Littau Robin Duane v Astrata (Asia Pacific) Pte Ltd

• Jurisdiction: Singapore
• Judge: Tay Yong Kwang J
• Judgment Date: 10 December 2010
• Neutral Citation: [2010] SGHC 361
• Published date: 13 September 2011
• Court: High Court (Singapore)
• Year: 2010
• Docket Number: Suit No 156 of 2010 (Summonses No 3229 of 2010 and 3351 of 2010)
• Plaintiff Counsel: Anthony Lee, Gan Kam Yuin and Joana Lee (Bih Li & Lee)
• Defendant Counsel: Andy Leck, Gerald Kuppusamy, Jennifer Fong Lee Cheng and Shaun Lee (Wong & Leow LLC)
• Subject Matter: Civil Procedure
• Citation: [2010] SGHC 361

Tay Yong Kwang J: Introduction

The plaintiff was a former group regional director of the defendant. Between March 2005 and December 2009, he was employed in various senior executive and managerial positions in the Asia-Pacific region. During his employment, he signed a Confidentiality, Restrictions & Intellectual Property Agreement (“the non-compete agreement”) with the defendant. On 11 September 2009, the plaintiff gave three months’ notice of his resignation. His last day of employment would therefore have been 10 December 2009. However, on 9 December 2009, the defendant purported to dismiss him summarily with immediate effect.

The defendant was incorporated in Singapore in October 2003. It is in the business of designing and developing location-based information technology services and solutions (telematics). These solutions enable businesses and government organizations to monitor, trace and control the movement and status of machinery, vehicles, personnel and other assets. The defendant’s business dealings are often confidential as they pertain to matters of security and defence. It is part of the Astrata Group of companies which comprises Astrata (Singapore) Pte Ltd (“ASP”) and Astrata Group Inc (“AGI”), a USA company. AGI is the parent company of the defendant which is in turn the parent company of ASP.

The plaintiff commenced an action for the salary due to him from September to 10 December 2009 and for payment of expenses and accrued leave. The defendant filed its defence and counterclaim alleging that the plaintiff had breached his duties by giving information to certain entities (“the US parties”) resulting in the defendant having to incur extra costs to defend a Chapter 11 proceeding in the USA. Just before the defendant applied for an interim injunction and a search order against the plaintiff, it sought leave to amend its defence and counterclaim to include a new claim for breach of the non-compete agreement. Its application was allowed save for the prayer asking for leave to use the evidence obtained in this action in any other proceedings between the Tridex Companies and the defendant’s group of companies.

On 21 June 2010, the defendant applied for and obtained an interim injunction and search orders against the plaintiff. These orders were extracted as order no. 2968 of 2010 (“the injunction”), order no. 2969 of 2010 and order no. 2986 of 2010 (“the search orders”). Among other things, the defendant alleged that the plaintiff had approached its customers and business partners (namely COSEM, the Tridex Companies and TNT). The injunction enjoined the plaintiff from giving confidential information to third parties and from breaching the non-compete agreement. The search orders were directed at evidence that the plaintiff had given information to the US parties as well as his breach of the non-compete agreement. The search orders were extended by the court on 25 June 2010, extracted as order no. 3082 of 2010, as the physical imaging of the plaintiff’s gmail account could not be completed in time. A moratorium of two weeks was ordered against perusal of any materials obtained as a result of these orders and if the plaintiff should apply within two weeks to set aside or to vary the orders, the prohibition against perusal would continue until further notice.

There were two applications in issue here. In summons no. 3229 of 2010, the plaintiff sought to set aside the orders mentioned above, the return of certain items, the prohibition against usage of those items in any legal or arbitral proceedings against the plaintiff or other entities, the non-disclosure of the items’ contents, an inquiry as to damages and costs. In summons no. 3351 of 2010, the defendant applied for a copy of an email sent from one James Lau to the plaintiff on 19 April 2010 (“the James Lau email”) to be made available to the defendant or its solicitors, that the moratorium be lifted in respect of that email and that the defendant be permitted to use it in this action and for costs.

