Former INM executives can use documents in data breach cases

Judge rules Gavin O’Reilly and Karl Brophy would almost inevitably get the material following a discovery application

Former INM  chief executive Gavin O’Reilly. He  has secured High Court permission to use materials provided during the appointment of inspectors to INM in any further legal actions he plans in relation to alleged data breaches at the company. Photograph: Eric Luke

Former INM chief executive Gavin O’Reilly. He has secured High Court permission to use materials provided during the appointment of inspectors to INM in any further legal actions he plans in relation to alleged data breaches at the company. Photograph: Eric Luke

 

Former INM chief executive Gavin O’Reilly and former INM executive Karl Brophy can use materials provided to them during a hearing to appoint inspectors to INM for legal action against INM and possibly others, the High Court has ruled.

Both men intend suing INM and perhaps others on grounds including alleged breach of privacy and data-protection rights as a result of an alleged data breach at INM in 2014. Both are concerned their personal data was accessed during that alleged data breach.

They previously got material, including sworn statements from the Office of the Director of Corporate Enforcement (ODCE) and INM executives, on condition those could be used only for the hearing about whether to appoint inspectors. Any additional use of the material required court permission.

The president of the High Court, Mr Justice Peter Kelly, last September granted the ODCE application to appoint two inspectors to INM to investigate matters including the alleged data breach.

When Mr Brophy and Mr O’Reilly applied last month to use the materials for the ODCE application in their intended proceedings against INM, the ODCE did not object, but INM objected for reasons including claims they would get a litigation advantage.

In his judgment on Thursday, Mr Justice Kelly ruled the applicants had shown there were “special circumstances” justifying allowing them to use the material and he was also satisfied that would not cause any injustice to INM.

The applicants had argued the special circumstances included that the material demonstrates prima facie evidence of wrongdoing of a “most unusual and marked kind” sufficient to warrant inspectors being appointed.

The judge set out details concerning the alleged data breach and the concerns of Mr O’Reilly and Mr Brophy in that regard, including claims the alleged searches of the data of 19 persons had no legitimate purpose.

Identity of sources

Mr Brophy, a former journalist and former INM director of corporate affairs between 2011-2012, is among the 19, and is concerned his data included highly sensitive information such as medical, employee, salary and pension records.

He was also concerned the alleged searches may have breached journalistic privilege such as concerning the identity of sources with potential to cause him “enormous damage”.

While Mr O’Reilly is not among the 19 people, he had sworn he believes it is clear from the material disclosed to date he was “personally targeted by the data interrogation”, and said his personal assistant Mandy Scott was among the 19.

Both men have alleged the termination of their employment with INM in 2012 was the result of a long-running power struggle between the company’s two largest shareholders, Mr O’Reilly’s family and businessman Denis O’Brien, the judge said.

Both are also involved with Red Flag Consulting and they, Red Flag and others are being sued for alleged defamation and conspiracy by Mr O’Brien, the judge noted.

The ODCE has suggested that Leslie Buckley, non-executive INM chairman between 2012 and 2018, and companies owned by Mr O’Brien, were heavily involved in the alleged data breach, he further noted. That was denied.

Background

He said both applicants had said all of this has no bearing on their application to use the documents but should be seen as background for their intended actions alleging breach of privacy, data-privacy rights, constitutional rights and alleging they have suffered loss and damage.

It is not disputed the applicants already have the documents at issue, and he could not agree with INM’s argument the relief being sought by them was “unduly wide” as they had identified they wanted to use the documents for their legal actions.

Because the material already provided to them was given with the consent of INM, there could be no breach of section 790 of the Companies Act precluding disclosure of certain material without the company’s consent.

He said if he refused this application the applicants would almost inevitably have to seek discovery of material they already have, which would be a waste of the court’s time and resources and delay the litigation.

He rejected further arguments that allowing them use the material would give them an improper litigation advantage. The applicants already know what is in the documents and there was no issue of “fishing” for additional information to support their case.

He held they had made out special circumstances for the order and there was no injustice or disadvantage to INM in making it.