Telecommunications, Media and Technology

Media

Macquarie Media Group (MMG) - Southern Cross Broadcasting acquisition:  We advised on the A$1.35 billion (approx.) acquisition by Macquarie Media Group (MMG) of Southern Cross Broadcasting Limited (SBC) by scheme of arrangement and, following the completion of the scheme, Fairfax Media's acquisition of Southern Cross' radio business, Southern Star, Satellite Music Australia and other associated businesses.  The transaction established MMG as the most significant combined radio and television broadcasting operator in regional Australia.

This transaction has also involved working closely with regulators on complex and new areas of analysis.  The primary acquisition and secondary on-sale were the first and second cross-media transactions following the 2007 amendments to the Broadcasting Services Act.  It was also the first opportunity for the ACCC to analyse cross-media competition policy in media markets.

Illyria Pty Ltd - Proposed Acquisition of Consolidated Media Holdings:  We advised Lachlan Murdoch's private vehicle Illyria and Consolidated Press Holdings on the proposed acquisition of the assets of Consolidated Media Holdings.

Seven Network - Various matters:  We act for Seven in respect of its acquisition of major sporting rights including Australian Football League and Olympic Games rights.

We also act for Seven on a range of other corporate and commercial matters including Seven's retransmission agreement with Foxtel and advise Seven in relation to its exclusive agreement with TiVO Inc to launch the TiVO DVR (digital video recorder) in Australia.

CanWest Global Communications - Ten Network Holdings:  Clayton Utz previously advised Canadian media company CanWest on structuring its investment in Australian broadcaster The Ten Group Pty Limited. More recently, we acted for CanWest when it sold ordinary shares and convertible debentures of The Ten Group in consideration for the issue of ordinary shares of ASX listed Ten Network Holdings, and thereby took a 56 percent controlling equity stake in Ten Network Holdings, valued at approximately A$1.55 billion.

Telecommunications

Optus:
TERRiA  consortium - NBN bid:  We are currently advising the TERRiA consortium of telecommunications carriers (comprising major Australian fixed line telecommunications carriers other than Telstra (including Optus Networks) in respect of the Government's call for proposals to build and operate a national broadband network.

This is one of the largest and most complex infrastructure projects ever undertaken in Australia. As well as commercial arrangements for the roll-out and operation of the new network, the project necessarily involves facilitating regulatory changes that will change the industry landscape for the future.

High Court constitutional proceedings:  Clayton Utz' litigation team successfully represented our client Optus as one of a number of defendants in a high-profile matter brought by Telstra in the High Court.

The litigation concerned the operation of the access regime in Part XIC of the Trade Practices Act and whether it gave rise to an acquisition of Telstra's property otherwise than on just terms in breach of section 51(xxxi) of the Constitution. Among the defendants were the ACCC and a number of other telecommunications services providers.

In an unanimous judgment handed down on 6 March 2008 the High Court rejected Telstra's arguments that Part XIC effected an acquisition of property as "synthetic and unreal" and saying that Telstra's ownership of the public switched telephone network had always been subject to access regimes.

The decision was particularly gratifying for the Clayton Utz team and Optus as we and our counsel bore the brunt of the legal argument on the constitutional questions.

This decision has provided a measure of regulatory certainty and has important implications for the Government's current call for proposals to build and operate a national broadband network. 

Access proceedings:  We are advising Optus on all aspects of its much publicised and strategically critical disputes with Telstra in relation to local access including for the Unconditioned Local Loop Service (ULLS) , Line Sharing Service (LSS), PSTN origination and termination (PSTN OTA), Local Call Resale (LCR) and Wholesale Line Rental (WLR), including commercial negotiations, arbitrations before the ACCC and appeals before the Australian Competition Tribunal and the Federal Court in respect of final access determinations made by the Australian Competition and Consumer Commission.

Department of Defence:  We are advising in relation to the JP2008 satellite project (currently Phases 3E and 3F, relating to ground station facilities and the upgrade and expansion of Defence's terrestrial capabilities). The proposed contractual arrangements involve a sophisticated performance linked approach to remuneration.

Federal Minister for Communications, Information Technology and the Arts:  Clayton Utz represented Senator Coonan and, since the change of Government, Senator Stephen Conroy as Minister for Broadband, Communications and the Digital Economy, and the Commonwealth in relation to the application for preliminary discovery brought by Telstra in the Federal Court. 

