Invista Textiles (UK) Ltd & Anor v Botes & Ors

An express post-termination confidentiality clause is unenforceable if it restrains the use of information forming part of an employee’s general skill and knowledge, or otherwise extends beyond the employer’s legitimate proprietary interests. A non-compete clause must be directed to protecting a legitimate interest and must be no wider than reasonably necessary; a short duration does not cure an unreasonable scope. An obligation to return electronic company property requires delivery of copies and reasonable deletion of retained copies, but does not ordinarily extend to files deleted during employment and no longer within the employee’s possession or control at termination. A non-solicitation clause protecting workforce stability may remain enforceable.

Invista sued three former employees and two companies arising from the proposed establishment and operation of VideraBio. The claims concerned misuse of confidential information, retention of company property, post-termination restraints, breaches of employment duties, and inducing SilicoLife to breach its agreement with Invista.

The court considered documents retained or deleted on personal devices, preparatory work undertaken while the defendants remained employed, and dealings with SilicoLife. The central issues were the enforceability and construction of the contractual restraints, the scope of the obligation to return electronic company property, and whether the alleged conduct established contractual or tortious liability.

1. Confidentiality. The contractual definition of confidential information was wide and uncertain. It covered information forming part of an employee’s skill and experience and documents marked confidential irrespective of content. Clause 1.2 was therefore an unreasonable restraint of trade and unenforceable after termination. The defendants remained subject to an equitable duty protecting trade-secret-type information, but no post-employment misuse was proved.
2. Company property. Clause 3 required delivery of company property, including electronic copies, and was not satisfied merely by deletion. An employee could comply by supplying copies and taking reasonable steps to delete home copies. However, files deleted to level 3 during employment were no longer within the employee’s possession or control for the purposes of clause 3 at termination. The patent list was company property and its non-return was a breach. The Chen Library was also company property, and Dr Chen breached clause 3 by failing to return documents still live or at level 2 and by deleting such documents after termination.
3. Restraints and fidelity. The three-month non-compete clause was directed at information rather than competition in the ordinary sense, but its breadth prevented the employees from using their general expertise and was an unreasonable restraint. The non-solicitation clause was enforceable because Invista had a legitimate interest in workforce stability; Dr Botes breached it. Preparatory work undertaken while employed breached clause 5.2.1 and, if separately owed, the implied duty of fidelity.
4. SilicoLife and remedies. No inducement of breach was established. The claim for breach of confidence and the SilicoLife claim were dismissed. Company property was to be delivered up, but no inquiry as to damages was ordered; costs were reserved.

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