismissed on the ground that they disclose no cause of action and are there- fore frivolous and vexatious. The inherent jurisdiction and the jurisdiction of the Court under 0.20 r.2 are sought to be invoked. The proceedings are brought by the applicant ("Pluteus") as the vehicle, for that purpose, of the Australian Sales Promotion Association. The respondents are G.J. Coles & Coy. Limited ("Coles") and three of its executives. The application for interlocutory relief In its application, Pluteus seeks both permanent relief and interlocutory relief until further order as follows: 1. An injunction restraining Coles from imposing a con- dition on the acquisition of goods or on offers to acquire goods that the packaging of the goods does not contain promo- tional material of any of the following kinds: (a) Promotions offering cash refunds to participants who collect single or multiple labels/packs. (b) Competitions which have a large number of prizes com- prising merchandise sold by Coles e.g. first prize 100 BMX bikes. (c) Promotions which involye the participant sending money to the promoter or manufacturer. (d) Promotions which carry no retail support funds. (e) Bonus packs which offer as an attachment or refund, merchandise sold by Coles unless appropriate loss of profit is allowed over and above normal level of support funds related to the promotion. 2. An injunction restraining Coles from making or giving effect to any contract or arrangement, or arriving at or giving effect to any understanding whereby the acquisition of goods is subject to a condition that the packaging of goods does not contain promotional material of any of the foregoing kinds. 3. An order restraining Coles from further publishing the circular letter which is annexed to the statement of claim {see below). 4. Consequential relief. In order that the parties and the Court could better understand the nature of the claims made, Pluteus filed a statement of claim which is appended to these reasons. In addition, further and better particulars of the claims were sought and, to some extent, supplied. Central to the case sought to be made by Pluteus is the circular letter from Coles annexed to the statement of claim as follows: "This is to advise that effective forthwith, we are reducing support for certain types of 'on-pack' com- petitions and promotions. Our intention is to curtail activity which merely moves the"'sales dollar from one brand to another and to en- courage activity which assists our company to increase market share, or increase the total market segment. The categories which will be rejected by us are as follows: - Promotions offering cash refunds to participants who collect single or multiple labels/packs. ~ Competitions which have a large number of prizes comprising merchandise we Sell in our retail outlets, e.g. first prize 100 BMX bikes. - Promotions which involve the participant sending money to the promoter or manufacturer. Cy - Promotions which carry no retail support funds. - Bonus packs which offer as an attachment or refund, merchandise we sell in our retail outlets unless appropriate loss of profit is allowed over and above normal level of support funds related to the promotion. Our buyers and promotions personnel would be happy to discuss alternate activity which could reflect a value- for-money profile compared to the gimmick image of some 'on-pack' promotions. Consumer promotions already approved by this office will be honoured with our, usual support. Separate entry forms are still unacceptable at fixture level and/or at the check-out. We do permit approved entry forms to be used in off-location displays in our stores if organised through (a) our state promotions department for Supermarkets, (b) the appropriate buyer in Head Office Melbourne for Variety Stores and K marts. All promotions will still be assessed on merit and are still to be submitted to our head office, well in ad- vance of the launch, preferably prior to final printing of entry forms or packaging. Such submissions should be made to Mr. J. Davidson in supermarket division for supermarket promotions or the appropriate buyer, general merchandise division for Variety and K mart promotions. (Sgd.) D. Owen (Sgd.) J. Monahan Jnr. D. Owen, Jd. Monahan Jnr. General Manager Merchandise, Director, SUPERMARKET & FOODSERVICE GENERAL MERCHANDISE DIVISION" DIVISION In support of its application for interlocutory relief, Pluteus relies principally upon an affidavit sworn by its solicitor, Mr. Anisimoff. He there gives evidence of a con- versation on 31 May, 1983 