In a significant decision, the Federal Court granted an
injunction restraining Matthew Aladesaye, a former employee of APT
Technology Pty Ltd (APT), from soliciting or dealing with any of
APT's clients, despite the absence of any express restraint of
trade clause in the employment contract. The Court also ordered Mr
Aladesaye be restrained from directly or indirectly using or
disclosing any confidential information or intellectual property
belonging to APT, until the final hearing of the matter, or until
Sparke Helmore represented APT in the matter.
Mr Aladesaye was restrained on the basis of the
"springboard principle", which prevents a person from
using confidential information as a springboard for activities
detrimental to the person who owned or made the confidential
APT is a mechanical engineering consultancy operating in Sydney
and Adelaide. Matthew Aladesaye was APT's main engineer and the
key salesperson for the Adelaide business.
From January 2013 or earlier, Mr Aladesaye set up his own
business in direct competition with APT. Until his employment was
terminated on 16 June 2014, Mr Aladesaye used and disclosed for his
own purposes APT's confidential information, which included the
contents of APT's client databases, reports prepared by APT and
other business documentation used by APT.
This was in breach of his employment contract, which expressly
required him to devote his whole "time, attention and
skills" to his APT duties, and not engage in any business
activity in competition with APT. His contract also prohibited his
use of APT's confidential information for anything other than
his role at APT.
What did the court decide?
Justice Foster found that:
APT was entitled to "the additional protection" of a
non-solicitation restraint and that APT was entitled to have its
confidential information protected and not used against it by its
former employee who owed contractual, equitable and statutory
duties to it during the course of and, in some respects, after, the
period of employment.
Mr Aladesaye had a significant head-start over APT in securing
the business of its former and existing clients and in servicing
them to the detriment of APT.
Mr Aladesaye used his position as APT's employee and the
possessor of APT's confidential information to gain a
significant advantage over APT in securing the future business of
its existing and former clients.
An injunction should be granted until January 2015, or until
earlier further order, restraining Mr Aladesaye from directly or
indirectly canvassing, soliciting or dealing with any of APT's
A restraint on Mr Aladesaye's dealings with existing and
former clients (pending the final hearing of the proceeding), was
justified on the basis that it is appropriate relief designed to
protect APT from the damage already caused to it and its business,
as well as the damage likely to be caused to it and its business as
result of Mr Aladaseye's actions.
The matter is listed on 8 October to be set down for final
hearing, including the hearing for APT's claim to damages.
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