R v Kerr

• Jurisdiction: New Zealand
• Judge: Venning J
• Judgment Date: 23 March 2016
• Neutral Citation: [2016] NZHC 512
• Docket Number: CRI-2015-092-11253
• Court: High Court
• Date: 23 March 2016

The Queen

and

Jeremy Hamish Kerr

[2016] NZHC 512

CRI-2015-092-11253

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

Sentencing following guilty pleas to two counts of blackmail — the maximum penalty in each case was 14 years’ imprisonment — the offender wrote to a dairy company and farmers and threatened to put 1080 poison in infant milk formula and other products in the Chinese market if pressure was not brought to bear on the Government to stop 1080's use — the threat was not carried through and the offender attempted to revoke it — the estimated cost to all affected parties was in excess of $32 million — the offender received royalties from the manufacture and sale of a competing product and the Court had found that he was in part motivated by financial factors — what factors were relevant to fixing the starting point for blackmail of this kind —whether a minimum period of imprisonment was required.

Counsel:

C Gordon QC for Crown

J Billington QC and H M Ford for Defendant

SENTENCING NOTES OF Venning J

1 Jeremy Hamish Kerr you are for sentence in this Court having pleaded guilty to two counts of blackmail. The maximum penalty in each case is 14 years' imprisonment.

2 On or about 26 November 2014 you sent two blackmail letters, one to the Chief Executive Officer of Fonterra and one to the Chief Executive Officer of Federated Farmers. The letters referenced sodium fluoroacetate (1080) and stated:

Enclosed is a sample of 1080 blended with New Zealand dairy infant formula currently in China

If after the 27 ^th March 2015 this VTA is still in use in New Zealand

Several New Zealand infant and other formula will be released into the retail chain in the Chinese market and one other market with traces of 1080.

The release will coincide with a media package supplied to the Chinese authorities and competitors highlighting the risk to [New Zealand] their environment and others consuming our export products from exposure to 1080, and current NZ Government agency policy and practice with 1080

A concurrent media release in NZ and China will expose the past 30 years of flawed self serving science and bureaucracy that has allowed the Government sanctioned approvals to continue.

Our group has no confidence in the political or democratic process concerning 1080.

It is for you to manage the outcome.

This notice is private and confidential to you and will [remain] as such. If there is no compliance it will form part of the media release.

The magnitude of this issue is now beyond the temporay [sic] financial and personal sacrifice that will be made by the agricultural and tourism sectors of the New Zealand economy.

3 Enclosed with the letters in each case was a small, self sealing plastic bag containing a sample of infant formula contaminated with 1080. The collective volume of the 1080 if ingested was sufficient to prove fatal to between 13 and 33 infants.

4 The blackmail threats were reported to the police. Following a preliminary assessment a serious crime investigation was commenced.

5 The investigation represented a major undertaking for police over a period of 10 months and involved at times 35 investigators and analysts. In addition, additional resources were seconded from other departments from time to time, particularly the Ministry of Primary Industries. Police were involved in assessing approximately 2600individuals who had in some way voiced opposition to or expressed strong views concerning the use of 1080 as a pest control agent. The police also investigated persons who had had access to 1080.

6 The investigation involved in excess of 30000investigator and analytical man hours at a cost of more than $4 million.

7 The trigger date of 27 March 2015 passed without event. The threat was not actioned. The police investigation continued.

8 In the course of the investigation you were spoken to by Detective de Villiers on 27 June 2015. You provided DNA and fingerprint samples and allowed the police to conduct a cursory examination of your laptop.

9 You had had access to 1080 for research purposes, which is why you were spoken to. In 1995, through Feral IP Limited you had developed and registered a cyanide based product, Feratox, a VTA normally used in conjunction with ground based trapping. From 1981 on entities that you have been involved with had developed further ranges of pest control products specifically to reduce the population of possums, rats, stoats and other rodents.

10 You received royalty fees from sales of Feratox. Over the 13 year period to March 2015 you had earned an average of $135000approximately from the royalty fees. Over the last five years prior to and including March 2015, however, the average royalties had reduced to just over $101000 per annum.

