Witness credibility concerns aired in Cascade Coal suppression bid
Competition & Consumer Protection July 13, 2018 4:03 pm By Miklos Bolza | Sydney

The credibility of a witness in the ACCC’s dismissed cartel case against Cascade Coal may prejudice an upcoming criminal trial against the son of former NSW Labor minister Eddie Obeid, a court was told Friday.

In a Federal Court hearing over arguments for extending an interim suppression and non-publication order on the judgment throwing out the action, Moses Obeid’s barrister Arjun Chhabra said the credibility of the unidentified witness could “form the backbone” of the trial over Obeid’s involvement in a $30 million coal deal, to be heard next year in the NSW Supreme Court.

Obeid, one of several respondents in the ACCC’s case, secured a temporary suppression order on July 6, just after Justice Lindsay Foster said he dismissed the ACCC’s application but just before he delivered reasons for his judgement.

ACCC barrister, Michael O’Meara, said Friday that while the commission did not oppose the suppression bid, it questioned the need to redact all 48 paragraphs highlighted by Obeid as prejudicial.

“A judgment published in that form will materially affect the capacity of it to be read by the public,” he told the court. “In relation to some of the paragraphs, it’s very difficult to see on their face how they would be the subject of a non-publication order.”

Judge Foster agreed, and ordered Obeid to “narrow the focus” of his application. The courr set down August 10 for another hearing on the suppression order. The ACCC has until August 3 to appeal the judge’s ruling in the case.

The commission filed its originating application commencing proceedings in May 2015, claiming Cascade Coal and Loyal Coal entered into an agreement with each other in the 2009 tender process for exploration licences over the Mount Penny and Glendon Brook coal tenements in the Bylong Valley, NSW.

The regulator alleges that Loyal Coal, which was majority owned by Moses Obeid and his brother Paul Obeid, agreed to withdraw from the tender process in return for Cascade granting one of Loyal’s affiliate companies, Buffalo, a 25% interest in its mining venture. Cascade also promised to purchase land in the coal release area from owners who were represented by the Obeids for four times the lands’ value.

Cascade ended up winning the tender for both coal release areas.

The ACCC also claims that in 2010, Buffalo transferred its 25% ownership to Southeast Investments, also associated with the Obeids. Southeast later sold the interest to Coal & Minerals Group, a firm associated with Cascade. As a result of these transactions, Southeast Investments received benefits worth $60 million, including $30 million in cash which was distributed to Paul and Moses Obeid, one of their family trusts, and their families.

In April 2016, Loyal admitted to breaching competition law and resolved the court proceedings. The settlement amount remains confidential.

The ACCC is also pursuing proceedings against John McGuigan, director of Cascade; Richard Poole, a former director of Cascade; and James McGuigan, a representative of Cascade, as well as Locaway, Mincorp Investments, and Southeast Investment Group, companies that are all associated with the Obeids.

Moses Obeid is represented by Hanna Legal in the Federal Court case. The ACCC is represented by the Australian Government Solicitor.

Chhabra is from Maurice Byers Chambers. O’Meara is from Sixth Floor Selborne Wentworth.

The case is Australian Competition and Consumer Commission v Cascade Coal Pty Ltd ACN 119 180 620 & Ors.

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Miklos Bolza

Miklos Bolza has been a journalist for three years. He has written for a variety of publications, including NZ Lawyer, HRD Australia, and Australian Broker. He is currently the Sydney court reporter for Lawyerly.