with Mr. Davidson, the fourth res- pondent and the person referred to in the circular letter as follows: "Mr. Davidson then said to me 'Coles are not interested in promotions which merely encourage the consumer to purchase a product and do not encourage the consumer to purchase it at Coles. We wish to have promotions which are exclusive to us. Traditional sales promotion techniques generally do not benefit us and in most cases take sales away from more profitable lines which are not running a sales promotion. Unless a satisfactory arrangement as to profit sharing and/or other retail contribution is arrived at a product which carries the promotional techniques referred to in the letter (meaning the aforesaid circular letter) will not be accepted by us'." Mr. Anisimoff gives evidence in his affidavit of a later conversation as follows: "On Thursday, June 9, 1983 I contacted Mr. Davidson again, by telephone, and to the best of my recollec- tion, the following conversation took place: I said: 'We met last Tuesday week. I would like, if possible, to confirm again the policy of Coles in relation to sales promotions. You know I act for many of your suppliers and sales promotion companies and they are very concerned about your policy. Some do not believe the policy is as strict as you say and they have specifically asked me to clarify it with you.' Mx. Davidson replied: 'Yes.' I said: 'Could you please make sure I have it straight? As I understand it you wish all suppliers to submit to you as early as possible, sales promotional offers. If they submit finished pro- motional product without having received this prior approval and product falls within the categories of the letter you have just sent out, you won't stock that product.' Mr. Davidson replied: 'That's right.' I said: 'If it is a $2.00 refund offer on that pack, would you run that pack?! Mr. Davidson replied: 'No.' I said: 'What if suppliers supplied Coles with plain packs and other retailers with promotional packs?' Mr. Davidson replied: 'We would expect them to give us some incentive to want to stock that product before we would support that product otherwise we would support somebody else's product.' I said: 'As well as supporting somebody else's product, would you delist the product?' Mr. Davidson replied: 'It could be delisted or they could may be redesign their pack promoting their product.' I said: 'Could it possibly be delisted?' Mr. Davidson replied: 'We would treat each one on its own merit.' I said: 'The five categories in the letter, are they strict? Can they be negotiated at all?! Mr. Davidson replied: 'Each one is treated on its own merit. If they come in in advance there may be only a couple of minor changes.' I said: 'What type of things are you looking for to get these things through? Are there any type of criteria that my clients should look for?' Mr. Davidson replied: 'If they come down to see me 1n initial planning stages there is no hassles. They could be ironed out before they go to print and they could extract retail support you see. Cadburys are giving away a couple of stereos and 2000 records. We are not allowing this promotion. If they were giving away say 100 records, maybe. But 2000 records, no way. That is 1900 records we could have sold to potential customers.' I said: 'What about Category 1, promotions offering cash refunds?' Mr. Davidson replied: 'In the case of $2.00 refund, I have just knocked one back, they must give us plain stock only. You see they should give us a 10% reduc- tion on product plus $10,000-$12,000 and we will give them display space for a sale in Coles.' I said: 'You would not run the cash refund offer?' Mr. Davidson replied: 'No.' I said: 'What would be the situation if they tried to offer other retailers the promotional pack and gave you the plain pack? Would that be a problem?' Mr. Davidson replied: 'Yes. This disadvantages us by having a $2.00 refund in Woolies. We feel a cash refund is of no benefit to the consumer because redemption rate is so low. It is taking sales away from products which may be giving us more productivity.' I said: 'It curtails your productivity?' Mr. Davidson replied: ''Yes.' I said: 'But it also reduces competition between products.' Mr. Davidson replied: 'Yes. I know. But cash refunds create problems for us. No way can we run these promotions. In the case a guy wants to give $2.00 to charity we will go along with that or a community type charity.' I said: 'What about self-liquidating offers?' Mr. Davidson replied: 'No way.' I said: 'No way?' Mr. Davidson replied: 'No way. With