11 The Crown argue your offending was financially motivated. You denied that. A disputed fact hearing was held. Evidence was called by the Crown from a number of witnesses who had business dealings with you. Detective Beswick gave evidence of the financial pressure you were under in late 2014. You called evidence from Mr

Hussey who analysed your financial position at the time. Your son Mike also gave evidence. At the conclusion of the evidence this Court found as proved beyond reasonable doubt that at the time you wrote the blackmail letters in November 2014:

• (a) you were under considerable financial pressure;

• (b) you knew there would be some financial benefit to you if 1080 was banned on the basis that there would be a modest uplift in sales of Feratox;

• (c) when you wrote the blackmail letters you were motivated in doing so by the fact you would benefit financially if 1080 was banned although you did not know how much exactly the financial benefit would be; and

• (d) while there may have been other reasons behind your writing the letters in writing them you intended to obtain some financial benefit for yourself.

12 After Detective de Villiers had visited you, you decided to write to him anonymously claiming that there never had been a threat made to New Zealanders and that the purpose of the blackmail letter was to show what damage would be caused to the New Zealand dairy product export market to China if products became contaminated with 1080.

13 On 2 July 2015 you travelled to Marton and on 3 July 2015 drafted a retraction letter addressed to Detective de Villiers. You were unable to print it but you then later used your own laptop to recreate the letter and label which was successfully printed.

14 You posted the retraction letter to Detective de Villiers at the Gore Police Station where he was based, on 3 July 2015 from the Wellington area. After the letter was received both it and the envelope were analysed.

15 An analysis of the DNA profile on the envelope showed it was 260 times more likely to be your DNA rather than a random male sourced from the general New Zealand population (not excluding paternal male relatives). A number of search warrants were obtained and executed at premises associated with you. You were interviewed on 13 October 2015. Initially you denied any knowledge of the blackmail threat during the course of that interview and you denied also any knowledge of the anonymous retraction letter. As the interview progressed and the evidence was put to you, you first admitted you sent the retraction letter and then subsequently also admitted that you had written the blackmail letters. You denied there was any financial motivation in doing so and when arrested at the conclusion of the interview you said you were sorry and regretful.

16 Mr Kerr you are 60 years old. Prior to this offending you were a successful businessman, although as I have found in the disputed fact hearing, you were under financial pressure, particularly because of your involvement and your commitment to another company, Natures Support and the venture associated with it.

17 You lost your wife of 30 years in 2011 after being her primary caregiver for four years while she suffered from cancer. You have two adult sons who maintain their support for you. Counsel has presented other letters that have been written in your support. The pre-sentence report writer has said that when your offending was described to you, you said you felt sick. You accepted you had put many people through so much and you acknowledge people may have lost jobs because of you. You repeated, however, you said you felt frustrated by the situation in relation to the use of 1080. You said you had no ill intent when making the threats but acknowledged the impact of them. You said you did not consider your threats would be taken seriously and repeatedly said you had no intention to carry out them out. You were unable to say why you had referred to the Chinese market. You went on to tell the report writer that shortly after writing the letters you wished you could fix it but didn't know how to.

18 The sentence I impose on you must:

• (a) hold you accountable for the harm done to the victims, Fonterra and Federated Farmers in particular, but also other businesses and the wider community;

• (b) promote a sense of responsibility in you for that harm; and

• (c) importantly denounce your conduct and deter not only you but also others from committing similar serious offending.

19 I am obliged to take into account the gravity of the offending, including your culpability. The seriousness of the offence is marked by the 14 year maximum penalty fixed by Parliament for the offence.

20 I am also required to take into account the effect of the offending on the victims. In this case both Fonterra and Federated Farmers have provided victim impact statements setting out the financial effect on them. Fonterra says it has lost in excess of $20 million, in the case of Federated Farmers over a $100,000. Even though the charges are framed as a threat to endanger the safety of infants who might have digested the dairy...