[2025] EWHC 2759 (Ch)

Fecha: 24-Oct-2025

Relevant substantive legal principles

Relevant substantive legal principles

42.

A difference on the legal principles had opened up by the end of the trial.

43.

Both parties accept that the statement of the relevant legal principles on breach of confidence, joint liability and unlawful means conspiracy in [178]-[190], [195]-[197], [199]-[203] of the 2023 Judgment is correct, as- in the case of breach of confidence- analysed and expanded upon in the Court of Appeal Judgment at [41]-[56] and - on joint liability- [34]-[35]. Therefore, I do not repeat it here.

44.

As I explained at [179], the basic requirements of breach of confidence are:

(1)

the information must have the necessary quality of confidence about it;

(2)

the information must have been imparted in circumstances importing an obligation in confidence; and

(3)

an unauthorised use of that information to the detriment of the person communicating it.

(As I explained, there is a possible fourth requirement, but it would be satisfied if (1)-(3) were, so it is not necessary to deal with it further.)

45.

It flows from this that the satisfaction of conditions (1) and (2) imports an obligation on the recipient not to use the information without authorisation to the detriment of the person who has communicated it.

46.

Here, as I found in the 2023 Judgment, the information was communicated to each of the Defendants in circumstances importing an obligation in confidence. That finding does not appear to be challenged by Mr Timol and in any case I find that it did happen, for the reasons in that judgment coupled with the information now before me about the full extent of Mr Timol’s role. Therefore, none of the defendants, whether the First Defendant Company, or the three individual defendants, Mr Timol, Mr Slattery and Mr Johnson, could have walked outside the 4 February 2014 meeting and published the information. Each of them was personally bound by the obligation in confidence. None of them- and this is important to be clear on for the purposes of Mr Timol’s argument- could have invoked the fact that they held positions in the OneE corporate group to relieve themselves from that obligation or from liability for such publication.

47.

Mr Timol also accepts that development of the Nemaura product by Mr Slattery and Mr Johnson, as I found that Mr Slattery and Mr Johnson had engaged in, would (assuming that it used the Claimant’s confidential information, as I found it did) amount to misuse of the confidential information leading to personal liability, again irrespective of the fact that they held positions in the OneE corporate group.

48.

However, as explained at [8]-[11] above, in oral closing Mr Lawrence submitted that if I found that Mr Timol signed off the Nemaura structure, whether to be marketed, implemented or developed further, that was not capable of rendering him personally liable unless he also knew that this would involve the use of information that had come from the Claimant, because Mr Timol was merely signing-off the marketing, use and implementation of the information by OneE Group. For liability to arise Mr Timol had to know that the structure had been or was being developed using information that had come from the Claimant. Therefore it was OneE Group rather than Mr Timol that was primarily liable, as only OneE Group had “used” the information, and Mr Timol had to satisfy the requirements of joint liability to be liable, involving as that would a requirement that he knew that the Claimant’s confidential information was being used.

49.

Mr Lawrence prayed in aid of this submission the following arguments:

(1)

He argued that there was very little authority on what constituted misuse in this type of situation, namely dealing with complex confidential information as an individual in the context of a corporate structure, and that there was no authority gainsaying the above analysis.

(2)

Specifically, the authorities in which the deployment of confidential information was found to constitute misuse without the user realising that another’s confidential information was being used, such as Seager v Copydex (No.1) [1967] 1 W.L.R. 923; [1967] F.S.R 211, only dealt with the liability of corporate defendants rather than individuals, and also involved less complex confidential information that in the present case, so provided no precedent for holding Mr Timol liable here without such a realisation that someone else’s confidential information was being deployed.

(3)

This was, he contended, consistent with the recent Supreme Court decision in Lifestyle Equities v Ahmed [2024] UKSC 17.

(4)

Consistent with that, Mr Timol’s conscience would not be affected absent the knowledge referred to above, and it would be a strong thing to hold him liable in such circumstances for a significant sum of money without a contractual obligation of confidence having been entered into personally by him.

50.

I reject that submission. In my judgment it is clear that the correct analysis is as follows:

(1)

Once an obligation in confidence is imposed on a recipient by reason of their receipt of confidential information in circumstances importing such an obligation, they are under a personal duty not to misuse it.