the exception of Kelloggs who have a promotion in conjunction with the Olympic Games.' I said: 'Would there be a client of mine whose promotion has been knocked back?! Mr. Davidson replied: 'Napisan - Milton.' I said: 'No that's not one of mine.'" Pluteus also relies upon some dealings between Coles and Cadbury Schweppes Pty. Ltd. ("Cadbury") in respect of a promotion known as "Cadbury Crack the Crunchie Sound". As part of the promotion, Cadbury offered "consolation" prizes of 250 long playing records drawn every week for eight weeks from 27 June to 15 August, 1983. In response to this promotion, Mr. Davidson wrote to Cadbury on 10 June, 1983 saying: "We confirm our telephone conversation of June 9, 1983, regarding the above promotion and advise that this promotion is unacceptable to Coles in the area of 'com- petitions which have a large number of prizes comprising merchandise which we sell in our outlets' e.g. L.P. records. We will be advising our states of our decision." Mr. Anisimoff was not cross-examined. Coles called no evidence. The present application The proceedings having only just commenced and a hearing date having been fixed for the application for interlocutory relief, Coles took the somewhat unusual course of moving immed- lately for dismissal of the proceedings as a whole, essentially on the basis that no cause of action was disclosed. Coles was not content to wait until the application for interlocutory relief was made and then to resist it. Rather, mainly with the hope of avoiding the expense of lengthy hearings, at both the interlocutory and final stages of the proceedings, Coles elected to seek the immediate dismissal or at least the permanent stay of the proceedings, including the application for interlocutory relief. The very nature of such an application which, 1f successful, would stifle the litigation at its inception, indicates that "a case must be very clear indeed to justify the summary intervention of the Court to prevent a plaintiff submitting his case for determination in the appointed manner by the Court ..." (Dey v. Victorian Railways Commissioners (1949) 78 C.L.R. 62 at p.91 per Dixon, J.). Thus, as Dixon, J. says (at p.91), once it appears that there is "a real question" to be determined, whether of fact or of law and that the rights of the parties depend upon it, then it is not competent for the Court to dismiss the action as frivolous and vexatious and an abuse of process. The test to be applied in this connection was also discussed by Barwick, C.J. in General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) (1964) 112 C.L.R. 125 at pp.129-130. The Chief Justice, after referring to the reasons of Dixon, J. in Dey's case, concluded as follows (at p. 130): "Although I can agree with Latham C.J. in the same case when he said that the defendant should be saved from the vexation of the continuance of useless and futile proceedings (1949) 78 C.L.R. at p.84), in my opinion great care must be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal. On the other hand, I do not think that the exercise of the juris- diction should be reserved for those cases where argument is unnecessary to evoke the futility of the plaintiff's claim. Argument, perhaps even of an extensive kind, may be necessary to demonstrate that the case of the plaintiff is so clearly untenable that it cannot possibly succeed." - 10- The case sought to be made by Pluteus Pluteus put its case in a number of ways. In the first place, 1t says that the circular letter, if accepted by the sup- pliers, will be capable of constituting a contract, arrangement or understanding of the anti-competitive type prohibited by s.45. If necessary, Pluteus also relies upon s.45A in this connection. Alternatively, Pluteus argues that the circular letter and other conduct indicated in the views attributed to Mr. Davidson con- stitute or would, if implemented, constitute the practice of ex- clusive dealing outlawed by s.47. On each of its arguments, Pluteus refers to the evidence of Mr. Davidson as an indication that Coles is attempting to eliminate the rejected type of promotions not only in its case but also in the case of other retailers. The fate of the present application Coles assumes a heavy onus indeed in seeking the summary dismissal of proceedings of this kind. One can appreciate that at may well be appropriate to consider, and if necessary, strike out, proceedings where the whole argument in the case turns upon a bare legal question such as that of statutory construction. Dey and Generali Steel provide examples