Confidential Information

1
Confidential Information

• Cameron Stewart

2
The obligation

• Saltman Engineering Co Ltd v Campbell Engineering
  Co Ltd (1948) 65 RPC 203 at 213
• If a defendant is proved to have used
  confidential information, directly or indirectly
  obtained from a plaintiff, without the consent,
  express or implied, of the plaintiff, he will be
  guilty of an infringement of the plaintiffs
  rights.

3
What is confidential information?

• the myriad ways obligations of confidence
• The phrase is best viewed as a term that covers
  information that is subject to an obligation of
  confidentiality.
• What sorts of relationships give rise to
  obligations of confidence? Confidences arise in
  three sorts of relationships private
  confidences, confidences relating to government
  secrets, and commercial confidences.

4
The origins of the action for breach of
confidence

• Property origins
• Franklin v Giddins 1978 Qd R 72
• Krueger Transport Equipment Pt Ltd v Glen Cameron
  Storage 2008 FCA 803
• OBG Ltd v Allan 2008 1 AC 1
• Contract origins
• Deta Nominees Pty Ltd v Viscount Plastic Products
  Pty Ltd 1979 VR 167
• Seager v Copydex Ltd 1967 2 All ER 415
• Ministry of Defence v Griffin 2008 EWHC 1542

5
The origins of the action for breach of
confidence

• Tort origins economic torts or fusion fallacy?
• Campbell v Mirror Group Newspapers Ltd 2004 2
  AC 457
• Mosley v News Group Newspapers Ltd 2008 EWHC
  177
• Human rights?
• Unjust enrichment?

6
Equitable origins in conscience

• Like most heads of exclusive equitable
  jurisdiction, its rational basis does not lie in
  proprietary right. It lies in the notion of an
  obligation of conscience arising from the
  circumstances in or through which the information
  was communicated or obtained.
• Moorgate Tobacco Co Ltd v Philip Morris Ltd (No
  2) (1984) 156 CLR 414 at 4378 per Deane J

7
The modern doctrine of breach of confidence

• Coco v A N Clark (Engineers) Ltd

8
The modern doctrine of breach of confidence

• Coco v A N Clark (Engineers) Ltd, Megarry J
• In my judgment, three elements are normally
  required if, apart from contract, a case of
  breach of confidence is to succeed. First, the
  information itself, in the words of Lord Greene
  MR in the Saltman case on page 215, must have
  the necessary quality of confidence about it.
  Secondly, that information must have been
  imparted in circumstances importing an obligation
  of confidence. Thirdly, there must be an
  unauthorised use of that information to the
  detriment of the party communicating it.

9
Information that has a confidential quality

• Secrecy and the public domain
• Lucasfilm Ltd v Ainsworth 2008 EWHC 1878
• Lennon v News Group Newspapers Ltd 1978 FSR
  573, John Lennon failed to prevent his former
  wife from publishing secrets of their married
  life, on the basis that he had himself published
  information on the topic.

10
Information that has a confidential quality

• Transitory publication - a Chinese pop star was
  successful in restraining the publication of an
  embarrassing video tape on the Internet, even
  after a verbal account of the contents had been
  published in a Hong Kong newspaper Kwok v Thang
  1999 NSWSC 1034
• G v Day 1982 1 NSWLR 24 .

11
Australian Football League v Age Company Ltd
(2007) 15 VR 405

• 3 AFL players who had tested positive to drugs
  were identified on an internet discussion forum.
• An electronic newspaper article had also named
  the players to a limited group of subscribers for
  about 5 hrs.
• A further publication of one of the players
  names had occurred when a phone caller named the
  player on the Fox Footy television program.
• Regardless, Kellam J found that the information
  had still not yet fully entered the public domain
  and remained confidential. A permanent injunction
  was ordered on the release of the players
  identities.

12
Personal information

• Prince Albert v Strange

13
Personal information

• marital and defacto relations
• Giller v Procopets
• sexual preference and activity
• Stephens v Avery
• A v B (a company) 2002 2 All ER 545
• Theakston v Mirror Group Newspapers Ltd 2002
  EWHC 137
• Mosley v News Group Newspapers
• A v B plc 2003 QB 195
• Brown v Associated Newspapers Ltd 2008 QB 103

14
Personal information

• Diaries
• Prince of Wales v Associated Newspapers
• McKennitt v Ash 2008 QB 73
• Medical history
• X v Y 1988 2 All ER 648
• Campbell v MGN Ltd 2004 UKHL 22.
• Witnesses and informants
• Venables v News Group Newspapers Ltd 2001 1 All
  ER 908
• Rogers v TVNZ 2007 NZSC 91
• Cultural and religious information
• Foster v Mountford Rigby Ltd
• Church of Scientology of California v Kaufman
  1973 RPC 635

15
Commercial information

• Trade secrets or know-how?
• Ansell Rubber Co Pty Ltd v Allied Rubber
  Industries Pty Ltd
• (1) the extent to which the information is known
  outside of his business (2) the extent to which
  it is known by employees and others involved in
  his business (3) the extent of measures taken by
  him to guard the secrecy of the information (4)
  the value of the information to him and to his
  competitors (5) the amount of effort or money
  expended by him in developing the information
  (6) the ease or difficulty with which the
  information could be properly acquired or
  duplicated by others.

16
Commercial information

• Faccenda Chicken Ltd v Fowler
• 1.trivial information, which is publicly
  available or so obvious that it cannot be
  protected
• 2.information that must be treated confidentially
  until the termination of employment, whereupon it
  becomes part of the ex-employees collective
  skill, knowledge and ability or
• 3.highly confidential trade secrets, which will
  be protected by the courts even after the
  termination of employment.

