Our Knowledge

19.Sep.2013

Whitmar Publications Ltd v Gamage

In the recent case of Whitmar Publications Ltd v Gamage the High Court granted interim injunctions to prevent former employees of Whitmar from misusing confidential information to gain an unfair commercial advantage in a newly formed rival publishing business.

Whilst still employed at Whitmar, Mr Gamage and two other senior employees set up a company, Earth Island Publishing Limited, in competition with Whitmar. Mr Gamage and the others attempted to solicit existing clients and employees of Whitmar and removed approximately 450 business cards containing client contact details from Whitmar’s premises. They also used Whitmar’s LinkedIn groups to promote their new business and refused to release log in details for the account after leaving employment.

Despite the former employees having no written contracts of employment, Whitmar was able to rely on the implied duty of good faith and fidelity which the employees had breached in taking steps to set up the rival business. Having found that Whitmar was likely to succeed at trial, the High Court granted springboard injunctions obliging the former employees to return access, management and control of the LinkedIn accounts to Whitmar and stopping them from preventing Whitmar accessing them. The injunctions also prohibited the employees contracting with any of the clients named on the 450 business cards.

This case shows that courts are likely to find that contacts in an employer’s LinkedIn account belong to the employer, even if the account may have been maintained by employee on behalf of the employer, and that courts may grant injunctions where former employees attempt to misuse such contact information following the end of the employment relationship.

This case does not address what would happen to the personal LinkedIn account of an employee where they share the same contacts as the employer.  Employers’ social media policies should set out acceptable usage and be clear about who owns business contacts made by employees during their employment. A practical solution might be to require employees to set up a separate LinkedIn account during working hours using work photos and contact details only, coupled with a contractual requirement to delete any of the employer’s business contacts from a personal account on termination. It is not clear whether this would be enforced by the courts and is likely to depend on how connected the account is with the employment.

Employers should also give thought to use of contractual post-termination restrictions, which aim to prevent solicitation and dealing with the employer’s contacts.