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AN ENGINEERING company has been fined £125,000 and is likely to face more than £1m costs for deliberately trying to hide confidential documents during a court-ordered search by Linklaters & Paines.
The High Court held the company, steel mill producer VAI Industries (UK), in contempt last month after Linklaters' lawyers arrived at its headquarters to execute an Anton Piller order to find staff shredding and attempting to hide documents.
The dispute between VAI Industries, advised by Travers Smith Braithwaite, and Linklaters' clients Davy International (now Kvaerner Metals) was sparked off when VAI took on many of its rival's former staff when it launched at the end of 1995.
Davy believed staff had taken some of its documents and computer disks to VAI and in May last year obtained an Anton Piller order allowing it to search VAI's premises and retrieve any such documents.
Linklaters assistant Tom Lidstrom led a team of lawyers to VAI's headquarters in Poole to serve the order and search the premises for documents. They took away 2,700 documents plus a bag of shredded paper amongst which the Linklaters lawyers saw Davy's logos.
VAI claimed the shredded documents were its own, but Linklaters obtained an order to have the shredded paper re-constituted at a specialist laboratory. This revealed that 10 per cent of the shredded documents were Davy's.
Linklaters' next step was to issue proceedings against VAI for contempt of the Anton Piller order which it did last December. It claimed that, on the morning of the raid, VAI chief executive Roy Tazzyman had issued instructions to staff he met in the company car park to hide, destroy or take away documents.
Tazzyman's affidavits, sent in reply to Davy's proceedings, claimed that he had arrived at the office car park and, on being told that there was a raid in progress, had driven off and spent the next few hours on his mobile phone.
At the High Court, Mr Justice May held VAI in "contumacious" (deliberate) contempt, saying that Tazzyman had told "conscious untruths" in his affidavit and that he was the "agent of intentional disobedience of the Anton Piller order".
The judge added: "This was serious, intentional and continuing flouting of a court order. The message has to go out that court orders are to be obeyed."
Contempt proceedings against Herbert Durnig, an Austrian director of VAI, also represented by Travers Smith, were dismissed. Titmuss Sainer Dechert represented two VAI employees, John Molero and Graham West. The former was acquitted and the latter convicted of contempt.
After the hearing, Lidstrom said that while his team had been searching VAI's premises its employees were "running around putting things in toilets and in cars". He added that documents were even discovered behind ceiling tiles.