17
Commercial information

• Del Casale v Artedomus (Aust) Pty Limited 2007
  NSWCA 172
• . The extent to which the information is known
  outside the business.
• 2. The extent to which the trade secret was known
  by employees and others involved in the
  plaintiffs business.
• 3. The extent of measures taken to guard the
  secrecy of the information.
• 4. The value of the information to the plaintiffs
  and their competitors.
• 5. The amount of effort or money expended by the
  plaintiffs in developing the information.

18
Commercial information

• 6. The ease or difficulty with which the
  information could be properly acquired or
  duplicated by others.
• 7. Whether it was plainly made known to the
  employee that the material was by the employer as
  confidential.
• 8. The fact that the usages and practices of the
  industry support the assertions of
  confidentiality.
• 9. The fact that the employee has been permitted
  to share the information only by reason of his or
  her seniority or high responsibility.
• 10. That the owner believes these things to be
  true and that belief is reasonable.
• 11. The greater the extent to which the
  confidential material is habitually handled by
  an employee, the greater the obligation of the
  confidentiality imposed.
• 12. That the information can be readily
  identified.

19
Commercial information

• Hodgson JA
• Where the confidential information is something
  that is ascertainable by enquiry or experiment,
  albeit perhaps substantial enquiry or experiment,
  and the know-how which the ex-employee is clearly
  entitled to use extends to knowledge of the
  question which the confidential information
  answers, it becomes artificial to treat the
  confidential information as severable and
  distinguishable from that know-how and in that
  kind of case, courts have tended not to grant
  relief.

20
Government secrets

• Commonwealth v John Fairfax Sons, at CLR 51
• Attorney-General (UK) v Heinemann Publishers
  Australia Pty Ltd

21
Government secrets

• Semi-govt? British Steel Corp v Granada
  Television Ltd 1981 AC 1096
• Esso Resources Ltd v Plowman (1995) 183 CLR 10 at
  32
• Soldiers? R v Attorney-General 2003 UKPC 22
• Ministry of Defence v Griffin 2008 EWHC 1542

22
The duty or obligation of confidence

• Coco v A N Clark (Engineers) Ltd
• Express Obligation
• Implied Obligation
• Hitchcock v TCN Channel Nine Pty Ltd (No 2)
  2000 NSWCA 82.
• Unsolicited communications
• Misappropriation of information
• Eavesdroppers
• Third parties

23
Establishing a breach

• The test which has found widespread acceptance is
  whether or not the information was disclosed for
  a limited purpose. If the information was
  disclosed for a limited purpose, the confidence
  crystallises around that limited purpose. The
  confidant will be bound by an obligation the
  content of which is not to use or disclose the
  information for any purpose other than the
  limited one for which the information was
  imparted. -
• F Gurry, Breach of Confidence in P Finn (ed),
  Essays in Equity, 1985.

24
Establishing a breach

• Smith Kline and French Laboratories (Aust) Ltd v
  Secretary, Dept of Community Services Health
• Whether one adopts the reasonable man test
  suggested by Megarry J or some other, there can
  be no breach of the equitable obligation unless
  the court concludes that a confidence reposed has
  been abused, that unconscientious use has been
  made of the information

25
Establishing a breach

• R v Department of Health Ex parte Source
  Informatics Ltd
• The Court of Appeal found that the pharmacists
  would not breach confidence if they supplied
  anonymised information, even though this went
  beyond the confiders purpose in supplying the
  information. The confiders purpose was said to
  be irrelevant when the information was anonymous

26
Establishing a breach

• Detriment?

27
Defences

• Public interest
• expose dangers to public safety or health
• Hubbard v Vosper
• W v Edgell
• Lion Laboratories Ltd v Evans
• Woodward v Hutchins
• McKennitt v Ash 2005 EWHC 3003
• Richards v Kadian 2005 NSWCA 328

28
Defences

• Forced disclosure
• Delay
• Clean hands
• Campbell v Mirror Group Newspapers Ltd
• Australian Football League v Age Company Ltd
  (2007) 15 VR 405
• Change of position

29
Remedies

• Injunctions
• The springboard doctrine
• Delivery-Up
• Equitable compensation
• Harris v Digital Pulse Pty Ltd
• Giller v Procopets
• Account of profits
• Attorney-General (UK) v Blake
• Constructive trusts

30
The future rights to privacy?

• No right of privacy
• Victoria Park Racing Recreation Grounds Co Ltd
  v Taylor
• Australian Consolidated Press Ltd v Ettingshausen
  
• Kaye v Robertson (1991) FSR 62

31
Developments in New Zealand and England

• Bradley v Wingnut Films 1993 1 NZLR 415
• Hosking v Runting 2004 NZCA 34
• Douglas v Hello! Ltd

32
MAX MOSLEY v NEWS GROUP NEWSPAPERS LIMITED
33
SIR ELTON JOHN v ASSOCIATED NEWSPAPERS LTD
34
DAVID MURRAY (by his litigation friends NEIL
MURRAY and JOANNE MURRAY)v BIG PICTURES (UK)
LIMITED
35
Australia?

• Bathurst City Council v Saban
• Kwok v Thang 1999 NSWSC 1034
• Donnelly v Amalgamated Television Services Pty
  Limited (1998) 45 NSWLR 570
• Australian Broadcasting Corp v Lenah Game Meats
  Pty Ltd