Cosmopolitan Recruitment v Ludley and Another [2023]

PSN Recruitments Limited (t/ Cosmopolitan Recruitment) v Ludley and Greenscape Specialist Recruitment Limited [2023] EWHC 3153 (IPEC) involves a legal dispute between PSN Recruitment Ltd, trading as Cosmopolitan Recruitment, and its former employee, Graeme Ludley.

Ludley, upon leaving Cosmopolitan, emailed himself details of the company's clients and subsequently established a competing business named Greenscape Specialist Recruitment Ltd. Cosmopolitan alleged breaches of confidence and passing off, seeking damages for the losses incurred.

Ludley's actions included informing Cosmopolitan's clients that he was still associated with the company but under a different name and location. This led to a decline in Cosmopolitan's business, and the court found that Ludley's misrepresentation was part of a deliberate plan to start his own business. Greenscape did, in fact, secure new business shortly after Ludley's email. As a result, damages were awarded to Cosmopolitan, including compensation for loss of profits, damage to reputation, and lost management time.

Regarding the breach of confidence claim, Cosmopolitan argued that Ludley breached the confidentiality clause in his employment contract by sending the client list to his personal account. The court agreed, holding that the client list qualified as confidential information and Ludley breached both the confidentiality clause and the equitable duty of confidence. The judge did not find it necessary to delve into implied terms of Ludley's employment contract.

Legal principles from cases such as Faccenda Chicken v Fowler [1987], Lansing Linde Ltd v Kerr [1991], and others were invoked. The court recognised customer lists, like Cosmopolitan's client list, as protectable confidential information and trade secrets. It emphasised that the confidentiality of information could still be upheld, even if similar information were available from public sources.

Interestingly, the judgment did not reference Directive (EU) 2016/943 on the protection of trade secrets, which became law shortly before the UK's departure from the EU. Additionally, The Copyright and Rights in Databases Regulations 1997 were not mentioned, although the description of the case suggested that the client list might be considered a database.

In conclusion, the outcome of the case aligns with the factual circumstances presented. The absence of references to specific EU directives and UK regulations may raise questions, but settlement decisions and legal considerations not apparent in the public record could have played a role in this matter.
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