of this type of case. However, in the present case, no such legal issue really emerged in any isolated form although the argument in the application occupied some days. Many of the questions debated before me indicated that, when the matter proceeds to trial, a number of -ll- factual issues will need to be resolved. It is true that the jurisdiction, inherent and statutory, to stay or dismiss proceedings as an abuse of process may be exercised if the dispute centres only on an issue of fact. Cox v. Journeaux (No. 2) (1935) 52 C.L.R. 713 as a striking illustration. There, Dixon, J. made it clear (at p.720) that the jurisdiction is not limited to cases where there is no dispute of fact but emphasised (ibid.)that "the principle, in general paramount, that a claim honestly made by a suitor for judicial relief must be investigated and decided in the manner appointed, must be observed. A litigant is entitled to submit for deter- Mination according to the due course of procedure a claim which he believes he can establish, although its foundation may in fact be slender." In the present case, it is possible to isolate three main areas of contention between the parties. First, an issue arises as to the proper construction of the circular letter and, possibly, the conduct of Coles and its suppliers in that regard. Whether these circumstances reveal the requisite consensus so as to throw up a contract, arrangement or understanding of the type outlawed by s.45 will in the end, I think, fall to be resolved as a question of fact (see Trade Practices Commission v. Email Ltd. (1980) 31 A.L.R. 53 at p.56.). -12- Secondly, a similar question, also ultimately of fact, arises in the context of s.47. In particular, an issue arises between the parties as to whether the condition, alleged to arise from the terms of the circular, and possibly, any related con- duct, imports the requisite degree of obligation contemplated by s.47 (see SWB Family Credit Union Ltd. v. Parramatta Tourist Services Pty. Ltd.(1980) 32 A.L.R. 365). In the end, I appre- hend that the determination of this question will turn, to a substantial degree, upon the intentions of those parties in that behalf. Thirdly, and most importantly, an issue arises whether the conduct complained of has the necessary anti-competitive element. Here, a question of principle does arise. Coles argues that because its sole activity is that of a retailer of goods, it can never be said to be in competition with its suppliers who operate in a different market, that of the wholesale of goods. Pluteus, on the other hand, submits that the conduct of Coles now challenged has an impact upon competition at several levels: for one thing, as Mr. Davidson acknowledged, to inhibit the marketing methods of a particular supplier to Coles could readily affect that supplier's ability to compete in the wholesale market with other suppliers of that product or of similar products; a fortiori when the ban extends beyond Coles to other retailers. For another, the Cadbury example and the case of Coles' house brands show that the objective sought to be achieved by Coles, as indicated in its circular letter and otherwise, is to improve the sales of products marketed by Coles at the expense of products marketed elsewhere. Whether -13- the latter examples indicate a breach of s.45 or s.47 is very much an open question. The propositions advanced by Pluteus in this behalf are novel and the arguments to the contrary are formidable. In particular, I was much impressed with the submission put by Coles that, since 1t could never be said that Cadbury was engaged in the retail sale or wholesale of long playing records, it must follow that Cadbury was never operating as a competitor in either of those markets. Therefore, Coles says, steps taken to prevent Cadbury from offering long playing records to purchasers of its products can have no bearing upon competition in those markets for the purposes of s.45 or s.47. Whatever may be the ultimate merits of the respective arguments, at present I find myself unable to reject either branch of the argument advanced by Pluteus as raising no "real question" of fact or of law. The former aspect of the argument certainly raises such a question. With some hesit- ation, I am of the view that the latter aspect does so as well. In 1ts application, Coles seeks, in the first instance, to strike out the whole of the statement of claim. Ina modern system of pleadings upon an application to strike out a statement of claim as disclosing no reasonable cause of action, the question is