The claimant sought an order to prevent the defendant, a former employee, from misusing its confidential information said to be held by her. Her contract contained no post employment restrictions but did seek to control confidential and other information. She had obtained employment with a customer of the claimant, and was said to carry out a similar managerial role in which she would make use of the financial and associated information she carried forward. The order sought was unlimited in time, did not specify what information was to be protected and went beyond any contractual obligation.
Held: The interim injunction was refused. The application gave the appearance of the claimant not intending to take the matter to any final hearing, but rather to resolve the issues on a more comfortable (for it) interim assessment. They had delayed in serving particulars and gave no fixed commitment to service of them. It was an abuse.
The clause on which the claimants based their case was too widely drawn including matters in which no confidence existed, and matters which an employee would carry in her head and be bound to be allowed to use. The order sought was also too widely drawn, in particular in having no time limit. Nor was there any evidence that the defendant had acted with any impropriety.
Tugendhat J discussed whether an employee could be said to be a fiduciary: ‘an employee may be a fiduciary in respect of specific property or confidential information entrusted to her care, even if her level of responsibility in the business is at the most junior level. This step in the argument for CLS is a strong one. I would also accept that there may be cases where an employee is in a relationship with her employer which is analogous to that of a trustee to a beneficiary, a parent to a child, or a solicitor to her client. But that is not the normal relationship between an employee and employer in the business context which was under consideration in all the employment cases referred to above (except Barker which was a case of domestic employment). In the normal employment relationship the balance of power is the opposite of that referred to in the examples given in Erlanger: it is the employer which is the dominant party.’
Judges:
Tugendhat J
Citations:
[2011] EWHC 3154 (QB)
Links:
Jurisdiction:
England and Wales
Citing:
Cited – Prince Jefri Bolkiah v KPMG (A Firm) HL 16-Dec-1998
Conflicts of Duty with former Client
The House was asked as to the duties of the respondent accountants (KPMG). KPMG had information confidential to a former client, the appellant, which might be relevant to instructions which they then accepted from the Brunei Investment Agency, of . .
Cited – Printers and Finishers Limited v Holloway 1965
The court considered the questions arising from the use of information acquired by an employee during his employment after that employment had ended, and noted that information the future use of which will not be restrained is information not . .
Cited – Faccenda Chicken Ltd v Fowler CA 1986
Nature of Confidentiality in Information
The appellant plaintiff company had employed the defendant as sales manager. The contract of employment made no provision restricting use of confidential information. He left to set up in competition. The company now sought to prevent him using . .
Cited – Herbert Morris Ltd v Saxelby HL 1916
For a covenant in restraint of trade to be treated as reasonable in the interests of the parties ‘it must afford no more than adequate protection to the benefit of the party in whose favour it is imposed.’ There is a need for the court to consider . .
Cited – Balston Ltd v Headline Filters Ltd and Another 1987
The second defendant, whilst still during his notice period to leave employment by the plaintiff, began to make arrangements to start his own competing business, and solicited future business from a customer of the plaintiff. The plaintiff sought an . .
Cited – Lansing Linde v Kerr CA 1991
Staughton LJ held that ‘trade secrets’ embrace information used in a trade, restricted in its dissemination, and the disclosure of which would be liable to cause real or significant harm to the party claiming confidentiality. He considered the . .
Cited – Mont v Mills 1993
Simon Brown LJ said: ‘I cannot accept that the law’s only concern underlying the doctrine of restraint of trade is to ensure that employees can earn their living . . If this were so, such restraints could always be purchased outright and yet the . .
Cited – Ocular Sciences Ltd v Aspect Vision Care Ltd ChD 11-Nov-1996
The freedom for a claimant in registered design right to frame his claim, as to whether he asserts an infringement of the entire design, or limits it to the section infringed, is important.
Laddie J said: ‘This means that the proprietor can . .
Cited – Roger Bullivant Ltd v Ellis CA 1987
The plaintiffs sought various remedies against an ex-employee who had set up a company in competition with the plaintiffs. One was for breach of confidence in respect of a card index of customer contacts, a copy of which the first defendant had . .
