Courts attempt to untangle Express mess

Just last week the Federal Court in Melbourne finished hearing evidence in the case brought by the Australian Competition and Consumer Commission over equipment leases and agreements with newsagents and other merchants that used the company's service.

The ACCC estimates that, since 2003, up to 4500 merchants entered rental agreements to pay for Bill Express equipment from related party Technology Business International (TBI), which for a long time operated out of the same Eaglemont office as Bill Express.

Indeed, many staff with Bill Express business cards were actually paid by TBI.

In this instance the ACCC alleges that Bill Express demanded that merchants using its payment system lease equipment supplied by TBI, which the regulator claims was a form of exclusive dealing that is prohibited by Section 47 of the Trade Practices Act.

According to the ACCC, it is an example of "third line forcing" when a supplier demands that a customer acquire goods or services of a particular type from a third party that has been nominated by the supplier.

As a result of those rental agreements, about 2800 merchants have lingering contracts to pay rent of about $500 a month on Bill Express terminals that no longer work, as the system was shut down on the day the company went into administration.

The future rent revenues on those machines were, however, sold off by Bill Express in its final months to Bank of New York Trust Company of Australia and Mobius Financial Services.

The ACCC has commenced proceedings against Bank of New York Trust and Mobius it says they were "knowingly concerned in the alleged contraventions of Section 47 of the act".

In addition, the ACCC alleges that, "in the process of signing businesses up as Bill Express merchants, both Bill Express and TBI engaged in false and misleading or deceptive conduct".

The ACCC's case was heard in the Federal Court last week, but the problem is there's just about no one left standing in the matter.

Bill Express, TBI and Mobius are all in liquidation, which makes the Bank of New York Trust the only respondent remaining.

A decision is expected before the end of the year, but that's not where the trouble ends.

As Full Disclosure reported yesterday, the corporate plod has banned a Macquarie Equities adviser in Melbourne from providing financial services for five years, for participating in market manipulation of Bill Express shares.

The Australian Securities and Investments Commission investigated Newton Chan, a senior adviser at Macquarie Equities, and found he used trading accounts to place orders in Bill Express that

"had the effect of creating or maintaining an artificial price for trades in the stock".

ASIC's investigation found that Chan entered false names in Macquarie Equities' electronic ordering system for almost two years, and used trading accounts at Macquarie Equities to place orders in Bill Express shares.

"That had the effect of creating or maintaining an artificial price for trades in the stock," said ASIC.

Full Disclosure also notes that ASIC's investigation into alleged market manipulation of Bill Express shares is "ongoing", and follows a referral from the Australian Securities Exchange, which has made its own inquiries into trading of Bill Express stock before the company's collapse.

Fine family wine

THE Australian wine industry is facing a tough road ahead both at the premium end

of the market, and at the bulk end.

To combat overseas perceptions about Australian wine being cheap and cheerful, 12 leading family-owned wineries have joined forces to form the First Families of Wine.

Brown Brothers, Campbells, d'Arenberg, De Bortoli, Henschke, Howard Park, Jim Barry, McWilliam's, Tahbilk, Taylors, Tyrell's and Yalumba are the labels that comprise the First Family.

Together, they hope to raise both the prestige and the prices paid for premium Australian wines.

Prices in overseas markets have been hit by the global grape glut and bottled bulk wine from Australia.

At that very end of the market from which the First Families are trying to distance themselves, another fight is brewing that also involves a famous Australian wine family.

Casella Wines, owners of the famous [Yellow Tail] brand, has initiated legal proceedings in the US Federal Court in Manhattan against two American wine companies it says have infringed its trademark.

The NSW company, owned by the Casella family, has hired US law firm Blank Rome to represent it in its case against both Bronco Wine and Barrel Ten Quarter Circle which plan to release a chardonnay called [Down Under] that uses both the brackets, and an image of a kangaroo.

Yellow Tail is the market leader in its price range in the US and the brackets around the name, and the use of a yellow-footed rock wallaby for its logo, are part of the company's trademark.

The owners of the Down Under label claim they registered it years ago, before Yellow Tail became a global success.

Casella alleges that the label for Down Under is "substantially similar" to the trademarked label for Yellow Tail. Bronco's use of Casella's iconic square brackets and its use of Australian-centric wording in connection with the sale of Australian wine are likely to confuse consumers, state legal documents filed in the case.

Grubby business

FULL Disclosure likes to keep tabs on just what our business readers are keeping tabs on.

But we were a little perplexed yesterday to note that the top-read story on the BusinessDay website had the headline "Cocaine traces found on 90 per cent of greenbacks", and it attracted 50 per cent more unique readers than the next most-read story, a yarn titled a "RBA flags rate rise".

And we thought it was the hip-pocket nerve that would bring eyeballs to our site.