whether 1t would be open to the plaintiff upon the pleadings to prove facts at the trial which would constitute a cause of action (see Mutual Life and Citizens' Assurance Co. Ltd. v. Evatt (197i A.C. 793 at p.801 citing Dorset Yacht Co. Ltd. v. Home Office 1970: A.C. 1004). For this purpose, Coles must, and did, accept that the allegations of fact made in the statement of claim are to be assumed to be correct. Alternatively, Coles seeks the summary dismissal of the applic~ ation for interlocutory relief. So far as the evidence is concerned, Coles is again placed in the difficult position, in this application, of not being able to demonstrate what further evidence, if any, Pluteus may seek to adduce in support of its claim for an interim injunction. No directions have, as yet, been given as to the manner in which that evidence is to be adduced. At the moment, it 1s simply not possible for Coles or the Court to indicate what will be the evidence to be relied upon by Pluteus when the applications for interim and final relief are made. When it is appreciated that questions of fact, including questions of an economic nature, lie at the heart of the contest between these parties, the weight of the onus to be discharged bv Coles in this application becomes clear. It 1S possible, no doubt, to conceive of a successful application to strike cut proceedings of this kind where the key issue in the litigation consists of a dispute as to the economic effect, in terms of competition in a market, of the conduct under challenge. But the very nature of the enquiry to be undertaken suggests that such a successful application must be a rara avis indeed. In the result, I am not persuaded that, on the material before me, Pluteus has failed to tender an issue which raises a real question of fact or of law. The application must be refused. T certify that this and the 13 preceding pages are & true copy of the Reasons for Judgment herein of his Honour Mr Justice Usuet t ~~ Linn Ara es foas 4 aed | Auguer 1993 ann Pa . ~ , _ " . ae "4 APPENDIX i aren aes _ (er 28 fE/ ga IN THE FEDERAL COURT OF AUSTRALIA ) NEW SOUTH WALES DISTRICT REGISTRY ) GENERAL DIVISION ) No. Gi45 of 1983 BETWEEN: PLUTEUS (NO. 8) PTY. LIMITED Applicant AND: G.J. COLES & COY. LIMITED First Respondent JOSEPH P. MONAHAN JR. Second Respondent DENNIS OWEN Third Respondent JOHN DAVIDSON Fourth Respondent STATEMENT OF CLAIM 1. The applicant is a company duly incorporated and able to sue in and by 1ts said corporate name and style. 2. The first respondent 1s and was at all material times a trading corporation within the meaning of the Trade Practices Act, 1974 (hereinafter "the Act") and liabie to be sued in and by its said corporate name and style. 3. During 1983 the First respondent carried on business, inter alla, as a retailer of manufactured goods in every state and territory in Australia. 4. During 1983 the first respondent was the largest retailer in terms of sales revenue in the Commonwealth of Australia. PARTICULARS In the year ended 30th June, 1982, the retail sales of the first respondent exceeded $4,000,000,000. It was the only retailer in Australia whose sales exceeded this figure. It is believed that this is still the case. At all material times the First Respondent purchased goods for distribution within reta1l outlets operated by it, including goods which are manufactured and packaged expressly to specifications of the First Respondent and not distributed by any other retailer (hereinafter called "the house brands"). Particulars of House Brands The First Respondent distributes goods under the house brands "Plain Wrap", "Farmland" and "Embassy". On or about the 23rd May, 1983, the first respondent sent a circular letter, in the form of the letter annexed to this statement of claim ("the circular letter"), to a large number of persons who supplied goods to it for retail trade. N PARTICULARS OF RECIPIENTS The applicant will supply full details of the recipients of this letter after discovery and interrogatories. They included Kellogg (Aust.) Pty. Limited, Uncle Bens of Australia Pty. Ltd., Kraft Ltd., Wella (Australia) Pty. Ltd., Richardson Vicks Pty. Ltd., Cadbury Schweppes Ltd. and Cottees General Foods Ltd. In sending the said letter the first respondent was attempting to make with the recipients contracts or arrangements or arrive at understandings one provision of which had the purpose or had or was likely to have the effect of substantially lessening competition. PARTICULARS OF ATTEMPTED CONTRACTS ARRANGEMENTS OR UNDERSTANDINGS The attempted contracts