A “centrally relevant” witness in a multimillion-dollar cartel conduct case against Moses and Paul Obeid and Sydney businessmen John McGuigan and Richard Poole has vanished overseas, the Federal Court has heard.
The hearing of the cartel conduct case, launched by the Australian Competition and Consumer Commission last year, kicked off on Monday with allegations the Obeids received “substantial benefits” including $28 million in cash for rigging a NSW government tender for two lucrative coal exploration licences.
One of the licences was over Cherrydale Park, the Obeid family’s farm at Mount Penny in the Bylong Valley.
The court heard an alleged Obeid frontman, Andrew Kaidbay, left the country last year and “attempts to locate him haven’t been successful”.
Mr Poole’s barrister, Luke Livingston, said Mr Kaidbay was a “centrally relevant figure” in the case and it was vital that he be cross-examined in court.
He said the ACCC had “failed to demonstrate it has taken all reasonable steps to secure Mr Kaidbay’s attendance”, given it was aware that he left the country last year and there was a “real risk Mr Kaidbay would not be a cooperative witness”.
Counsel for the ACCC, Cameron Moore, SC, hit back: “The suggestion that we sat on our hands and allowed him to flee the country is simply [incorrect], Your Honour.”
The ACCC is taking civil action for alleged cartel conduct against Moses and Paul Obeid, two of former NSW Labor minister Eddie Obeid’s five sons, for striking an alleged deal with Cascade Coal to withdraw a rival bid for the exploration licences to clear the way for Cascade to emerge the winner.
In exchange, Cascade allegedly agreed to give the Obeids a 25 per cent stake in a mining venture and to buy Cherrydale Park and neighbouring properties owned by Obeid associates for four times their value. At the time of the alleged deal, Mr Obeid snr was a member of the NSW upper house.
The ACCC is also pursuing Cascade Coal, which ultimately won the licences, and two of its founding investors, Mr McGuigan and Mr Poole.
Mr McGuigan’s son James, who was an employee of Cascade Coal, is also in the ACCC’s sights. All of the respondents deny any wrongdoing.
In his opening address on Monday, Mr Moore said the Obeids received “substantial benefits … including cash in the order of $28 million” when the rival bids were withdrawn by Monaro Coal, a company that had been acquired by the Obeids during the tender process in 2009 and renamed Loyal Coal.
Monaro Coal had been regarded as the favourite to win the licences by a substantial margin.
The ACCC is seeking monetary penalties and costs as well as orders that the men be disqualified from managing companies for a set time. It has not launched a criminal prosecution.