Tax fight

👋 G’day

Today’s brief:

• Uber’s payroll tax appeal heads to court.

• Oracle battles ATO over $250m dispute.

• Australia’s top firms face multiple lawsuits.

Oh, and Macquarie invests A$8.1bn in AI data centres.

Here’s what you need to know 👇

PRACTICE POINTS

Uber, Oracle tax showdown

• The Fair Work Act’s mid-2024 amendments granted gig economy workers new employee-like rights and protections, putting much of the gig economy debate to bed. But Uber’s ongoing tax dispute over whether its drivers are subject to payroll tax could stir things up again. If Uber loses its initial appeal, the case could land in the High Court, potentially setting a nationwide precedent. However, Holding Redlich’s Dhanushka Jayawardena warns that even if Uber wins, state legislatures might still tweak payroll tax laws to target gig economy operators.

• Oracle is taking the fight to the Federal Court after losing its bid to delay a $250m dispute with the ATO. The case centres on cross-border royalties paid to Oracle Ireland from 2013 to 2018, with the ATO arguing they're subject to withholding tax under the Australia-Ireland tax treaty. Oracle is challenging the decision to block its bid to pause the case while negotiations under the treaty play out. Sydney HSF partner Hugh Paynter leads the charge for Oracle. 

• The Victorian Government is backing major changes to the Victorian security of payment legislation to boost national consistency. The proposed changes will ditch Victoria-specific features like the “excluded amounts” regime, which has historically limited the SOP Act’s use in the state. They'll also introduce elements from other states, including a ban on “unfair” time-bar clauses, axing “reference dates,” and adding a summer blackout period for payment claims.

WORD ON THE STREET

Top firms hit with lawsuits

• Australia’s biggest law firms—Ashurst, Clyde & Co, Dentons, Gadens, HWL Ebsworth, and Slater & Gordon—were named in at least 12 new lawsuits last year. Most came from clients, with a couple alleging workplace breaches. There were also three class actions, including one over the HWL Ebsworth data breach.

• PwC heavyweight Rob Silverwood is calling time after 26 years, stepping down from the management team with plans to retire from the partnership by June 2025. The advisory co-lead and 13-year partner is rumoured to be plotting a new course—a BGH Capital-backed M&A spin-off reportedly involving 12+ PwC dealmakers. 👀

• Amber Matthews and Shane Bilardi, DLA Piper’s managing partner and corporate partner, are tackling a major challenge for big law firms: staying competitive in an overcrowded market. Their solution? Double down on what they do best with the mantra: “Doing less is better”.

• K&L Gates has snapped up former Corrs IP litigator Rachelle Downie as a partner in its Melbourne office. Downie brings her expertise in high-stakes patent battles, focusing on pharma and biotech clients.

TALKING POINTS

Aussie firms reach US billing targets

• Aussie billing targets are inching closer to US levels, with juniors under pressure not just to hit their targets, but to avoid logging time if a matter’s running over budget. Most firms expect at least 7 billable hours a day, which often translates to 10 hours of work once you factor in breaks and non-billable tasks. Ashurst targets 1,750 billable hours a year, while top US firms regularly hit 2,000+.

• Get the Zuck out. CEO Mark Zuckerberg has decided to “move out low performers.” According to an internal memo, Meta will cut ~5% of staff (about 3,600 employees) through performance-based terminations.

• The Fair Work Commission has ordered the University of Melbourne to reinstate an academic who was fired for allegedly harassing a female colleague—including, notably, professing his love for her over dinner.

• The LA fires are set to cost over US$20bn (A$32bn), and experts warn California’s insurance crisis could push Aussie premiums higher. With global insured losses exceeding US$100bn ($A161bn) for 6 of the past 7 years, reinsurance costs surged to 20-year highs last year—meaning premiums will probably continue to increase.

TREASURY

DEAL ROOM

TikTok's future: Musk or nothing?

• With a potential US ban on TikTok looming, Chinese officials are reportedly considering selling the social media giant to none other than Elon Musk. One scenario sees X taking control of TikTok US and running the business with China.

• Macquarie Asset Management is pumping up to US$5bn (A$8.1bn) into Applied Digital’s AI-focused data centres, snapping up a 15% stake. The move makes Macquarie the NASDAQ-listed company’s biggest shareholder, according to LSEG data. The deal includes a right for Applied Digital to buy back the stake.

• AVJennings (ASX: AVJ) announced it received a competing proposal from Ho Bee Land Limited for all of its shares for $0.70 per share via a scheme. AV Jennings agreed an exclusivity arrangement with Proprium Capital and AVID Property Group over their acquisition proposal at $0.67 per share.

• Private equity is hitting the gas on car leasing. IFM Investors has snapped up 49% of Splend Group—a booming rideshare financier valued at $200m—backed by co-investors like HESTA. Founder Chris King retains 40% ownership. Splend, offering bundled car subscription plans for rideshare drivers, including EV options, has grown its topline by 60% annually and is targeting 10,000 vehicles by year-end.

• Utah-based bakery franchise Crumbl is exploring a sale that could value the cookie chain at nearly US$2bn (A$3.2bn), debt included. The owners are aiming for a valuation of more than 10x the chain's EBITDA.

SECTOR SPECIFIC

Apple faces $3bn class action

🚜 DIGGERS

• Global Lithium’s chairman and director are gearing up to block Dianmin Chen’s bid for board control at February’s AGM. The drama’s been simmering since mid-2024, when minority shareholder Sincerity Development, led by Chinese-born Liaoliang Zhu, tried to oust two directors.

• Britain will sign a minerals partnership with Saudi Arabia to secure critical resources like copper, lithium, and nickel, supporting local supply chains. Saudi, which estimates the value of its untapped mineral resources at $2.5tn, aims to become a global hub for mineral trade.

• Rinehart-backed Arafura Rare Earths just scored a $200m equity stake from Australia’s National Reconstruction Fund to kickstart a new mine and processing plant. It’s part of the West’s push to shore up critical supply chains and reduce reliance on China.

🏦 FIN

• JPMorgan Chase taps Jennifer Piepszak as its new COO, succeeding Daniel Pinto, who will retire in 2026. Piepszak has ruled out a CEO bid, leaving room for ongoing speculation about Jamie Dimon's eventual successor.

• Bitcoin could soar to US$250k (A$402k) this year, fueled by expectations of favourable cryptocurrency policies under the incoming Trump administration.

📱 TECH & MEDIA

• Apple’s in hot water with a class action alleging it’s abused its dominant position by charging app developers an unfair 30% commission through the App Store—costing British consumers up to £1.5bn (A$3bn). The suit is for ~20m iPhone and iPad users across the UK.

• Angelo Pandeli, the Australian leader of the Hells Angels motorcycle club, has filed a defamation lawsuit against three News Corp Australian subsidiaries in the Federal Court. The case, the first high-profile defamation action in 2025, stems from media reports about his deportation from Dubai.

• TPG’s throwing shade at Labor’s $3bn NBN investment, calling it unnecessary as competition from alternative technologies like 5G and satellite internet is already growing. It says the cash should instead go to areas with limited broadband options.

🏡 RETAIL & REAL ESTATE

• Pfizer is going all-in on its experimental obesity drug, testing multiple doses of its once-a-day weight loss pill to offer a more convenient alternative to injectables. No wonder Pfizer’s doubling down—analysts predict the weight loss drug market could hit $150bn in annual sales by the early 2030s.

• American burger chain Wendy’s is making a comeback Down Under, opening its first Aussie store in nearly 40 years. With this move, it’s set to become a serious contender to the fast-food giants, including McDonald’s.

P.S.

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