arrangements or understandings were that suppliers of goods would not package their goods for general supply or for supply to the first responent so at to contain promotional material of the kinds referred to in the letter. PARTICULARS OF SUBSTANTIAL LESSENING OF COMPETITION (a) The effect of the attempted contracts arrangements or understandings would be substantially to lessen competition between suppliers of goods to the first respondent inter se and between the first respondent as a supplier of the house brands and their supplier of goods by reducing in each case the scope of sales promotion. (b) The provision had the purpose or had or was likely to have the effect of controlling or maintaining or providing for the controlling or maintaining of discounts allowances rebates or eredits (insofar as the promotions offered these items) in relation to goods supplier or to be supplied by the proposed parties to the proposed contract arrangement or understanding. Pursuant to the said letter the first respondent made with certain recipients contracts or arrangements or arrived at understandings one provision of which had the purpose or had or was likely to have the effect of substantially lessening competition. PARTICULARS OF NATURE OF CONTRACTS ARRANGEMENTS OR UNDERSTANDINGS The contracts arrangements or understandings were that suppliers of goods would not package their goods for general supply or for supply to the first respondent to as to contain promotional material or the kinds referred to in the letter. PARTICULARS OF SUBSTANTIAL LESSENING OF COMPETITION (a) (b) The effect of the contracts arrangements or understandings was substantia lly to lessen competition between suppliers of goods to the first respondent and between the first respondent as a supplier of the house brands and their suppliers of goods by reducing in each case the scope of sales promotion. The provision had the purpose or had or was likely to have the effect of controlling or maintaining or providing for the controlling or maintaining of discounts allowances rebates or credit (insofar as the promotions offered these items) in relation to goods supplies or to be supplied by the proposed parties to the proposed contract arrangement or understanding. PARTICULARS OF CONTRACTS ARRANGEMENTS OR UNDERSTANDINGS (a) The first respondent has made a contract or arrangement or entered into an understanding with Kellogg (Aust.) Pty. Ltd., that, in consideration of the first respondent continuing to acquire or (b) (¢) (d) acquiring breakfast cereals from it, that company would not engage in a free film processing promotion. The first respondent has made a contract or arrangement or entered into an understanding with Wella (Australia) Pty. Ltd. that, in consideration of the first respondent continuing to acquire shampoo from it, that company would not engage in a cash refund promotion. The first respondent has made a contract or arrangement or entered into an understanding with Richardson Vicks Pty. Ltd. that, in consideration of the first respondent continuing to acquire nappy detergent from it, that company would not engage in a two dollar cash refund promotion. The first respondent has made a contract or arrangement or entered into an understanding with Cadbury Schweppes Ltd. that, in consideration of the first respondent continuing to acquire confectionery from 1t, that company would not engage in a sweepsakes lotcery promotion with 2,000 records as prizes. The first respondent has made a contract or arrangement or entered into an understanding with oN bh Kraft Ltd. that, in consideration of the first respondent continuing to acquire food products from 1t, that company would not engage in a sweepstakes lotter promotion with prizes. Particulars of further contracts arrangements or understandings actually entered into of a similar Nature pursuant to the circular letter will be provided after discovery and interrogatories. (£) The First Respondent has made a contract or arrangements or entered into an understanding with Nestle Australia Ltd. that in consideration of the First Respondent continuing to acquire or acquiring coffee substitutes from 1t, that company would not engage in a $1.50 cash back promotion of "Ecco" coffee substitute. The first respondent has during 1983 offered to acquire goods on the condition that the person fe¢em whom it offered to acquire them would not supply goods or services of a particular kind or description to any person or to the following particular classes of persons. (a) retailers. 10. (b) (a) (b) (c) (d) customers of other retailers who might acquire from them goods with the subject promotions. customers of the first respondent who might acquire such goods from it. PARTICULARS The said circular letter The refusal of persons named in that circular letter to permit the goods to be packaged with promotions for other retailers and without promotions for the first respondent. The refusal of those persons to permit the goods to be packaged with promotions for the first respondent. The effect of the condition would be to prevent suppliers supplying the goods and services constituting the promotion to the said customers. The first respondent has during 1983 acquired goods on the condition that the person from whom 1t acquired them would not supply goods or services of a particular kind or description to any person or to the following particular classes of persons:- 11. 12. 13. (a) retailers, (b) customers of other retailers who might require from them goods with the subject promotions, (c) customers of the first respondent who might require such goods from it. PARTICULARS The applicant repeats the particulars set out after paragraphs 7, 8 and 9 above. The conduct referred to in paragraph 9 and 10 hereof has the purpose or has or is likely to have the effect of substantially lessening competition. By reason of the facts and matters referred to in paragraphs 6 to 8 hereof the first respondent has made a contract or arrangement or arrived at an understanding contrary to the provisions of sub-section 45(2) of the Act or alternatively attempted to contravene the said provisions. By reason of the facts and matters referred to in paragraphs 9 to 11 hereof the first respondent has engaged in the practice of exclusive dealing contrary to the provisions of sub-section 47(1) of the Act or alternatively has attempted to engage in the said practice. 14. At all material times the second, third and fourth respondents were employees of the first respondent. 15. At all material times the second, third and fourth respondents (a) aided and abetted, (b) counselled or prevailed, (c) induced, or (d) were knowingly concerned in or party to the contraventions by the first respondent of the provisions referred to in paragraphs 12 and 13 hereof. DATED June 29, 1983 eoreee OD Solic for the Applicant G J COLES & COY LIMITED {Incarparated wn viclorea} 236 Bourke Street Melbourne Austrata 3009 Telepnone 667 4111 Telex AA34050 Telegraphic Address Cotesanco GPO Box 1698P Melbourne 3001 This is to advise that effective forthwith, we are reducing supporc for certain types of "on-pack" competitions and promotions. Qur intention 18 to curta2] activity which merely moves the sales dollar from one brand to annther and to encourage activity uhich assists our company to increase market share. or increase the total market segment The categories yhich will be rejected by us are as follows :- - Promotions offering cash refunds to perticipants who collect single or multiple labels/packs. Ss comprising - Competitions which have a large number of prize e.g. first prize 100 9°. merchandise we sell in our reteil outlets, bikes. Promo! .ons nich involve the participant sending money to the promocer or manufacturer. - Promotions which carry no retail support funds. - Benus packs which offer .s an artachment or refund, merchandise ye sell in our retail ourlets unless socropriate loss of profit is alloved over cnd avove norndl level of support funds related to tre promotion. Nur Suyers ard orometions personnel would be happy to discuss alternate swchivit, which coula reflect a value-for-money orofile compared to the qimmict image of some "on-pack" promotions. Lonsuner promotions already approved by this office will be horourea uith our usual supnort. Separate entry Forms are still unaccepLable at fixture level and/or at the eneck-out. 'Je Jo permit approved entry forms to be used in of F~location displays in our stores if organised through (a) our state promotions department far Supermartets, (bd) the appropriate buyer in dead Office Nelbourne for Variety Stores % K marts. \l] promotions vi"l still be essessed on merit and are still to be submitted Lo our head office, well an aayance of the launch, prefereoly ar.or to final printing of ontry forms or gackaging. Such submissions shuuld be made Lo tr. J, Neviason an supermarket divasion for qupermarker ~to gtions or the anoropriat: buyer, jeneral merchandise division for variety and " mart promozions. / kee hea "7 a a y eur . » HOVAHAN ONR, Marotta thd bok. TTS df biker ar, UEP BET Pet SEPY ECE sen, GENEP AL Ac CHANDISE DLL TU