The defendants made up prefabricated portable buildings to the plaintiffs’ design, provided to them only for this purpose. When the contract ended, the defendants then offered their own prefabricated buildings using much of the material, including modifications, claiming that any duty of confidence was discharged once the plaintiffs sold buildings and published brochures which disclosed all the features of their buildings. The defendants denied having in fact employed any of the confidential material in development of its own designs.
Held: The interlocutory injunction requested by the plaintiff was granted. The defendants had been using the confidential material before the manager arrived who designed their own building, and had no access to the materials, but may have had indirect access through his staff, and his mind may have been ‘saturated’ with the knowledge. In effect his task had been not to design a new building but to improve on that of the plaintiffs. Roxburgh J said: ‘When, therefore, Mr Chambers was instructed on behalf of the first defendants to design a new building unit – and I may say I have no doubt at all that in June or July 1958 Mr Moere was taking precautionary steps in anticipation of a breakdown of the negotiations for an extension of the contract – intended, as I am quite certain it was, to compete in the open market with the Mark 24 as about to be improved, he could not have avoided starting his dive into the future from the springboard of the confidential information acquired by the first defendants and by Mr Chambers as their servant’
In relation to ‘information’ for the purposes of the springboard principle, he said: ‘Therefore, in my judgment, Mr Chambers, acting for the first defendants, used the aforesaid confidential information directly or indirectly obtained from the plaintiffs without the consent, express or implied, of the plaintiffs within the meaning of the passage which I have already read. Lord Greene draws no distinction between documents and other types of information, and, in my judgment, in principle there is not, though not doubt documents are often more specific than other types of information, and there may well be cases in which information may merge with general knowledge. I recognise the possibility of such cases, but this is, in my judgment, not one of them, and when I use the word ‘information’, I mean something that can be traced to a particular source and not something which has become so completely merged in the mind of the person informed that it is impossible to say from what precise quarter he derived the information which led to the knowledge which he is found to possess.
As to the submission that the confidentiality obligation was discharged when the plaintiffs published all the general features of the building units in brochures and by putting the goods on the market (thereby enabling every member of the public by the elementary process of dismantling to access the confidential information), Roxburgh J said: ‘As I understand it, the essence of this branch of the law, whatever the origin of it may be, is that a person who has obtained information in confidence is not allowed to use it as a spring-board for activities detrimental to the person who made the confidential information, and spring-board it remains even when all the features have been published or can be ascertained by actual inspection by any members of the public. The brochures are certainly not equivalent to the publication of the plans, specifications, other technical information and know-how. The dismantling of a unit might enable a person to proceed without plans or specifications or other technical information, but not, I think, without some of the know-how, and certainly not without taking the trouble to dismantle. I think it is broadly true to say that a member of the public to whom the confidential information had not been imparted would still have to prepare plans and specifications. He would probably have to construct a prototype, and he would certainly have to conduct tests. Therefore, the possessor of the confidential information still has a long start over any member of the public. The design may be as important as the features. It is, in my view, inherent in the principle upon which the Saltman case rests that the possessor of such information must be placed under a special disability in the field of competition in order to ensure that he does not get an unfair start; or, in other words, to preclude the tactics which the first defendants and the third defendants and the managing director of both of those companies employed in this case.’
Judges:
Roxburgh J
Citations:
[1967] RPC 375
Jurisdiction:
England and Wales
Cited by:
Cited – British Broadcasting Corporation v Harpercollins Publishers Ltd and Another ChD 4-Oct-2010
The claimant sought an injunction and damages to prevent the defendant publishing a book identifying himself as ‘the Stig’ saying that this broke his undertaking of confidentialty as to his identity, a necessary part of the character in the TV . .
Lists of cited by and citing cases may be incomplete.
Intellectual Property
Updated: 23 June 2022; Ref: scu.424857
