High Court Orders Destruction of Confidential Information on Defendants’ Computers


3 mins

Posted on 25 May 2016

The High Court has ordered the destruction of any confidential information found on electronic devices and computers belonging to ex-employees and their new employer.

Speedread

The High Court has ordered the inspection and imaging of electronic devices and computers belonging to ex-employees and their new employer, and the destruction of any confidential information belonging to the former employer found on them. Although such an order had not been made in any previous reported cases, it considered that the order was justified because the defendants had admitted using their employer's confidential information and the evidence showed that they could not be trusted to seek out and delete the relevant material themselves. 

Facts

In Arthur J. Gallagher Services (UK) Limited and others v Skriptchencko, Mr Skriptchenko worked for Gallagher until July 2014. In February 2015, he started working for Portsoken Limited. In July 2015, Gallagher suspected that its confidential information was being used by Mr Skriptchenko and his new employer and issued proceedings against them both. Mr Skriptchenko admitted that he had taken a client list from Gallagher and Portsoken admitted it had used it to approach 300 of Gallagher’s clients. 

Gallagher successfully applied for an order that:

  • Mr Skriptchenko deliver up all of his electronic devices for inspection
  • Portsoken permit Gallagher's forensic IT expert access to all of its computer systems to search for confidential information belonging to Gallagher.

This resulted in 4,000 documents being disclosed which showed that directors and employees of Portsoken were misusing Gallagher’s confidential information. 

Gallagher applied to add five individuals as defendants and sought an order allowing it to:

  • Inspect and take images from all of the defendants' computers and electronic devices
  • Delete any confidential information belonging to Gallagher found on them.

The defendants admitted that they had misused Gallagher's confidential information, but only to the extent already disclosed. They argued that a search of devices and destruction of material was "invasive, unprecedented and unnecessary". In response, Gallagher gave a number of assurances: 

  • The devices and computers should be delivered to the defendants' IT expert, and not Gallagher's
  • If there was a dispute about whether material contained Gallagher's confidential information, the disputed material need not be shown to Gallagher if the defendants maintained that it contained their own confidential information
  • A copy of the material deleted from the defendants' devices would be preserved so that if it was subsequently found to have been wrongly removed, it could be restored to the defendants.

Decision

The High Court granted the order sought. It took into account the fact that the defendants had admitted taking Gallagher’s confidential information, the material disclosed showed a “high degree of subterfuge” in using Gallagher’s confidential information and the evidence showed the defendants could not be trusted to seek out and delete the relevant material themselves. 

Implications

An order for deletion of confidential information is an unusual one. Indeed the parties in this case were unable to point to any case where such an order had been made. The Court was not persuaded that a lesser order, such as requiring the defendants themselves to search for and destroy Gallagher’s confidential information, offered sufficient protection. The defendants had admitted to misusing Gallagher’s confidential information and were well aware of the fact that they were breaching confidentiality obligations. In the circumstances they could not be trusted.

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