7-Eleven has lost its bid to use a confidential bulletin sent to class members via WhatsApp as defence evidence in an ongoing franchisee class action, with a judge rejecting the company’s claims the document was no longer shielded by legal professional privilege.
Federal Court Justice Bernard Murphy issued his order Friday barring the convenience store chain from the bulletin, saying 7-Eleven’s argument that privileged had been waived by a single group member was “remarkable”.
The class action against 7-Eleven was filed by Levitt Robinson Solicitors on behalf of 500-odd franchisees that accuse the franchisor of breach of contract, misleading and deceptive conduct, and unconscionable conduct that has kept franchisees from making a profit.
The confidential bulletin was sent to group members by Levitt Robinson. One member then sent it to a WhatsApp group of about 250 people, only some of whom were class participants, a move 7-Eleven’s barrister, Christopher Archibald, claimed stripped the document of privilege.
Not only did the members of the WhatsApp group contain individuals who were not clients of Levitt Robinson, but the document itself was not legal advice, he told Judge Murphy.
Stewart Levitt, named partner at Levitt Robertson, had also waived privilege by discussing the bulletin through correspondence with 7-Eleven in a manner that “crossed the rubicon,” Archibald said.
Barrister Guy Donnellan, acting for the class, argued 7-Eleven had only “hearsay evidence” from an anonymous source for its claim that the WhatsApp message was sent to non-client parties.
At any rate, the bulletin itself was clearly marked with language that included “privilege, privacy and confidentiality” when sent to group members and through Levitt’s correspondence with 7-Eleven, he said.
Donnellan also argued that joint privilege attached to the document and could be waived by the group only after consensus of the whole.
Judge Murphy agreed with the class, saying 7-Eleven’s argument that one group member could waive privilege for the whole was a “remarkable proposition.”
7-Eleven is barred from producing the bulletin at trial or referring to information in the document in submissions to the court, or elsewhere. All records relating to the bulletin would be removed from the court file, Judge Murphy ruled.
The class action has also named as respondents Texas-based 7-Eleven Inc., as the master franchisor, and ANZ Banking Group, which group members allege breached responsible lending obligations and the Code of Banking Practice when lending to franchisees. Neither appeared at Friday’s hearing.
Donnellan, of Level 22 Chambers, was instructed by Levitt Robertson. Archibald, of Ninian Stephen Chambers, was instructed by Norton Rose Fulbright.
Orders from today’s hearing relate to two class actions against 7-Eleven launched in February. The first is Davaria Pty Limited v 7-Eleven Stores Pty Ltd & Ors which defines its group members as franchisees. The second action is Pareshkumar Davaria & Anor v 7-Eleven Stores Pty Limited & Anor, which encompasses a broader class member definition that includes franchise principles and guarantors.
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