The High Court has refused an application by Denis O’Brien for two corporate plaintiffs to provide security for his costs in proceedings over the award of Ireland’s second GSM mobile telephone licence.
The application concerned Comcast International Holdings Incorporated and Ganley International Limited. Mr O’Brien argued that both companies were outside the State, had few or no assets and were unlikely to pay costs if they lost. The court accepted, for the purposes of the application, that the companies were unlikely to meet a costs award.
The plaintiffs allege that the tender process was interfered with and that the licence was unlawfully awarded to ESAT Digifone. Those are allegations in the proceedings, not findings made in this ruling. Mr O’Brien denies the allegations. The judge found that, in the unusual circumstances of the dispute, the requirement to show a defence on the merits was met, despite criticism that Mr O’Brien’s affidavit stated his defence in general terms.
The court rejected the plaintiffs’ argument that their inability to pay had been caused by the alleged wrongdoing. It said they could not establish for this application that their consortium would have won the licence, and that a possible loss of the chance to win did not show that the alleged wrongdoing had left the companies unable to provide security. The judge also rejected delay as a reason to refuse the application.
A decisive factor was Mr Ganley’s continued presence as an individual co-plaintiff. The judge said his asserted ability to meet a costs order had not been challenged by affidavit and was sufficiently established for this application. That protection could change if Mr Ganley ceased to be a plaintiff, the judgment said, in which case an application could be renewed.
The judge also relied on the public interest in having the controversy determined in court. The ruling addressed the counterclaim as well: if security had been ordered, the judge said he would have required an undertaking not to pursue the counterclaim against a party unable to continue its claim because it could not provide security.
The court therefore refused the application for security for costs. It did not determine the underlying claims about the licence award. GCI Limited, which had been dissolved in 2003, was agreed to be struck out without further order.