Telstra sought preliminary discovery of a range of documents relating to the Australian Government’s grant of A$958 million in funding to OPEL Networks Pty Limited (a consortium of Optus and Elders) pursuant to the Broadband Connect Infrastructure Program.

Department of Immigration and Citizenship - Telecommunication Outsourcing:  We advised DIAC on its Telecommunication outsourcing initiative. This included working closely with the project team and its external advisors to draft procurement documentation, including RFT documentation and draft conditions of contract (based on the Whole of Government Telecommunications Arrangement head agreement).

In addition, our extensive prior experience in telecommunications outsourcing projects has enabled us to be actively involved in the preparation and refinement of DIAC's requirements for the telecommunications services.
We also assisted in negotiation and finalisation of Contracts with the successful Tenderer.

Technology

NSW Government ERP Acquisition:  We advised on the acquisition of core finance and HR/payroll (ERP) systems from SAP. This involved a complex 15 year licensing and maintenance facility for the whole of government and a major implementation project for the NSW Department of Education and Training.

The contract is one of the largest of its type in the Asia Pacific region and will deliver significant benefits to the NSW Government.

Sharman Networks:  Clayton Utz acted for Sharman Networks (and others) in a dispute with the Australasian Mechanical Copyright Owners' Society (AMCOS), the Australasian Performing Right Association (APRA) and their global affiliates (as representatives of music publishers) concerning allegations of infringement of copyright in musical works arising out of the distribution and use of the KaZaA peer-to-peer file sharing software. The dispute ultimately settled. We were also recently involved in a court application by Merlin, acting on behalf of independent record labels to access the court file from the landmark KaZaA litigation between Sharman (and others) and the major record companies concerning copyright in sound recordings.

We also acted in the KaZaA litigation, which settled in 2006. Merlin is seeking access to the court file as part of an attempt to claim damages on behalf of its members for alleged past infringements.

This was part of a global dispute and was a follow-on from the KaZaA litigation. The matter raised important issues in terms of the liability of the developers and distributors of online technology, where such technology affects the rights of copyright owners.

Attorney-General's Department (NSW):  We are advising the Crown Solicitor's Office on the Justice Link project. This is a centralised online database system that will be used in all NSW courts. Linking all district and local courts and the NSW Police records, the database feature e-filing, case filing, warrants, and transcript request. The New South Wales Courts system is one of the largest in the world providing an integrated administration covering the Supreme, District and Local Courts as well as the Sheriff's Office. The project is groundbreaking and when implemented will revolutionise legal administration in the State of New South Wales.

Myer - POS Project: Following Myer's transition to a private company in 2006, Clayton Utz began acting for Myer advising on a range of IT matters. In mid 2007, Myer commenced one of its most significant IT projects in many years – the replacement of its entire Point of Sale infrastructure and systems across its entire national network of stores the "myPOS" Project. The roll-out of the myPOS solution is a significant logistical and financial undertaking by Myer.

Our role to date in this ongoing project has been extensive, whereby we have advised Myer on all aspects of the myPOS project, including selecting a hardware vendor, software vendor and systems integrator. We have prepared an Master Services Agreement for each role within the myPOS project, have reviewed each of the preferred tender responses and conducted short, sharp negotiations with each of the preferred vendors. We have provided advice to Myer on key areas of liability, indemnity, warranties, delay costs and intellectual property rights and have negotiated the relevant MSAs to make sure that Myer’s interests are adequately protected on each of these key issues and the outcome is obtained without involving unnecessary legal fees or lengthy negotiations. As the project has developed, some roles have changed and we have worked with Myer to adapt the arrangements to reflect these changes.

Confidential client - IT Services Project:  Clayton Utz advised a large Australian company in relation to the outsourcing of certain IT services and back office activities and the upgrade of relevant IT systems. We provided extensive advice to the client as it prepares to tender for this work. The client contemplated a complex arrangement where a third party takes over the client's existing infrastructure, provides system integration services and potentially provides IT outsourcing services to the client on an ongoing basis.

Our role in relation to this project was extensive. We drafted a complex Master Services Agreement which covers a range of possible scenarios, making sure that our client had strong protection in areas such as liability, indemnity, warranties, compliance with project timeframes, co-operation with third parties and remedies for breach. In addition to providing advice on legal risks, we also provided practical advice regarding the tender process, and in particular provided advice on how to manage pre-contractual representations and drafted conditions of tender.