Taylor v Telstra Corporation Ltd [2007] FCA 2008

FEDERAL COURT OF AUSTRALIA

Taylor v Telstra Corporation Ltd [2007] FCA 2008 PRACTICE AND PROCEDURE – representative proceeding – Court approval of settlement – fairness and reasonableness of terms of settlement – objections to settlement – alternative outcomes – independent assessment of reasonableness of legal fees – exclusion of certain group members from settlement

Federal Court of Australia Act 1976 (Cth), ss 33V, 33X Corporations Act, s 674

Australian Competition and Consumer Commission v Chats House Investments Pty Ltd (1996) 142 ALR 177referred to Courtney v Medtel Pty Ltd (No. 5) 212 ALR 311 referred to Darwalla Milling Co Pty Ltd v F Hoffmann-La Roche Ltd (No. 2) (2007) 236 ALR 322 applied Haslam v Money for Living (Aust) Pty Ltd (Administrators Appointed) [2007] FCA 897 referred to Lopez v Starworld Enterprises Pty Ltd [1999] FCA104 referred to Williams v FAI Home Security Pty Ltd (No. 4) (2001) 180 ALR 459 applied ANDREW TAYLOR v TELSTRA CORPORATION LTD (ACN 051 775 556) NSD 89 OF 2006

JACOBSON J

13 DECEMBER 2007

SYDNEY IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD 89 OF 2006

BETWEEN: ANDREW TAYLOR

Applicant

AND: TELSTRA CORPORATION LTD (ACN 051 775 556)

Respondent

JUDGE: JACOBSON J

DATE OF ORDER: 13 DECEMBER 2007

WHERE MADE: SYDNEY

THE COURT ORDERS THAT:

1. Order 3 of the four paragraph set of orders made on 12 November 2007 be varied to exclude [26], [28] and [29] of the Confidential Affidavit of Kenneth John Fowlie sworn 9 November 2007. 2. Pursuant to s 33V of the Federal Court of Australia Act 1976 (Cth) (the Act), the Court hereby approves the settlement of this Proceeding in accordance with the terms of the Deed of Settlement, a copy of which is Annexure 'A' to these Orders (the Deed of Settlement)*. 3. The Applicant's solicitors will cause a notice in the form of Annexure 'B' to these Orders (the Notice)* to be sent by email or by pre-paid post to the last known address of each person who has retained the Applicant's solicitors in the Proceeding by no later than 24 December 2007. 4. The Applicant's solicitors will cause the Notice to be published in the legal notices section or the equivalent of: (a) The Australian Financial Review; (b) The Australian; (c) The Sydney Morning Herald; (d) The Age; (e) The Courier Mail; (f) The Advertiser; (g) The Hobart Mercury; (h) The West Australian; (i) The Northern Territory News; and (j) The Canberra Times by no later than 24 December 2007. 5. The cost of complying with Orders 3 and 4 be paid by the Applicant and then be part of his costs in the cause. 6. All costs orders made to date in the Proceeding are hereby vacated. 7. There will be no order as to the costs of the Proceeding. 8. Pursuant to s 33ZF of the Act or otherwise, the Court authorises the Applicant nunc pro tunc on behalf of the group members described in Order 9 to enter into and to give effect to the Deed of Settlement and the transactions thereby contemplated for and on behalf of those group members. 9. Pursuant to s 33ZB(a) of the Act, the Court declares that the persons affected and bound by these orders are the Applicant, the Respondent, and the group members who are defined in the Second Further Amended Statement of Claim filed on 3 November 2006 as follows: persons who purchased shares in the Respondent between 11 August and 6 September 2005 (inclusive), and who: (a) did so in the belief that the price at which they were purchasing the shares was not falsely inflated by reason of any non-disclosure by the Respondent to the market of material information; (b) did not, on or before 6 September 2005, resell those shares at a price equal to or greater than that for which they had purchased them; and (c) thereby suffered loss, save for those group members who have opted out of the representative proceeding pursuant to notices filed with the Court pursuant to s 33J of the Act. 10. The Second Further Amended Application filed on 3 November 2006 be dismissed and judgment entered for the Respondent. 11. Pursuant to s 50 of the Act that the Applicant's Confidential Submissions dated 11 December 2007 (Confidential Submissions) not be published to any person without further order of the Court. 12. That the Confidential Submissions be sealed on the Court file and not be disclosed to any person without further order of the Court. 13. Pursuant to s50 of the Act that [4] of the affidavit of Jason Lawrence Betts sworn 12 December 2007 and exhibit "JLB-1" to that affidavit, and [5] and [6] of the affidavit of Jason Lawrence Betts sworn 13 December 2007 and exhibit "JLB-1" to that affidavit (the Affidavits) not be published to any person without further order of the Court. 14. That the Affidavits be sealed on the Court file and not be disclosed to any person without further order of the Court. 15. Slater & Gordon may approach the Court, after giving at least 7 days' notice to the Respondent, to seek an extension of time from the Court to complete any of the steps provided for in the Settlement Scheme, being Schedule 1 to the Deed of Settlement. * Annexures A and B referred to in these orders have not been set out in full; copies have been kept with the papers. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA