MPT Group Ltd v Peel & Ors

Springboard relief is available to restrain an unfair competitive advantage obtained through wrongdoing, including breaches of contractual or fiduciary duties. It must be sought while the advantage remains, and must restore the parties to the position they would have occupied lawfully. It is compensatory rather than punitive, and its duration must reflect the actual advantage proved.

Where an interim injunction would effectively determine the dispute before trial, and the likely period of relief will substantially expire before judgment, the court must examine the merits more closely when assessing the balance of convenience. Taking confidential information does not itself establish misuse. A claimant must show actual use, although adverse inferences may arise from the circumstances and destruction of evidence.

MPT Group Limited sought interim injunctions against two former senior employees and their newly incorporated competing company. It alleged misuse of confidential information, infringement of database and copyright rights, breaches of contractual and fiduciary duties, unlawful means conspiracy and inducement of breach of contract.

The claimant sought a springboard injunction lasting until April 2018 and a permanent injunction under contractual confidentiality clauses. The central issues were whether a subsisting competitive advantage had been established, whether damages were adequate, and whether the contractual confidentiality provisions were enforceable in their drafted form.

1. Springboard relief. The court adopted the principles summarised in QBE Management Services (UK) Ltd v Dymoke [2012] EWHC 80 (QB). Relief may address an unlawful competitive advantage arising from breaches of confidence, contract or fiduciary duty. It must be sought while the advantage continues, must be fair and proportionate, and must not punish the defendant. Its duration is measured by the advantage actually obtained and the time needed to achieve lawfully what was achieved unlawfully.
2. Interim approach. The ordinary American Cyanamid Co. v Ethicon Ltd [1975] A.C. 396 approach was modified because a speedy trial would occur after any likely springboard advantage had substantially expired. Applying NWL Ltd v Woods [1979] 1 W.L.R. 1294 and Lansing Linde Limited v Kerr [1991] 1 W.L.R. 251, the court examined the likely merits to assess the balance of convenience.
3. The claimant established a serious issue to be tried and damages were inadequate for both sides. However, taking data did not create an irrebuttable presumption of use. The evidence, including the defendants’ admissions, the destruction of devices and the speed of development, justified scepticism but remained largely inferential. The machines also displayed significant differences. The claimant was unlikely to establish sufficient misuse to justify springboard relief. The application for that relief was therefore dismissed.
4. The contractual confidentiality clauses were enforceable despite their indefinite duration, applying Caterpillar Logistics Services Ltd v Huesca de Crean [2012] EWCA Civ 156. Their broad and generic definition of confidential information was nevertheless objectionable. Following Thomas v Mould [1968] 2 Q.B. 913 and Ocular Sciences Ltd v Aspect Vision Care Ltd [1997] RPC 289, the relief sought under clause 16 was refused as drafted.
5. Independently of clause 16, the claimant was entitled to limited protection pending trial for its technical drawings, customer and supplier lists, and bill of materials database. The order excluded the single measurement which Mr Peel admitted using.

First-instance decision. No appellate history is stated in the judgment.