Cited – Frisbee v Campbell CA 14-Oct-2002
The claimant sought an account against her former employee for the disclosures made by her of their activities. The respondent had signed a confidentiality agreement. The respondent counterclaimed for assault. She now appealed from dismissal of her . .
Cited – United Pan-Europe Communications N V v Deutsche Bank Ag CA 19-May-2000
The claimant sought to prevent the misuse of what it said was its confidential information, identifying it by reference to specific documents in which it was said to be recorded.
Held: That was a sufficient description because the defendant . .
Cited – Attorney General v Barker CA 1990
A claim was made for an injunction to enforce an express covenant in a contract of employment by a member of the Royal Household by which he undertook (amongst other things) not to publish any information concerning a member of the family which came . .
Cited – Lock International plc v Beswick ChD 1989
Where the claimant seeks to prevent a former employee using some but not all information obtained during his employment, the employer must be specific as to the range of what is to be protected.
Hoffmann J said: ‘Some employers seem to regard . .
Cited – Littlewoods Organisations Ltd v Harris CA 1977
When construing restrictive covenants in an employment contract, the court should construe the contract in the light of the object and intent of the contract as a whole. It may be read down and need not be read literally. Lord Denning said that it . .
Cited – Erlanger v New Sombrero Phosphate Company HL 31-Jul-1878
Rescission needs Restitutio in Integrum
A syndicate, of which Erlanger (Orse Erlinger) was the head, purchased from an insolvent company an island, said to contain valuable mines of phosphates. Erlanger, who managed the purchase, prepared to get up a company to take over the island and . .
Cited – Meat Corporation of Namibia Ltd v Dawn Meats (UK) Ltd ChD 7-Mar-2011
The parties disputed the expert evidence to be admitted at a forthcoming trial. The claimant opposed the use of a particular expert witness who had had access to its confidential and privileged information and should not be allowed to act for the . .
Cited – Dyson Technology Ltd v Strutt ChD 25-Nov-2005
The claimant sought to restrain the defendant, one of its former engineers from working for a competitor and using the confidential knowledge he had obtained when working for them.
Held: The court set out the difficulties for a leaving . .
Cited – Koch Shipping Inc v Richards Butler (a Firm) CA 22-Jul-2002
The claimants in an arbitration sought orders with regard to a solicitor who had moved to the opponent’s firm of solicitors, but who came with privileged knowledge of the claimant’s business dealings. She offered undertakings, but the claimant . .
Cited – John Zink and Co Limited v Wilkinson CA 1973
Where a party alleged breach of confidence, the pleadings should be sufficiently particular to allow a defendant to know the particular allegations he faced. . .
Cited – American Cyanamid Co v Ethicon Ltd HL 5-Feb-1975
Interim Injunctions in Patents Cases
The plaintiffs brought proceedings for infringement of their patent. The proceedings were defended. The plaintiffs obtained an interim injunction to prevent the defendants infringing their patent, but they now appealed its discharge by the Court of . .
Cited – Lansing Linde v Kerr CA 1991
Staughton LJ held that ‘trade secrets’ embrace information used in a trade, restricted in its dissemination, and the disclosure of which would be liable to cause real or significant harm to the party claiming confidentiality. He considered the . .
Cited – Robert v Momentum Services Ltd CA 11-Feb-2003
The claimant appealed against an order refusing an extension of time for service of her particulars of claim. She had made the application before the period expired.
Held: The rules made a clear distinction between applications made before . .
Cited – Thomas v The Home Office CA 19-Oct-2006
The court was asked the parties agree an extension of time for service of a claim form outside the period specified in r. 7.5. The particulars of claim were served nearly five months late.
Held: An extension of time could be agreed between the . .
Cited – Price v Price (Trading As Poppyland Headware) CA 26-Jun-2003
The claimant sought damages from his wife for personal injuries. He had been late beginning the claim, and it was served without particulars. He then failed to serve the particulars within 14 days. Totty and then Sayers had clarified the procedure . .
Lists of cited by and citing cases may be incomplete.
Intellectual Property, Employment
Updated: 07 September 2022; Ref: scu.449397