After hearing the parties, I varied order no. 2969 of 2010 by setting aside that part of paragraph 2 that allowed the defendant to use the information and documents disclosed or produced pursuant to the search orders for purposes of any claim against the plaintiff as well as the Tridex Companies in and outside Singapore (“the arguments on the Riddick principle”). All other orders granted were ordered to stand. I also lifted the moratorium against perusal and ordered costs at 90% to be paid by the plaintiff to the defendant, the deduction of 10% being the costs attributed to the arguments on the Riddick principle. No stay was granted in respect of these orders. I directed the parties’ solicitors to review the disputed documents obtained and try to come to an agreement whether they fall within the ambit of the search orders, failing which the plaintiff may apply to court to resolve the matter.

The plaintiff has appealed to the Court of Appeal against these orders.

Background to the dispute

In the course of the plaintiff’s employment, he signed, in 2007, the non-compete agreement which contained the following pertinent terms:

RESTRICTIVE COVENANTS

3.2 The Employee will not without the prior consent of the Company directly or indirectly and whether alone or in conjunction with or on behalf of any other person and whether as a principal shareholder, director, employee, agent, consultant, partner or otherwise: 3.2.1 within the Restricted Territory for a period of 12 months from the Termination Date be engaged, concerned or interested in, or provide technical, commercial or professional advice to, any other business which supplies Products or Services in competition with the Company or any Relevant Group Company provided that this restriction does not apply to prevent the Employee from holding shares or other securities in any company which is quoted, listed or otherwise dealt in on a recognised investment exchange or other securities market and which confer not more than three per cent of the votes which could be cast at a general meeting of such company; or

…

3.2.3 within the Restricted Territory for a period of 12 months from the Termination Date be engaged, concerned or interested in any business which is or was at any time during the Relevant Period a Relevant Customer if such engagement, concern or interest causes or would cause the Relevant Customer to cease or materially reduce its orders or contracts with the Company or any Relevant Group company or 3.2.4 for a period of 12 months from the Termination Date so as to compete with the Company or any Relevant Group Company canvass, solicit or approach or cause to be canvassed, solicited or approached any Relevant Customer for the sale or supply of Produces or Services including any Relevant Products or Services or endeavour to do so; or 3.2.5 for a period of 12 months from the Termination Date so as to compete with the Company or any Relevant Group Company deal or contract with any Relevant Customer in relation to the sale or supply of Products or Services or any Relevant Products or Services, or endeavour to do so;

…

CONFIDENTIALITY

4.1 The Employee acknowledges that in the ordinary course of his employment he will be exposed to information about the business of the Company and the Group and that of the Company’s and the Group’s suppliers and customers which amount to a trade secret, is confidential or is commercially sensitive and which may not be readily available to others engaged in a similar business to that of the Company or any of the Group Companies or to the general public and which if disclosed will be liable to cause significant harm to the Company or such Group Companies. The Employee has therefore agreed to accept the restrictions in this clause 4. 4.2 The Employee will not during the period of his employment with the Company obtain or seek to obtain any financial advantage (direct or indirect) from the disclosure of such information acquired by him in the course of his employment with the Company. 4.3 The Employee will not either during his employment (including without limitation any period of absence or of exclusion pursuant to any period of garden leave duly authorized by his contract of employment) or after its termination without limit in time for his own purposes or any other purposes other than those of the Company or any Group Company (for any reasons and in any manner) use or divulge or communicate to any person, firm, company or organization, except to officials of any Group Company who are entitled to know, any secret or confidential information or information constituting a trade secret acquired or discovered by him in the course of his employment with the Company relating to the private affairs or business of the Company or any Group Company or its/their suppliers, customers, management or shareholders.

The “Termination Date” referred to would be 9 December 2009 according to the defendant and 10 December 2009 according to the plaintiff. “Products or Services” was defined as referring to products or services of the same kind or materially similar kind or competitive with any products or services sold or supplied by the defendant or any Relevant Group Company. “Relevant Customer” referred to any person or organization who/which during the Relevant Period is or was negotiating with the defendant and a Relevant Group Company for the sale or supply of Relevant Products or Services or a client or customer of the defendant or any Relevant Group Company for the sale and supply of Relevant Products or Services or in the habit of dealing with the defendant or any Relevant Group Company for the sale or supply of Relevant Products or Services and in each case with whom or which the plaintiff was directly concerned...