Emails and encrypted messages relating to a failed defamation action by former soldier Ben Roberts-Smith have been ordered from Seven and its chairman Kerry Stokes' private investment vehicle, who will also pay for a losing bid to have subpoenas dropped.
Mr Roberts-Smith sued Nine newspapers The Sydney Morning Herald and The Age as well as the Canberra Times over reports that a judge ruled in June painted a "substantially true" image of him as a war criminal involved in four murders while serving in Afghanistan.
He has not been criminally charged and is appealing the judgment that dismissed his defamation action, first launched in 2018.
His former employer Seven Network and its chairman Kerry Stokes' private investment vehicle Australian Capital Equity (ACE) partially funded the defamation case against newspapers published by Fairfax, now owned by the Nine Network, its commercial rival.
Mr Roberts-Smith was loaned money to meet his legal costs, as Seven Network considered there was a strong defence case and the former soldier had been made "a target by our opposition".
It wanted him to "use experienced solicitors and senior counsel - who may be more expensive than you would ordinarily engage as an individual".
The court took more than 100 days to hear the case.
Nine sought the documents to bolster its bid to have Seven and ACE pay for some of the mammoth legal bill of the long-running court case, estimated to exceed $25 million.
It seeks a third-party costs order, arguing Seven and ACE influenced the conduct of the proceedings and had a greater financial interest in the outcome than Mr Roberts-Smith.
The parties appealed against subpoenas they argued were too broad and would capture subjects only tangentially related to proceedings before a full Federal Court hearing last week.
Nine's barrister Nicholas Owens SC said the entire relationship between ACE, Seven and Mr Roberts-Smith needed examining and even only "glancing" references to the case would still inform their case.
Seven and ACE's appeal against the subpoenas was dismissed and they will have to pay Nine's costs for the appeal, Justice Ian Jackman announced on Thursday.
The court said Seven made "misplaced" criticisms of the primary judge's reasoning as inconsistent and did not accept its argument the negotiated terms of the loan agreements and the subjective motivations for them were not relevant to determining a costs order.
"Documents concerning the state of mind of experienced and sophisticated commercial parties will often throw light on the nature and existence of the objective facts," the court's published reasons state.
The subpoenas sought documents including emails, file notes, text messages and encrypted communications between the parties.
Mr Roberts-Smith had agreed to pay indemnity costs from March 2020 after rejecting a settlement offer, however he was on Tuesday ordered to instead pay from August 2018 after a judge ruled he knew a number of the allegations were true when he sued.
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