Digital Technology Law Journal

6. The Defendants submitted that the Plaintiff had failed to sufficiently identify the information alleged to constitute confidential information and trade secrets and, in any event, had failed to distinguish between that information and the knowledge and experience gained by the Defendants from working in the industry generally.

7. Roberts-Smith J, in considering this issue, quoted extensively from his judgment in Independent Corporate Services Ltd v Stephens [2002] WASC 280 in which substantial reference was made to Faccenda Chicken Ltd v Fowler & Ors [1986] 1 All ER 617. In this respect, his Honour accepted that “such information is capable of attracting protection as trade secrets or confidential information” and that there was a serious question to be tried on the matter.

8. His Honour also noted the Plaintiff’s submissions in respect of the judicial and academic criticism of Faccenda concerning the extent to which confidential information not amounting to a trade secret could be protected by a restrictive covenant. In that regard, his Honour stated his view of the law, based on the judgments of Samuels JA and Kirby P in Wright v Gasweld Pty Ltd (1991) 22 NSWLR 317, to be that “confidential information falling short of a “trade secret” may be protected after the termination of employment, by an express restrictive covenant”. However, his Honour considered it unnecessary to address, and therefore left open questions relating to, the limitations that would apply to such a restraint.

Breach of Fiduciary Duty

9. The Plaintiff had submitted that irrespective of what the position was in relation to the confidential information, the Defendants’ failure to give the requisite four weeks notice that was required by the employment contract meant that the Agreements were still operative and as such the Defendant’s were contractually bound not to use that information. In this regard, his Honour made reference to the fact that employment relationships were not “purely contractual” and pointed to their fiduciary nature. His Honour did point out, however, that if the Plaintiff’s evidence were accepted at trial, those Agreements would have been operative for the “continuation of the defendants’ employment with the plaintiff”.

10. Finally, Roberts-Smith J addressed the plaintiff’s submission that an injunction should be granted because the confidential information and trade secrets used by the Defendants would give them a commercial “headstart” over any competitor other than the Plaintiff. In doing so, his Hounour cited with approval United States Surgical Corp v Hospital Products International Pty Ltd [1983] 2 NSWLR 157 and held that there was a serious question to be tried as to whether, in the absence of protection being granted over the information, damages should be afforded to the Plaintiff.

Conclusion

11. Having regard to the balance of convenience, Roberts-Smith J noted that:

12. On the above basis, his Honour found that the balance of convenience was entirely with the Plaintiff and ordered that the interlocutory injunction be granted.