Brightex Paints (S) Pte Ltd v Tan Ongg Seng (in his personal capacity and trading as Starlit(S) Trading) and others

• Jurisdiction: Singapore
• Judge: Dedar Singh Gill JC
• Judgment Date: 03 May 2019
• Neutral Citation: [2019] SGHC 116
• Court: High Court (Singapore)
• Docket Number: Suit No 1187 of 2016 (Summons No 4922 of 2018)
• Published date: 20 November 2019
• Year: 2019
• Hearing Date: 14 December 2018,22 November 2018,01 November 2018,29 January 2019
• Plaintiff Counsel: Aaron Lee Teck Chye, Leong Yi-Ming and Marc Wenjie Malone (Allen & Gledhill LLP)
• Defendant Counsel: Jeeva Arul Joethy (Regent Law LLC)
• Subject Matter: Contempt of Court,civil contempt
• Citation: [2019] SGHC 116

Dedar Singh Gill JC: Introduction

On 29 January 2019, I heard an application, Summons No 4922 of 2018 (“SUM 4922/2018”) by Brightex Paints (S) Pte Ltd (“the plaintiff”), for an order of committal against Tan Ongg Seng (“the first defendant”) for contempt of court. Having determined that the first defendant had failed to comply with delivery up and disclosure orders against him, I committed him to 14 days’ imprisonment to commence on 19 February 2019.

The first defendant has since appealed. Separately, the plaintiff has appealed against my decision on sentencing. I therefore now set out the full grounds for my decision.

Facts The parties

The plaintiff is a Singapore incorporated company. Its business includes the manufacture and supply of wood coatings and furniture lacquers, decorative and industrial paints and chemical solvents.¹ The plaintiff has an established presence in Malaysia, Myanmar, Indonesia, Cambodia, Vietnam, India, Maldives and the Middle East and is best known locally for its selection of paint products.²

The first defendant is a former employee of the plaintiff and the younger brother of its managing director, Tan Tiow Lin. He is also an undischarged bankrupt. The first defendant worked for the plaintiff in two stints. He was initially employed from 1987 to 2002 before being rehired in October 2012. He subsequently resigned in 2016.

Background to the dispute

Sometime in late 2012, the plaintiff was looking to expand its presence in the Myanmar market. At the time, it already had a business relationship with B.H.I International Ltd (“the second defendant”). The plaintiff and Khin Myo Tint (“the third defendant”), the second defendant’s shareholder, agreed that the second defendant would set up a factory in Yangon to produce some of the plaintiff’s products.³ The second defendant was to be the exclusive distributor of the plaintiff’s products in Myanmar.⁴

Consequently, the first defendant was appointed as the plaintiff’s Myanmar production manager.⁵ He was assigned to oversee the operations of the second defendant which included:⁶ managing and overseeing the inventory of raw materials at the second defendant’s factory and obtaining these materials from the plaintiff; encoding the plaintiff’s formulas for production by the second defendant; and travelling to Myanmar to oversee operations.

Thus, in the course of his work, the first defendant gained access to confidential and business sensitive information, such as raw material lists, product formula files, product code lists, supplier lists, container code lists and/or stock information relating to the plaintiff’s products.⁷ It was agreed that the second and third defendants would only be privy to certain encoded formulas for the production of the plaintiff’s products in the second defendant’s factory. They would also have access to certain technical documentation and limited raw materials for the plaintiff’s products.⁸

On 30 September 2016, the first defendant tendered his resignation. On or around 17 October 2016, the plaintiff and the third defendant agreed to bring their business arrangements to an end and the second defendant ceased to be the plaintiff’s distributor in Myanmar.⁹ Sometime after the first defendant’s resignation, the plaintiff was informed by one of its suppliers that the first defendant had contacted it to source for raw materials in accordance with the plaintiff’s confidential formula specification.¹⁰

This alarmed the plaintiff and it sought assistance from Chang James Tan Swee Long (“Mr Chang”), a forensics consultant at Infinity Forensics (Private) Limited, to conduct a forensic examination of the desktop computer used by the first defendant whilst he was employed by the plaintiff (“the first defendant’s computer”).¹¹ On 26 October 2016, Mr Chang produced his report which documented several key findings.¹²

The report uncovered that the first defendant had, without the plaintiff’s authorisation, linked his personal Dropbox account to the first defendant’s computer on 17 June 2016. This account was used at least until 13 September 2016. During this period, the first defendant synced 3,052 confidential work documents found on the plaintiff’s shared network drive to his personal Dropbox account. He subsequently uninstalled the Dropbox application and removed his account from the first defendant’s computer.¹³

Separately, a large amount of data from the plaintiff’s shared network drive was copied by the first defendant to the first defendant’s computer. These files, which included paint formulas, sales reports, customer quotations and customer name lists, were transferred to removable storage devices before being deleted from the first defendant’s computer.¹⁴ These file transfers took place in three tranches: 5,340 files were transferred on 10 June 2016; 5,917 files were transferred on 16 June 2016; and 5,793 files were transferred on 20 June 2016.