(2)

This is consistent with and supported by the decision in Seager. The underlying principle set out by Lord Denning MR at 931E was that someone who has assumed an obligation in confidence in relation to information “must not make use of it to the prejudice of him who gave it without obtaining consent”.

(3)

Therefore, the individual can later breach that obligation even though he is not conscious that he is using confidential information of another: [53] of the Court of Appeal judgment, the authorities cited therein, [190] of the 2023 Judgment, and [5-005] of Toulson and Phipps on Confidentiality (4^th ed, 2020).

Pausing there, taken together that means that there is no general requirement for a defendant to know that he is using information that is confidential in order for him to misuse confidential information for the purposes of the third limb of the classic breach of confidence test summarised at [44] above, in circumstances where the first two limbs of that test are satisfied.

(4)

The fact that the individual occupies a post within a company, or that the individual’s misuse may make the company liable for misuse, does not prevent the individual being liable. The reason for this is that the fact that an individual’s acts and wrongs may be attributed to a company by virtue of their role in the company involves a rule of attribution for determining when a company, who must act through individuals, will be liable for the acts of particular individuals. It does not exculpate the individual from liability or prevent the act being an act of the individual, whether in tort or in relation to wrongs dealing with intellectual property rights: Lifestyle Equities at [33], [64]. Therefore, in my judgment, the fact that Mr Timol was a company director does not allow him to pass sole responsibility to OneE Group for breach of confidence in respect of his acts.

(5)

I consider that there is nothing in Seager that is inconsistent with the above. On the contrary, if anything the tenor of Seager is that the individuals involved did breach the plaintiff’s confidence, without any suggestion that their corporate role made a difference- see e.g. 939H: Mr Boon and Mr Preston “did not, I think, realise that they were infringing a duty of confidence: I think that they did infringe it”.

(6)

Of course, there may be situations, as Mr Lawrence hinted at in oral submission, where the act of someone involved with a company can only ground liability for that company. Examples of this are where the act of an individual causes the company to breach a contract, and where the act of an individual causes the company to breach its duty of care in negligence. The former act does not cause the individual to be liable for breach of contract and the latter act does not cause the individual to be liable for negligence unless the individual assumes a direct duty of care. These are covered in Lifestyle Equities at [41]-[44] and [62]. The reason that such situations do not ground liability on the part of the individual absent the requirements for accessory liability being fulfilled is that the individual owes no direct duty to the victim in either case. It is the company that has contracted and owes the duty of care in negligence. Here, in contrast, the satisfaction of limbs (1) and (2) of the test for breach of confidence places the individual under a personal obligation in confidence.

Pausing there, the fact that individual occupies a post within a company does not impose any requirement that the individual know he is using information that is confidential in order to misuse confidential for the purposes of the third limb of the classic breach of confidence test summarised at [44] above, in circumstances where the first two limbs of that test are satisfied.

(7)

Therefore, in my judgment signing off the marketing, implementation and further development of the Nemaura structure by Mr Timol is capable of constituting misuse by him (where he satisfies the first two limbs of the classic breach of confidence test) without any need for him to know that information used in the structure is the Claimant’s information.

(8)

As long as Mr Timol knew the key featuresof the Nemaura structure (as summarised at [91] below), in my judgment there are two ways in which such sign-off can constitute misuse, either of which suffices, and both of which I took to be threads of Mr Hill’s submissions:

(a)

First, if an individual in Mr Timol’s position had those key features his mind when deciding whether to sign-off, he is using the confidential information in providing the sign-off. That is use of the confidential information every bit as much as if he himself had crafted the Nemaura structure and used the information to develop it, in the same way that the defendants in Seager unwittingly used the key features of the carpet grip imparted to them by the claimant when developing their own grip. If one does not know the key features at all, then one is not using those features in deciding to sign-off, and hence not using confidential information in deciding to sign-off, because one is not deploying those features in forming the decision to sign-off.

(b)

Second, he is signing off the marketing, implementation and development of a structure with those features, rather than just signing off the structure at a higher level of abstraction which he had been assured was robust from a tax perspective.

(9)

Consistent with the principle at (2) above that one must not make use of the information to the prejudice of the person who provided it without obtaining their consent, there is no need to disseminate the information to satisfy this requirement. There are other ways that one can deal with the information to the prejudice of the provider of it without passing it to another, such as using it to develop a product. Signing-off or otherwise taking an important decision to move forward with a product is another example.

