Freight wars trial judge orders seven to pay $3m

By PAUL PANCKHURST

A High Court judge has ordered seven defendants to pay more than $3 million after finding a conspiracy by employees and a rival company to strip an Auckland business of major customers.

A lawyer in the case, Peter Woods, believed the award was the biggest for a case of the type in New Zealand.

There will be an appeal against the judgment.

In the decision issued last Thursday, Justice John Fogarty, of Christchurch, talked of a "secretive and crafty plan" and then later - after legal action began - a "pattern of concealment", including deletions of emails.

The trial in Auckland and Christchurch included evidence of the rival company issuing cell phones for co-conspirators to stay in touch.

The case arose after three employees - Fraser Brown, Camille Coltman and Karen Griffiths - left an Auckland division of the freight forwarding company Eskimo International Logistics in 2000.

Coltman and Griffiths were account managers and reported to Brown.

The division arranged the export of perishable goods such as meat, flowers, fruit and vegetables by air cargo.

The three staff went to a new company in Auckland called International Cargo Express (Perishables) and Brown became general manager.

Five key customers also went to the new company, although two were later won back.

Justice Fogarty found an unlawful conspiracy by the three staff, Christchurch company International Cargo Express, its Auckland offshoot, and owners David Carville and Dimitrius Stavreff.

The judge ordered those seven defendants to pay $1,578,000 for lost profits and $1,556, 000 to make up for the lower value of the business when it was sold last year to Hellmann Worldwide Logistics.

He is awaiting submissions on interest, costs and whether GST applies.

The plan "depended on ongoing breaches of loyalty by the employee defendants from January 2000 through to at least September 2000".

"The plan relied on Mr Brown's disloyalty during the transition phase," the judge said.

The plaintiff in the case was EIL Brigade Road - the residue after Eskimo sold its assets but retained its rights in the lawsuit.