FACE IT LTD v. LUK MEI LING AND OTHERS

FACE IT LTD v. LUK MEI LING AND OTHERS

The court found that the customer particulars and communication records, given their collation, use and contractual non-disclosure clauses, possessed the necessary quality of confidentiality; there was sufficient evidence that defendants retained and used such information to solicit customers for a competing business; damages would be inadequate and the balance of convenience favored equitable protection; accordingly interlocutory relief for delivery up and a negative injunction was granted subject to a fortified cross-undertaking of HK$1,000,000.

Citation
[2019] HKCFI 1416
Parties
Plaintiff: FACE IT LIMITED; 1st Defendant: LUK MEI LING; 2nd Defendant: NGAI KWAN YU; 3rd Defendant: YIP MAN YEE; 4th Defendant: LAI YUEN MING; 5th Defendant: CHAN PUI MAN; 6th Defendant: CHAN NGA MAN; 7th Defendant: KWONG WING MAN SILVER; 8th Defendant: CALY GROUP LIMITED
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
28 May 2019
Case Number
HCA299/2019
Procedural Posture
Interlocutory Application for Interim Injunction (misuse of Confidential Information / Employment Dispute) / Inter Partes Summons Heard at Interim Injunction Hearing Prior to Trial
Outcome
Interlocutory relief granted in part: delivery-up order and negative injunction issued; plaintiff ordered to provide HK$1,000,000 fortification; costs to plaintiff's costs in the cause
Legal Topics
Non Disclosure Clause, Misuse of Customer Data, Non Solicitation, Delivery Up Order, Cross Undertaking Fortification
Source Language
EN
Employment Confidential Information / Trade Secrets Equity Injunctions Non Disclosure Clause Misuse of Customer Data Non Solicitation Delivery Up Order Cross Undertaking Fortification

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Parties

FACE IT LIMITED

Plaintiff

LUK MEI LING

1st Defendant

NGAI KWAN YU

2nd Defendant

YIP MAN YEE

3rd Defendant

LAI YUEN MING

4th Defendant

CHAN PUI MAN

5th Defendant

CHAN NGA MAN

6th Defendant

KWONG WING MAN SILVER

7th Defendant

CALY GROUP LIMITED

8th Defendant

Procedural Posture

Interlocutory Application for Interim Injunction (misuse of Confidential Information / Employment Dispute) / Inter Partes Summons Heard at Interim Injunction Hearing Prior to Trial

Legal Issues

  1. 1 Whether customers information and communication records constitute confidential information/trade secrets
  2. 2 Whether the individual defendants possess or have used that confidential information to poach customers
  3. 3 Whether interlocutory relief (delivery up and negative injunction) should be granted

Ratio Decidendi

The court found that the customer particulars and communication records, given their collation, use and contractual non-disclosure clauses, possessed the necessary quality of confidentiality; there was sufficient evidence that defendants retained and used such information to solicit customers for a competing business; damages would be inadequate and the balance of convenience favored equitable protection; accordingly interlocutory relief for delivery up and a negative injunction was granted subject to a fortified cross-undertaking of HK$1,000,000.

Court Disposition

Interlocutory relief granted in part: delivery-up order and negative injunction issued; plaintiff ordered to provide HK$1,000,000 fortification; costs to plaintiff's costs in the cause

Orders

  • 1. Within 10 days the 1st to 4th defendants shall deliver up to the plaintiff all Customers Information and Communication Records in their possession, custody or power (including names, ID numbers and all contact details and messages)
  • 2. The 1st to 4th defendants are restrained from divulging the Confidential Information to any third parties, from keeping records of it and from using it to contact any customers of the plaintiff for purposes of running a business in competition with the plaintiff, save where the defendant had the customer's...