Australian Court Targets Non-Parties in Landmark Disclosure Case
In all litigation, there is an important distinction between what you know and what you can prove. Evidence is key. But parties rarely start litigation with all the evidence required to prove their case.
The court has many processes that assist parties gather evidence. The most common process is discovery: this can elicit documents held by the other party in the litigation (i.e., in their possession, custody or power). Where important documents are held by someone who is not a party, they can often be obtained via a subpoena. It is, however, notoriously difficult to enforce subpoenas outside Australia.
Sabre Orders: A Solution for Overseas Documents
For documents held by someone who is based overseas and not part of the litigation, the court can make a Sabre order (named after Sabre Corporation Pty Ltd v Russ Kalvin’s Hair Care Company (1993) 46 FCR 428). These orders typically require that a party to the litigation (the “requester”) take all reasonable steps to obtain documents held by another person/entity (the “holder”). In effect, the requester must try to persuade the holder to voluntarily release the documents. Sabre orders can prevent the discovery process being frustrated where documents are held by other members of a corporate group.
Generally, a Sabre order can be made where there is a real likelihood that the holder has the documents and will give the documents to the requester. This requirement creates a significant, practical limitation: Sabre orders are typically only available where the holder’s relationship with the requester will motivate them to disclose their documents. That relationship can be formal (e.g., being part of the same corporate group) or contractual (e.g., distribution arrangement).
Epoch v Katz: Testing the Limits of Sabre Orders
What about documents held by someone overseas who is unrelated to the parties in the litigation? This situation recently arose in The Epoch Holding Group Pty Ltd v Katz (Disclosure of Documents) [2025] FCA 271 (Epoch v Katz), where Needham J addressed the issue by making a Sabre order against someone who is not a party to litigation.
David Katz left his employment with Epoch to join the Schonfeld group of companies. He was initially employed by Schonfeld Strategic Advisors (UK) LPP (Schonfeld UK), before moving to Schonfeld Strategic Advisors (Australia) Pty Ltd (Schonfeld AU). Neither Schonfeld UK nor Schonfeld AU was a party to the litigation. Epoch alleged that Mr Katz had misused its confidential information at Schonfeld and wanted documents from Schonfeld UK, which it believed supported that argument.
Schonfeld UK being a foreign corporation, based outside Australia, made it difficult to enforce an Australian court’s order against it. Epoch’s strategy was to seek a Sabre order against Schonfeld AU that would require it to take all reasonable steps to obtain the documents from Schonfeld UK.
Mr Katz opposed the Sabre order. For its part, Schonfeld AU did not make any submissions on whether the order should be made, and told the court that it would comply with any Sabre order.
The Court’s Decision
Section 23 of the Federal Court of Australia Act 1976 (Cth) is the basis for the court’s power to make a Sabre order. This section gives the court the “power, in relation to matters in which it has jurisdiction, to make orders of such kinds… as the Court thinks appropriate”. Epoch argued that this power is broad and allows orders to be made against non-parties.
Epoch also relied on the earlier case of Kraft Foods Group Brands LLC v Bega Cheese Limited (No 4) [2018] FCA 1055, where O’Callaghan J, having declined to issue a subpoena addressed to a foreign corporation that had not submitted to the Court’s jurisdiction, made a Sabre order requiring a non-party (Mondelez Australia (Foods) Ltd) to try to obtain documents held by that foreign corporation (International Great Brands LLC). Although Mondelez opposed that order, it did not argue that the court had no power to make a Sabre order against a non-party.
Conversely, Mr Katz explicitly made that argument in Epoch v Katz. In support, Mr Katz pointed to the fact that Sabre only states that a court has “power to direct a party to take steps” to obtain documents held by a third party.
Mr Katz also relied on Walker v Newmont Australia Ltd [2010] FCA 298. In this case, Walker sought a Sabre order against a non-party (CIBC Australia) for documents held by a related, overseas company (CIBC WM). Gordon J refused the order because her Honour had instead directly ordered CIMC WM (a foreign corporation which had submitted to the Court’s jurisdiction), to produce the documents via a subpoena. Gordon J also stated that:
“CIBC Australia is not a party to the proceeding and is not the subject of any process (whether by subpoena, application for third party discovery or otherwise) which would make it subject to the jurisdiction of the court. Even if CIBC Australia was subject to the jurisdiction of the court, the best the Applicants could hope for was a Sabre type order or an order requiring it to use its best endeavours to obtain the documents from CIBC WM.”
Gordon J’s decision seems to imply that a Sabre order can only be issued against a party who is somehow part of the litigation.
Needham J agreed with Epoch’s broad interpretation of section 23 and found that it allows the court to make orders against non-parties.
Interestingly, according to Needham J, Schonfeld AU indicating that it would comply with any Sabre order brought it into an equivalent position to (a) Mondelez (which was an intervenor) in Kraft v Bega and (b) CIBC WM (which had consented to Australian court’s jurisdiction) in Walker v Newmont. Those comments raise a question about whether the court would issue a Sabre order against a non-party who had not agreed to comply with the order. However, Needham J’s interpretation of section 23, which was the basis for the decision, did not seem to hinge on Schonfeld AU’s cooperation. Her Honour also explicitly acknowledged that additional steps may be required to compel compliance with the Sabre order since Schonfeld AU was a non-party.
A New Tool in the Evidence Toolkit—But How Sharp Is It?
Epoch v Katz provides another tool for parties to gather the evidence needed to prove their case. However, the utility of this new tool remains to be seen.
Although a requester’s failure to comply with a Sabre order could result in contempt of court proceedings, the order only requires all reasonable steps be taken to obtain the documents from the holder. A Sabre order does not require that the documents are actually obtained.
Where a Sabre order is made against a party to litigation, the holder may voluntarily release the documents because they want to assist their related company with the litigation. It has been suggested that, if the holder refuses to release the documents, the court might infer when deciding the case that those documents would not have benefited the requester. In practice, these inferences rarely determine the outcome of the litigation because they cannot fill gaps in the evidence. But the threat of that inference nonetheless provides some incentive for the holder to release the documents.
In comparison, where a Sabre order is sought against a non-party, no such inferences should be drawn if no documents are produced. Nonetheless, the fact that a request for documents was made pursuant to orders from an Australian court may be enough to persuade many holders to provide the requested documents. The decision in Epoch v Katz thus provides an important opportunity worthy of further exploration.
For more information about this topic or our Wrays Litigation and Dispute Resolution Services please contact the below:
Andrew Mullane
Andrew is a Special Counsel in the Wrays Litigation and Dispute Resolution practice who assists his clients to resolve their contentious intellectual property issues, particularly those relating to patents, designs and confidential information. Andrew has extensive experience with advising and representing clients during negotiations, as well as litigating matters in court and before IP Australia.
Andrew Goatcher
Andrew is a Principal in the Wrays Litigation and Dispute Resolution practice and has more than 30 years’ experience advising and acting in complex commercial litigation, including intellectual property matters. Disputes in which Andrew has advised and acted have included patents, registered designs, trade marks and copyright issues, and disputes involving allegations of misleading and deceptive conduct in breach of the Australian Consumer Law.