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Leading Australian law firm, Clayton Utz, faces at least two inquiries about its involvement in destroying thousands of sensitive tobacco company documents.

The Australian Competition and Consumer Commission chairman Professor Allan Fels yesterday said the commission would investigate if there had been misleading, deceptive or unconscionable conduct in breach of the Trade Practices Act by Clayton Utz and British American Tobacco Australia Services. “The commission regards this as serious matter,” he said.

The commission was also concerned more generally about companies destroying documents and claims for legal professional privilege that impeded its investigations. Sanctions under the Trade Practices Act included injunctions, court orders, and fines of $1 million for each offence for corporations and $200,000 for individuals.

“We want to make it clear to all businesses in Australia that this case suggests that any document destruction could be unlawful if it is intended to mislead or deceive,” Professor Fels said.

Senior lawyers from Clayton Utz and another big law firm Mallesons Stephen Jaques also face inquiries by legal regulators, most likely to be the New South Wales Legal Services Commissioner or the NSW Law Society.

This week Victorian Supreme Court judge Justice Geoffrey Eames found that by destroying documents Clayton Utz, and British American Tobacco Australia Services had subverted court processes to deny Mrs. McCabe a fair trial. A jury awarded her $700,000 in damages.

Clayton Utz yesterday said it would cooperate in any inquiry and was appealing the Supreme Court’s findings.

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