Media Agency Group Ltd v Transport Media Ltd

Confidentiality protects the product of confidential analysis, even where its component materials are publicly available. The relevant confidential information may lie in a compilation or combination of data, such as the most profitable keywords and match types identified through specialist analysis. A former consultant may compete lawfully, but may not use that information to obtain a springboard or head start.

Passing off requires goodwill or reputation, a misrepresentation likely to cause confusion, and damage or likely damage. Registration and use of a domain name can amount to actionable passing off where it exploits another trader’s goodwill.

The first claimant, a media planning and advertising business trading under the name Transport Media, sued its former consultant, the company through which he operated, and another individual. It alleged misuse of confidential information concerning profitable Google AdWords keywords and match types, and passing off through the use of confusingly similar trading styles and domain names.

The claim followed the setting aside of an earlier default judgment and proceeded to a five-day trial. The court determined whether the alleged consultancy agreement was genuine, whether confidential information had been misused, whether court orders and undertakings had been breached, and whether the defendants had passed off their business as that of the first claimant.

1. Contract and confidentiality. The first claimant proved that the second defendant had drafted and signed the consultancy agreement. Its confidentiality provisions therefore bound him. Independently, the information also satisfied the principles in Coco v A N Clark (Engineers) Ltd [1968] FSR 415. The protected information was not the individual keywords or match types, but the confidential compilation of the most successful combinations, derived from analysis of conversion rates and profitability.
2. The defendants’ use of that information gave the new business a competitive head start or springboard. The claimants could not prevent legitimate competition or the establishment of a competing advertising agency, but they could restrain misuse of the confidential analysis. The claim for misuse of confidential information succeeded.
3. The court adopted the principles governing springboard relief summarised in QBE Management Services (UK) Ltd v Dymoke [2012] EWHC 80 (QB). Although breaches of the earlier order and undertakings were proved on the balance of probabilities, the advantage obtained was insufficient to justify extending relief beyond 18 April 2018. Any committal application would require separate consideration and should not be listed before this judge.
4. Passing off. The first claimant had goodwill in Transport Media. The defendants’ use of Transport Media Agency and related domain names constituted a misrepresentation likely to cause confusion and had caused damage. Applying Phone4U Ltd v Phone4U.co.uk [2006] EWCA Civ 244 and British Telecommunications plc v One in a Million Ltd [1999] 1 WLR 903, registration of a domain name was capable of amounting to actionable passing off.
5. Judgment was entered for the first claimant in relation to confidential information and passing off. No relief was granted to the dormant second claimant. An inquiry as to damages, equitable compensation and/or an account of profits was ordered.

First-instance judgment. The judgment records earlier procedural orders setting aside a default judgment and imposing undertakings, but no appellate decision is stated.