Canberra prosecutors will drop a blackmail charge against construction union organiser John Lomax, in an embarrassing twist in one of the highest profile cases emerging from the trade union royal commission.
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The Office of ACT Director of Public Prosecutions has written to defence lawyers to notify of their intention to offer no evidence against Mr Lomax when he next appears in court.
The Construction, Forestry, Mining and Energy Union said the defence would seek costs and indicated Mr Lomax could sue for wrongful arrest.
Mr Lomax – a former international rugby league representative – declined an interview, but is expected to address the media after the charges are withdrawn in the ACT Magistrates Court on October 19.
Mr Lomax - who was charged with one count of blackmail by police attached to the royal commission - was the prized scalp in a number of high-profile arrests during Canberra sittings in July.
Police alleged that he forced a Canberra painting company, Nel Trading, and its principal, Woong Yul Park, to sign a union enterprise bargaining agreement in April last year.
The owner allegedly believed he would be blocked from working in the ACT and NSW if he did not sign.
The case alleged the owner suffered a financial loss as a result because the EBA required him to pay his workers $26 an hour, when he claims he could have paid as low as $17.
In August, Mr Lomax entered pleas of not guilty before Special Magistrate Maria Doogan, maintaining that negotiating better pay and conditions for workers was not a crime
His lawyer, John Agius, SC, told the court on that occasion that key elements of the offence of blackmail had not been covered in a police statement of facts setting out the allegations.
Outside court, the silk said he had written to the ACT DPP to invite them to withdraw the charge on the grounds the case "is doomed to fail".
ACT Director of Public Prosecutions Jon White confirmed his office would discontinue the prosecution against Mr Lomax, but did not provide reasons for the decision.
CFMEU national construction secretary Dave Noonan said Mr Lomax had been relieved by the news.
"But he was always steadfast in his belief that he did nothing wrong," Mr Noonan said.
"I think it's highly likely that his lawyers will be seeking orders as to costs … and will look at what options are open to address the damage that has been done.
"Mr Agius said inside and outside court that the case was hopeless and what the AFP have done in this matter is wasted an enormous amount of public money, but more particularly have caused damage to Mr Lomax's reputation and smeared him in the eyes of the public."
Mr Noonan called on the Federal Police to answer questions about Mr Lomax's arrest and charging.
"I'd like to know why they have proceeded this way in a case that was hopeless and could not be proved?
"The use of criminal law to smear Mr Lomax and his union is a new low.
"We're very concerned to ensure that the AFP and other police bodies not become enmeshed in politics."
Mr Lomax was one of three high profile arrests during the Canberra TURC sittings.
Former CFMEU organiser Halafihi "Fihi" Kivalu – who has pleaded not guilty to two charges of blackmail – is expected to be committed to the ACT Supreme Court later this month.
Tuungafasi Manase, of Evatt, was in August arrested and charged with intentionally giving evidence that he knew to be false or misleading during a commission hearing.
Mr Lomax played 65 games for the Canberra Raiders from 1993 to 1996, and won the club's player of the year award in the 1994 premiership-winning season.
He then moved to the North Queensland Cowboys and finished his NRL career with the Melbourne Storm, retiring in 2000.
