Is a former employee entitled to retain their employer’s confidential information to support their legal claims?
In the case of Nissan v Passi [2021] EWHC 3642, the High Court considered an interim injunction application by Nissan seeking the return of a number of confidential documents which had been retained by a former employee, Mr Passi, after the termination of his employment.
Mr Passi was the Global General Counsel of Nissan and included in his contract of employment with Nissan were express provisions in relation to confidentiality, including the requirement to return all confidential information and other company property on termination of employment. When Mr Passi’s employment ended, he was reminded of these obligations and he advised Nissan that he had complied with them.
Mr Passi subsequently brought claims in the Employment Tribunal for unfair dismissal and whistleblowing detriment. During the course of the disclosure process, Mr Passi disclosed over 100 confidential and/or privileged documents belonging to Nissan.
Nissan applied to the High Court for an interim injunction seeking the return of its confidential information which Mr Passi had retained in direct breach of his contractual obligations.
In defence to this application, Mr Passi said that he had retained the documents for the purposes of seeking legal advice and to support his legal claims as he was concerned that Nissan would not disclose these documents itself in the course of proceedings.
The High Court granted the injunction and ordered Mr Passi to deliver up the retained documents belonging to Nissan, including those that had already been disclosed in the proceedings. The High Court held that Mr Passi had no entitlement or propriety right to possess these documents, whereas Nissan did. The fact that Mr Passi held onto them purely to support his legal case did not alter this.
The High Court commented that “It is not for a party that gains access to another party’s documents to decide unilaterally on the appropriate scope of disclosure of the other party’s documents” and to “pre-empt” what might happen during the disclosure process. Essentially the judgment is saying, that it must be assumed that both parties will lawfully comply with their disclosure obligations and it is not for one party to pre-judge this.
Employers can take comfort from this case which confirms that departing employees cannot lawfully retain the confidential documents of their employer in breach of their obligations, even for the purposes of legal proceedings.
This case also serves as a useful reminder for employers to ensure that all employees are subject to well-drafted express confidentiality provisions which the employer can rely on in the event that confidential information is ever taken by a departing employee. Whilst every employee is subject to an implied duty of confidentiality by virtue of the employment relationship, after termination of employment this will only protect an employer in respect of “trade secrets” which is limited to matters with a very high degree of confidentiality, for example, chemical formulae, designs or special methods of construction. Therefore, to protect “mere” confidential information which does not meet this high bar, it is essential to include express provisions in the employment contract which clearly set out which categories of information are confidential to the employer and are not to be disclosed or retained.
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