Packaging giant Amcor Ltd has confirmed a class action claim against the company was filed in the Federal Court on April 11. It confirmed in an announcement to the Australian Stock Exchange that Jarra Creek Central Packing Shed Pty Ltd filed a class action claim in the Federal Court on 11 April 2006 against Amcor Ltd, Amcor Packaging (Australia) Ltd and Fibre Containers (Queensland) Pty Ltd alleging cartel behaviour and seeking declarations, injunctions and unspecified damages.
In its stock exchange statement, Amcor says that as previously announced the Amcor board brought to the attention of the ACCC information that raised concerns about potential breaches of Australian competition law.
"Amcor acted in the public interest by first bringing these issues to the attention of the ACCC and then cooperating in the ACCC’s investigation. Consequently, the ACCC granted Amcor immunity from prosecution.
"The ACCC has instituted proceedings against Visy Industries Limited and two other Visy companies and certain Visy executives in relation to the alleged cartel conduct in the corrugated box industry.
"These proceedings are before the court and no party has tendered any evidence. It will be a matter for the Federal Court to determine whether there has been a breach of any competition law.
"The class action filed in the Federal Court contains allegations only. These are not admissions by any party and evidence will have to be proved in court.
"In general, class actions face great difficulties in the courts. Issues of liability and loss are extremely complex and need to be established as a basis for compensation.
"Should the class action proceed it is likely to take some years. Consequently, it is too early for Amcor to form any view on the outcome of the litigation.
"Amcor made significant changes to its senior management team because of these issues.
"Amcor’s new management team is committed to operating with integrity and in a manner in which its customers can have full trust and confidence."
A former Queensland banana-packer has accused Amcor of overcharging him by up to $500,000 for cardboard boxes, through price-fixing it allegedly operated with Richard Pratt’s Visy Group.
Ian Liddle from Tully in Queensland, is leading a $300 million class action against Amcor through Jarra Creek Central Packing Shed Pty Ltd on behalf of an estimated 17,000 businesses alleged to have fallen victim to the Amcor and Visy cartel.
In a statement of claim filed with the Federal Court in Sydney on April 11, Amcor has been accused of charging customers between eight and 23 per cent more than it should have for cardboard boxes, through co-ordinating price-hikes with rival Visy.
The alleged victims were unable to pass on all of the price increases to customers, and some allegedly had to absorb the full impact of the higher box charges.
Liddle alleges he was overcharged between $190,000 and $548,000 for the $2.4m worth of boxes he bought from Amcor between 2001 and 2004.
It is alleged the amount of overcharging was based on estimates of cardboard production costs, Australia’s ACCC has alleged Visy and Amcor unlawfully co-ordinated four industry-wide price-hikes, while manipulating tenders from customers as big as Nestle, Foster’s, Coca-Cola Amatil and National Foods to engineer price rises.
The ACCC has given Amcor immunity from prosecution in exchange for blowing the whistle on the alleged cartel.