(10)

One can readily see the potential absurdity if signing off the structure with knowledge of its features could not constitute misuse (without actual knowledge that its features came from the Claimant). Say that less senior individuals than Mr Timol also received the confidential information from the Claimant in confidence. Those- less senior individuals- who marketed, implemented or further developed the structure would be personally liable as long as they satisfied the first two limbs of the breach of confidence test, but Mr Timol- the person who signed off as the senior figure such actions- would escape liability despite having brought such actions about by virtue of the power that he held in the group.

(11)

Mr Timol’s actions in signing off were far more than assisting a primary corporate wrongdoer. As explained below, his actions were key to setting in train the marketing, implementation and further development of the Nemaura structure, as the most senior individual in the group other than Mr Ismail, who was stepping back from the end of 2013, as I explain below. At the very least Mr Timol’s agreement that the structure should proceed was absolutely critical to this process going ahead. Were it not for such a decision, the Nemaura structure would not have been marketed or implemented.

(12)

All of this is also consistent with the Supreme Court decision in Vestergaard Frandsen A/S v Bestnet Europe Ltd [2013] UKSC 31, [2013] R.P.C. 33. It was held there that once confidential information was received, the recipient’s state of mind in deploying it was irrelevant to whether they had misused: [24]. The reason Mrs Sig was not primarily liable was because- unlike in the present case- she had never received it in the first place: [28]. Therefore, she never came under a duty in confidence.

(13)

I do not consider that there is anything in the Court of Appeal judgment in the present case that is inconsistent with any of the reasoning above.

51.

Inherent in the above analysis are- among other things- the following points, which should be brought out separately for clarity.

52.

First, as I explained in [189] of the 2023 Judgment, given that the test for whether the information was imparted in circumstances importing an obligation in confidence requires the claimant to show that the defendant ought to have appreciated that it was confidential, a failure to make enquiries that would have revealed the confidentiality where a reasonable person would have made such enquiries is sufficient to attract the obligation of confidence.

53.

Second, if the defendant receives information imparted to him in confidence to which an obligation of confidentiality attaches, then provided he actually uses the confidential information, it is not necessary in order to establish misuse that he should appreciate that that is what he is doing, or that what he is doing amounts to a legal wrong: the Court of Appeal Judgment at [53].

54.

Third, as explained by the Court of Appeal in Imerman v Tchenguiz [2010] EWCA Civ 908 at [69], the concept of misuse can cover the following:

“In our view, it would be a breach of confidence for a defendant, without the authority of the claimant, to examine, or to make, retain, or supply copies to a third party of, a document whose contents are, and were (or ought to have been) appreciated by the defendant to be, confidential to the claimant. It is of the essence of the claimant's right to confidentiality that he can choose whether, and, if so, to whom and in what circumstances and on what terms, to reveal the information which has the protection of the confidence. It seems to us, as a matter of principle, that, again in the absence of any defence on the particular facts, a claimant who establishes a right of confidence in certain information contained in a document should be able to restrain any threat by an unauthorised defendant to look at, copy, distribute any copies of, or to communicate, or utilise the contents of the document (or any copy), and also be able to enforce the return (or destruction) of any such document or copy. Without the court having the power to grant such relief, the information will, through the unauthorised act of the defendant, either lose its confidential character, or will at least be at risk of doing so. The claimant should not be at risk, through the unauthorised act of the defendant, of having the confidentiality of the information lost, or even potentially lost.”

55.

Fourth, for joint liability to arise, the defendant must have knowledge of the essential features of the commission of the wrong by the primary wrongdoer: Lifestyle Equities CV v Ahmed [2024] UKSC 17 [2025] AC 1, as explained by Snowden LJ in the Court of Appeal Judgment at [35]. The defendant need not know that the act of the primary wrongdoer is unlawful. Rather, in the case of breach of confidence, the defendant must know that there is use of the claimant’s information by the primary wrongdoer, so he must know that it is the claimant’s information that is being used.

Evaluation of the witnesses

56.

The Claimant adduced evidence from Mr Johnson and Mr Timol from himself, and each of them were cross-examined.