A total of 343 email exchanges between the first defendant and the third defendant were also extracted from the first defendant’s computer.¹⁵ The titles of these emails appeared to indicate that the first defendant had sent the plaintiff’s confidential information to the second and third defendants.

The full extent of the first defendant’s actions, including other instances of file transfers and mass deletions from the first defendant’s computer, is particularised in the plaintiff’s Statement of Claim (Amendment no 1) (“ASOC”).¹⁶ Schedule A of the ASOC specifies the confidential information which was accessed by the first defendant and is included as Annex 1 to this judgment.

Procedural history

With this information in hand, the plaintiff commenced Suit No 1187 of 2016 (“Suit 1187/2016”) to obtain, inter alia, an injunction to prevent the further unauthorised use and dissemination of its confidential information and an order that the first defendant deliver up all confidential information in his possession and disclose the use of such information to the plaintiff.¹⁷

On 11 July 2017 the first defendant filed his Defence (Amendment No 1) (“Defence”), which raised several significant points: the information obtained by the first defendant was not confidential and, even if it was, its confidentiality was lost and/or waived by the plaintiff;¹⁸ the first defendant obtained the plaintiff’s information with its knowledge and consent;¹⁹ the first defendant downloaded parts of the plaintiff’s confidential information onto his external storage device and personal Dropbox account and took photographs of the same for use in the course of his work and as a backup;²⁰ the first defendant continued to oversee production at the second defendant’s factory after his resignation on 30 September 2016;²¹ and the first defendant retained possession and use of the plaintiff’s information for the purpose of assisting the second defendant in the production of the plaintiff’s products.²²

On 21 September 2017, the first defendant was adjudged a bankrupt. The bankruptcy order was made pursuant to the first defendant’s own application. On 9 February 2018, the plaintiff obtained leave to continue proceedings against the first defendant. On 25 April 2018, with the Official Assignee’s leave, the first defendant filed a notice to discontinue or withdraw his Defence. Consequently, the plaintiff applied for interlocutory judgment against the first defendant in Summons No 2803 of 2018 (“SUM 2803/2018”). I make the observation that the first defendant consciously chose to withdraw his Defence rather than apply for leave from the Official Assignee (“OA”) to defend the suit.

On 6 July 2018, Aedit Abdullah J granted judgment (Judgment No 364 of 2018) (“the Judgment”) pursuant to O 19 r 7 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) (“ROC”), imposing an injunction against the first defendant. Paragraphs three (the “delivery up order”) and four (the “disclosure order”) of the Judgment directed the following: 3. The 1st Defendant is to deliver up all of the Plaintiff’s Confidential Information and/or Copyright Works in the possession, power, custody or control of the 1st Defendant, the use or disclosure of which would offend against the foregoing injunction against him, within 7 days. 4. The 1st Defendant is to disclose to the Plaintiff all unauthorised usage and/or disclosure of the Plaintiff’s Confidential Information and/or Copyright Works, as well as the identities of third parties that the Plaintiff’s Confidential Information and/or Copyright Works have been communicated and/or disseminated to, within 7 days. References to the plaintiff’s “Confidential Information and/or Copyright Works” included but were not limited to Schedule 1 of the Judgment. Schedule 1 is included in full as Annex 2 to this judgment.

On 11 July 2018, the Judgment was extracted and served on the first defendant.²³

The committal hearing

On 27 September 2018, the plaintiff applied for leave to commence committal proceedings against the first defendant on the basis that the delivery up order and disclosure order (collectively, “the Orders”) had not been complied with.²⁴ I granted leave to the plaintiff on 9 October 2018. On 22 October 2018, the plaintiff applied for an order of committal in SUM 4922/2018.

SUM 4922/2018 was first heard on 1 November 2018. The first defendant, who was in person, sought a final opportunity to comply with the Judgment. I granted an adjournment and on 22 November 2018, parties came before me again. Mr Jeeva Arul Joethy (“Mr Joethy”) appeared on behalf of the first defendant. He sought another adjournment to obtain approval to act from the OA and to take instructions. I cautioned that the first defendant could not seek to delay proceedings to avoid satisfying the Orders. Nevertheless, I granted the adjournment and directed Mr Joethy to ensure the first defendant’s compliance as soon as possible.

Later...